Here are the highlights of what is included in this edition. Please click here for the full version.
What to Look for When Buying a Dealership
Many dealerships are actively seeking to acquire other franchises. Dealership groups, both large and small, are well-positioned financially, creating numerous purchase opportunities.
When targeting a dealership for purchase, key considerations include:
• Goodwill
• Quality of Management
• Appraisal of Assets
• Economic Outlook
• Earnings Capacity
Safeguarding Your Dealership from Fraud
Dealership owners often grapple with the disappearance of cash, particularly amid suspected fraud. Internal control structure reviews are frequently neglected, and discussions about potential fraud are avoided. This neglect exposes dealerships to the risk of financial losses, legal repercussions, and reputational damage.
Contrary to the belief that smaller dealerships are immune to fraud or that trusted long-term employees are unlikely culprits, statistics from the Association of Certified Fraud Examiners (ACFE) suggest otherwise. Organizations with fewer than 100 employees are actually more susceptible to fraud, with an average monthly loss of $8,000, often remaining undetected for a year.
The New Employee Retention Credit Voluntary Disclosure Program
The Employee Retention Tax Credit (ERTC), initiated in March 2020 under the CARES Act, has been subject to misuse by promoters urging businesses to claim excessive credits. This has raised concerns and scrutiny from the IRS, resulting in a moratorium on new ERTC claims since September 14, 2023. In response to potential abuses, the IRS introduced the Employee Retention Credit Voluntary Disclosure Program (ERC-VDP) on December 21, 2023.
The ERC-VDP aims to allow employers to correct errors or omissions related to the ERTC without penalties or enforcement actions. However, it is crucial for employers to understand the specific eligibility criteria and requirements of the program to participate and benefit.