What it is
A dealership has a large, fast-turning inventory financed by floor plan notes, revenue departments with very different margins, and finance and insurance income that can be charged back. The checklist follows those risks: vehicle existence and valuation, floor plan reconciliation, contracts in transit and the chargeback reserve.
Manufacturer agreement terms vary by brand, so the checklist asks for the franchise agreement and factory statement requirements at the start.
When to use it
- Planning or finishing an audit of a franchised or independent dealership.
- When the lender or manufacturer requires audited statements and covenant calculations.
- To review the F&I and contracts in transit sections of a dealer file.
What’s inside
- Franchise, lender and manufacturer agreement review
- VIN-level inventory observation and floor plan confirmation
- Contracts in transit, deal testing and F&I reserve recomputation
- Parts, service work in process and warranty receivables
- Franchise intangibles, related-party leases and sales tax
Standard cited
This template follows AU-C 330 / ASC 330 / ASC 606. It is written in our own words, except for phrases the standard requires the document to contain, with [bracketed placeholders] for client details, amounts in USD and dates as MM/DD/YYYY. Check it against the current standard and your firm’s methodology before use. See AU-C 330 explained.
Questions
What does sold out of trust mean?
A vehicle sold to a customer without paying off the floor plan lender. Tie the VIN listing to the lender statement and test deals near year end to find units sold but still financed.
How is the F&I chargeback reserve tested?
Treat expected cancellations and repossessions as variable consideration (ASC 606-10-32-11). Recompute the reserve from cancellation history by product and compare with chargebacks occurring after year end.
How are manufacturer holdback and incentives accounted for?
Practice varies, and the treatment should follow the dealer’s documented, consistent policy. Read the manufacturer’s program terms and apply the dealer’s documented policy consistently.
Related templates
- Audit Program: Inventory
- Inventory Observation Memo and Test Count Sheet (AU-C 501)
- Audit Program: Debt and Equity
Last updated 11/05/2026. All free templates.