Under the looking glass: What will the compliance auditor find?
The unthinkable has happened. A compliance auditor from your state or the FTC has given you a date for your review. As you share this information with your staff, their reactions span the gamut from fear to denial. How can you prepare your team for a compliance audit – without completely derailing their productivity? Here are a few simple tips … and reasons why compliance matters for powersports dealers.
As a powersports dealer, you may think that compliance only impacts retail automotive dealers. You’re wrong. Consider these two specific points. The Department of Defense released new guidelines in August regarding the Military Lending Act, which could have specific impact on powersports lending. Secondly, this year has seen a flurry of lenders entering the powersports market. Compliance is a requirement for all lenders – and new lenders will only partner with those dealers who have a compliance process.
Now that we have answered the “compliance matters” question, let’s review a few pointers to get your team through a compliance audit.
Organize your deal documentation
Review every deal jacket and make sure all of the paperwork is in order. Even better, create a checklist, put it in the front of each jacket, and organize the paperwork according to the checklist. You’ll quickly see what’s missing – before the auditor spots the error.
Put your procedures in writing
In addition to the jacket checklist, put your F&I procedures in writing. Is each team member processing each deal in the same fashion? And while you’re at it, share those procedures with the sales and service bay.
Designate a leader
Identify one person who “owns” compliance and designate them as the audit lead. They will be the “go to” person who will work directly with the compliance auditor. Having a compliance leader smooths the audit process, lessens the burden on the F&I team, and sets the tone for the review.
Role play
Hold a “dry run” with your entire dealership, identifying roles each department plays, and answering potential questions. Your compliance leader can champion this dry run and be the model for your team members to take compliance seriously. Be positive about compliance and how it can benefit your company.
The glare of the compliance looking glass does not have to blind your team. The preparation process can reveal inefficiencies that are hampering your team’s productivity. Reviewing each deal jacket can highlight missed opportunities. Identifying a compliance leader can reward a key employee and provide a step up to management. And holding a compliance role-play pow-wow can bring the entire dealership team together. So embrace that compliance audit – it might just be a good thing!
Glenice Wilder is the vice president of Powersports for EFG Companies. A 33-year industry veteran, Glenice is responsible for growing and developing EFG’s action and powersports market channel. She combines her passion for motorcycles and her dedication to serving EFG’s customers to develop solutions that consistently exceed their expectations. Glenice acts as a strategic partner to assess her clients’ areas for improvement and how EFG can fill that role. She provides insight in how to increase productivity by pairing the right products within the right markets for the greatest return on investment.
