one of my clients is a garage that sells cars, they offer a 6 month warranty which they have been using a warranty company for.
The now want to bring the warranty back in house, how do we account for this. do We need a seperate bank account to hold the warranty payments and extended warranties, or just a seperate area on our system (clickdealer)
Where do we stand legally as is it not an insurance product... felling confused!!!
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Oh dont you just love car dealers. Is it new, 2nd hand or both? Im assuming from the mention of separate Bank accounts that they will be charging clients for such warranties? Is someone underwriting it? I thought extended warranties were actually now classed as a regulated product - there was some case law changing this as far as I am aware. Perhaps that wasnt the case when they last did this, but worth checking this out first and I would be interested in that one. As well as the day to day processing, there will be a need for provisions.
Ive not used clickdealer, was warned away form the product TBH - would be interested to know what you think of it
Thanks and I look forward to hearing more and then hopefully helping out.
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Joanne
Winner of Bookkeeper of the Year 2015, 2016 & 2017
Thoughts are my own/not to be regarded as official advice,which should be sought from a suitably qualified Accountant.
You should check out answers with reference to the legal position
