How Are House Charges Used in Navigator?

House charges in Navigator serve as an internal financial tool to adjust profit margins, cover expenses, and manage in-house warranties. They are automatically triggered during vehicle sales and allocated appropriately in the accounting system.

Practical Applications of House Charges

1. Adjusting Profit Margins

• House charges can be used to reduce the commission paid to sales staff by lowering the profit margin on vehicle sales.
• The excess funds are held in the balance sheet and can be:
  ✅ Used for year-end bonuses
  ✅ Offset against losses on other vehicles

2. Covering Additional Expenses

House charges help cover business-related costs such as:

• Valeting wages
• Late costs
• Advertising expenses

These are allocated separately from the vehicle’s stock record, ensuring accurate financial tracking.

3. Providing In-House Warranties

• House charges can be set aside to fund in-house warranties
• These funds can then be used to cover necessary repairs under the warranty

Important Consideration: Avoid Using House Charges for PDI/Prep Costs

⚠️ House charges should NOT be used to cover PDI (Pre-Delivery Inspection) or prep costs

• These costs are already accounted for within the stock record
• Misallocating them as house charges may create inaccuracies in financial reporting

How House Charges Work in Navigator

1️⃣ Triggered When an Order is Placed

• House charges are automatically generated when an order is raised against a stock record
• The charge amount depends on the type of sale

2️⃣ Posted as a Journal Entry When the Deal is Closed

• Once the deal is finalised, the system:
  ✅ Posts a journal entry
  ✅ Transfers the charge from the profit nominal code to the balance sheet