Credit Management in Australia - December 2016 by AICM

Volume 24, No 2 December 2016

The Publication for Credit and Financial Professionals

Electronic signatures – LATEST CASE LAW  C-suite executives support credit  Senior women in credit tell their story plus much more…

IN AUSTRALIA

DIRECTORS Australian President – James Neate MICM CCE

NSW Division: National YCP winner Fiyona Kidenya with her team.

Australian VP, Finance – Gregg Odlum MICM CCE Professional Development – Ben McCallum MICM YCPA & CCE – Trevor Goodwin MICM CCE Legal Affairs – Greg Young MICM CCE Member Services – Jeff Hurst FICM CCE CHIEF EXECUTIVE OFFICER Nick Pilavidis MICM CCE Level 3, Suite 303, 1-9 Chandos Street, St Leonards NSW 2065 PO Box 64, St Leonards NSW 1590 Tel: 1300 560 996, Fax: (02) 9906 5686 Email: nick@aicm.com.au

45 Qld Division: Credit Manager of the year – Decia Guttormsen with Roger Masamvu.

EDITOR/PUBLISHER Nick Pilavidis | Email: nick@aicm.com.au CONTRIBUTING EDITORS Arthur Tchetchenian NSW Stacey Woodward Qld Gail Crowder SA Warren Meyers WA Donna Smith Vic/Tas ADVERTISING MANAGER Andrew Le Marchant LICM CCE Phone Direct 02 8317 5052 or Mob 0418 250 504 Email: andrew@aicm.com.au

48 SA Division: Gail Crowder, State President with James Neate, National President and Lord Major Martin Haese.

EDITING and PRODUCTION Anthea Vandertouw | Ferncliff Productions Tel: 0408 290 440 | Email: ferncliff1@bigpond.com THE EDITOR reserves the right to alter or omit any article or advertisement submitted and requires idemnity from the advertisers and contributors against damages or liabilities that may arise from material published. CREDIT MANAGEMENT IN AUSTRALIA is published by the Australian Institute of Credit Management, Level 3, Suite 303, 1-9 Chandos Street, St Leonards NSW 2065. The views expressed in CREDIT MANAGEMENT IN AUSTRALIA are not necessarily those of Australian Institute of Credit Management, which does not expect or invite any person to act or rely on any statement, opinion or advice contained herein (whether in the form of an advertisement or editorial) and neither the Institute or any of its employees, agents or contributors shall be liable for any opinion contained herein. © The Australian Institute of Credit Management, 2016.

50 Vic/Tas Division: Nominees and Winner Credit Manager of the Year – David Condello, Mary Petreski, Winner Melissa Mann, Patrick Barry.

JOIN US ON LINKEDIN

Click Here EDITORIAL CONTRIBUTIONS SHOULD BE SENT TO: The Editor, Level 3, Suite 303, 1-9 Chandos Street, St Leonards NSW 2065 or email: nick@aicm.com.au

55 WA/NT Division: Simon Bligh CEO Dun & Bradstreet Australia and New Zealand presenting Sarah Reed with her National Finalist certificate.

Volume 24, Number 2 – December 2016

Message from the President

Software

Reporting – audit control

Human Resources

By Beth Gray FICM CCE

Managing the multi-generational workforce By Heidi Mayhew-Sanders

Women to the front By Alexandra Cain

Active learning: The key to your professional development

Economy

Small business risk update By Colin Porter

PPS How to use the Personal Property Securities Act when leasing equipment

Credit Management

By Leigh Adams

From insight to action – How to operationalise analytics to enhance customer engagement

AICM Training news

By Nicholas Harrak

Understanding trusts By Sally Nash and Jim Johnson

C-suite executives support credit By Alexandra Cain

Conference Report

36 38 40 41

Conference overview and photos YCP overview and photos

ASIC prosecutes business adviser who assisted a director to breach his statutory duties

COTY overview and photos Golf Day overview and photos

By Peter Marsden

Around the States

Legal

Unfair preferences and how to avoid them – Part 3

Sign of the times – what has your customer signed?

By Bonnie McMahon, Hayley Hitch and Stephen Mullette

Heidi MayhewSanders

Queensland South Australia

By Nick Cooper

42 45 48 50 54 56

New South Wales

9 Debbie Leo

Victoria/Tasmania Western Australia/Northern Territory New Members

Nicholas Harrak

Sally Nash

24 Hayley Hitch

29 Beth Gray FICM CCE

Colin Porter

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

aicm

From the President

James Neate MICM CCE National President

t the National Directors’ Board meeting

training and education event. Thanks go to both our

at the recent National Conference on

Platinum sponsor Veda and Supporting sponsor Austral

the Gold Coast, I was honoured to be

for their ongoing support.

elected as National President. I spoke at

Congratulations to Wyndham Vacation Resorts Asia

the Conference about a continued focus for the AICM

Pacific as winners of the Veda National Credit Team of

nationally and through the Division Councils, to “engage”

the year and also to the runners up Hyne Timber. It is

more with members and industry stakeholders. Over

fascinating to hear team members who have been involved

the last number of years the AICM has repositioned

in the Veda “CT of Y” Program, they all speak of the

itself and is becoming a more vocal advocate for the

benefits the team enjoyed simply by entering. It is to be

interests of its members, and by proxy benefit, the

recommended to credit teams small and large.

businesses who employ our members and those in the

Another Conference highlight was the Dun and

credit profession. There is an obligation on members

Bradstreet sponsored President’s Dinner, on a somewhat

to recognise what is on offer through the AICM and to

chilly night at Movie World. All present were privileged to

seize those opportunities or encourage others to use the

see the announcement of Fiyona Kidenya of News Corp

AICM, as a means for training and career progression. I

Australia and the NSW AICM Division as Young Credit

think it is incumbent upon those in positions of influence

Professional of the year. Congratulations go to Fiyona and

as credit managers, team leaders or mentors, to support

all the other State finalists who so well represented their

and encourage others within credit to fully understand

States and demonstrated there is a strong and engaging

this diverse industry and the opportunities available to

future for anyone joining credit.

build careers. A key focus I will urge through National Board and the Division Councils will therefore be reaching out to

Thanks to all our team at National Office for a great job and so much hard work. If anyone ever has any suggestions or feedback, I invite

members to engage, listen, and to involve members in

them to contact me or our CEO Nick Pilavidis. We are a

events so they become active advocates for the Institute.

member organisation and we welcome your thoughts and

At the Conference I also paid tribute to the leadership shown by Grant Morris in his capacity as National

your active engagement. All Divisions are ending the year with a flurry of events

President. Grant’s tireless efforts and “leading from the

which I urge you to support. Please plan now to engage

front” by practicising at Coates what he preached, meant

at events in your Division next year. Coming away from

that his voice was truly credible. Grant’s enthusiastic

the Conference I have a sense that we all face the same

energy inspires and our thanks go to Grant, and to

challenges in credit across all States. In many ways we

Dale (his wife), for the contribution Grant has made to

are one large “credit family” experiencing the same

revitalising the AICM.

work pressures and performance demands. Often credit

By many criteria our National Conference was one

roles are misunderstood and not appreciated. The AICM

of, if not the most, successful ever. A very important

is one place where “we speak your language” and our

factor in my mind has always been the quality of the

training and events are tailored for you and the needs of

speakers and presentations and the range of topics

your team. I urge you to “engage with the AICM” in the

and training available. Review of our program or asking

new year. Please have a safe and happy holiday and

those who attended any of the many varied sessions,

I look forward to an exciting programme of events across

will show that the calibre of our speakers, the currency

Australia in 2017.

of the topics and their relevance, all confirm that the

– James Neate MICM CCE

AICM National Conference is the premier true credit

National President

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

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Human Resources

Managing the multi-generational workplace By Heidi Mayhew-Sanders* Today’s workplaces can often have four or even five generations of staff working side by side. To attract and retain good staff, and maintain productivity, understanding generational differences is essential.

Heidi Mayhew-Sanders

Organisations must consider the needs of their multi-generational workforce, including individual staff members’ values and style of working. 6

By the year 2020, Australia’s workforce will be made up mainly of Generations X and Y. In the next four years, leadership will begin to transition from the Baby Boomers to Generation X, with Generation Y pushing for a position on the leadership ladder. Entering the workforce is Generation Z. It is no longer enough for organisations to align human resource management practices and employment relations to the business strategy. Organisations must consider the needs of their multi-generational workforce, including individual staff members’ values and style of working.

1. Recruitment and selection Regardless of generational issues, always thoroughly assess your recruitment need (job description and advertisement). During the interview, draw out generational work preferences and styles. While people from all generations can be flexible and adaptable, knowing a particular employee’s preferences and behaviours will help you understand what motivates them. Avoid any risk of discrimination, such as age discrimination, by ensuring a fair recruitment process. For example, it may be considered unfair to assess a Generation X applicant with a

Traditionalists

Baby Boomers

Born 1922–1945

Born 1946–1964

View of work: an expectation of society; a necessity Traditionalists Born 1922–1945

Leadership style: directive, can be commanding and controlling, individual interactive

View of work: an expectation of society; a necessity Leadership style: directive, can be commanding and controlling, individual interactive Communication: prefers formal communication such as letters, telephone and face to face

Communication: prefers formal communication such as letters, telephone and face to face

Motivated by: respect for experience, satisfaction in a job well done Feedback: not necessary (no news is good news) Work-life balance: work and family life are completely separate

Motivated by: respect for experience, 1. Recruitment and satisfaction in a job well done selection Feedback: not necessary (no news is good news)

Regardless of generational issues, always thoroughly assess your recruitment need (job description and advertisement). During the interview, draw out generational work preferences and styles. While people from all generations can be flexible and adaptable, knowing a particular employee’s preferences and behaviours

Work-life balance: work and family life are completely separate

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

Bentleys Thinking Ahead | Winter 2016

View of work: exciting and Babyadventurous Boomers Generation X Traditionalists Born 1946–1964

Born 1965–1980

Born 1922–1945

View of work: exciting and adventurous

View of work: a challenge and a contract

View of work: an expectation of society; a necessity

Leadership style: challenges, asks questions, views everyone equally; independent, entrepreneurial, interactive

Leadership style: directive, can be commanding and controlling, individual interactive

Baby Boomers

Leadership style: consensual and collegial, embracing the teamwork player Communication: prefers face to face

Motivated by: being valued and needed, recognition, healthy pay package Feedback: of little importance

Communication: prefers formal Communication: prefers to-the-point communication such as letters, and immediate communication of any telephone and face to face kind; does not like to be kept waiting Motivated by: respect for experience, Motivated by: freedom, doing things satisfaction in a job well done their way Feedback: not necessary (no news is Feedback: feedback important; has nogood news) problem in asking for it Work-life balance: work and family Work-life balance: flexibility and life are completely separate balance is key

Born 1965–1980

View of work: exciting and adventurous

View of work: a challenge and a contract

Leadership style: consensual and collegial, embracing the teamwork player Communication: prefers face to face Motivated by: being valued and needed, recognition, healthy pay package Feedback: of little importance

Communication: prefers face to face

Work-life balance: work to support their chosen lifestyle

Motivated by: being valued and needed, recognition and healthy pay package 2. Human resource 1. Recruitment and Feedback: of little importance development selection

will help you understand what

motivates them.

Avoid any risk of discrimination, such as age discrimination, by ensuring a

motivates them.

Training and development processes that Regardless of generational issues, reflect generational learning preferences always thoroughly assess your will provide a better return on yourrecruitment need (job description investment; for example, Baby Boomers and advertisement). During the and Generation X generally prefer to interview, draw out generational work communicate face to face. preferences and styles. While people Providing training that is delivered from by all generations can be flexible adaptable, knowing a particular webinar or through e-learning mayand result employee’s preferences and behaviours

Avoid any risk of discrimination, such as age discrimination, by ensuring a

Work-life balance: work to support their chosen lifestyle

fair recruitment process. For example,

it may be considered unfair to assess a

Generation X applicant with a gamification assessment tool, knowing that a

Generation X applicant is less likely to have been exposed to this type of assessment than a Generation Y applicant.

Bentleys Thinking Ahead | Winter 2016

Generation X

Born 1946–1964

Leadership style: consensual and collegial, embracing the teamwork player

fair recruitment process. For example, it may be considered unfair to assess a Generation X applicant with a gamification assessment tool, knowing that a Generation X applicant is less likely to have been exposed to this type of assessment than a Generation Y applicant.

Leadership style: challenges, asks questions, views everyone equally; independent, entrepreneurial, interactive

Communication: prefers to-the-point and immediate communication of an kind; does not like to be kept waiting Motivated by: freedom, doing things their way

Feedback: feedback important; has n problem in asking for it Work-life balance: flexibility and balance is key

2. Human resource development

Training and development processes reflect generational learning preferenc will provide a better return on your investment; for example, Baby Boom and Generation X generally prefer to communicate face to face.

Providing training that is delivered by webinar or through e-learning may re

Human Resources

A ‘one size fits all’ communication approach is no longer an option in a multi-generational workforce. gamification assessment tool, knowing that a Generation X applicant is less likely to have been exposed to this type of assessment than a Generation Y applicant.

2. Human resource development Training and development processes that reflect generational learning preferences will provide a better return on your investment; for example, Baby Boomers and Generation X generally prefer to communicate face to face. Providing training that is delivered by webinar or through e-learning may result in a lack of engagement in the training by Baby Boomers. This will result in a low return on your investment. Although Baby Boomers may be competent using the technology, their preference is generally for a non-technical delivery. Generations Y and Z, on the other hand, are likely to view the technological delivery of a webinar or e-learning as valuable and convenient.

3. Managing employee performance How organisations communicate information across the generations will impact on employee performance. Using different forms of communication, such as face-toface meetings and training sessions, webinar and email, will allow a multigenerational workforce to maximise their performance. If employees clearly understand the job requirements, what behaviours they need to demonstrate at work, and what reward and recognition they can expect, organisations will see a lower level of poor performance, and a higher level of high performance.

4. Recognition and reward Before you consider recognition and reward programs for your employees, understand what reward means for different generations. Actively seek suggestions from your employee through cultural and engagement surveys as well as individual and group discussions.

Generation Y

Born 1965–1980

Born 1981–1995

View of work: a challenge and a contract Traditionalists Baby Boomers

View of work: a means to an end as well as fulfilment Generation Y

Generation X

Born 1922–1945

Born 1946–1964

Born 1965–1980

View of work: an expectation of society; a necessity

View of work: exciting and adventurous

View of work: a challenge and a contract

Leadership style: directive, can be commanding and controlling, individual interactive Communication: prefers formal communication such as letters, telephone and face to face

Motivated by: respect for experience, satisfaction in a job well done

Leadership style: consensual and collegial, embracing the teamwork player Communication: prefers face to face

Motivated by: being valued and needed, recognition, healthy pay package Feedback: of little importance

Work-life balance: work to support their chosen lifestyle

Leadership style: challenges, asks questions, views everyone equally; independent, entrepreneurial, interactive Communication: prefers to-the-point and immediate communication of any kind; does not like to be kept waiting Motivated by: freedom, doing things their way

Communication: prefers to-the-point and immediate communication of any kind; does not like to be kept waiting Feedback: not necessary (no news is good news)

Feedback: feedback important; has no problem in asking for it

Work-life balance: work and family life are completely separate

Work-life balance: flexibility and balance is key

For help with human resources in your organisation, contact Bentleys today.

*Heidi Mayhew-Sanders Human Resources P: +61 7 3222 9777 E: HMayhew-Sanders@bris.bentleys.com.au

need to demonstrate at work, and what reward and recognition they can expect, organisations will see a lower level of poor performance, and a higher level of high performance.

Generation X

Leadership style: challenges, asks questions, views everyone equally; independent, entrepreneurial, interactive

Identify and agree what your employer-employee value proposition is (‘What’s in it for you? What’s in it for us?’). Investing time to understand generational needs, and your employee value proposition, will result in employee engagement of the entire workforce, and successful long-term return on investment. Although individuals from each generation can be flexible and adapt, distinct generational characteristics can have a significant impact on human resources management. A contemporary approach that takes into account employee needs across all generations is essential for effective human resource management and employee relationship. Organisations that understand generational characteristics – organisations that work with the generational differences rather than against them – will be the leading enterprises.

need to demonstrate at work, and w reward and recognition they can ex organisations will see a lower level o poor performance, and a higher lev high performance.

Generation Z A ‘one size fits all’

A ‘one size fits a communication approach is no longer an option a multi-generation workforce.

communication Born 1996–2009 approach is no

longer an option in

View of work: may be a a multi-generational workforce. struggle for many Generation Z Generation Y 4. Recognition and reward

Born 1981–1995

Born 1996–2009

View of work: a means to an end as well as fulfilment

View of work: may be a struggle for many

Leadership style: personal and strategic; participative, interactive

Leadership style: likely to be innovative, interactive, visual and self-directed

Leadership style: personal and strategic; participative, interactive style

Communication: prefers email and voicemail Motivated by: working with talented and creative people; doing meaningful work

Communication: prefers email and voicemail

Feedback: expected as and when they require it; delivered instantly upon request Work-life balance: extremely important

Born 1981–1995

Generation Z

Born 1996–2009

Leadership style: likely to be innovative, interactive, visual and selfdirected

Communication: social media likely to be a strong form of communication

Before you consider recognition and View of work: a means to an end as well reward programs for your employees, understand what reward meansas forfulfilment different generations. Actively seek suggestions from your employeeLeadership through style: personal and strategic; participative, interactive cultural and engagement surveys as well as individual and group discussions. Communication: prefers email and

voicemail Identify and agree what your employeremployee value proposition is (‘What’s in by: working with talented and Motivated it for you? What’s in it for us?’). Investing creative people; doing meaningful work time to understand generational needs, and your employee value proposition, will expected as and when they Feedback: result in employee engagement require of the it; delivered instantly upon request entire workforce, and successful longWork-life balance: extremely important term return on investment.

View of work: may be a struggle for many Leadership style: likely to be innovative, interactive, visual and self-directed Communication: social media likely to be a strong form of communication

Communication: social media likely to be a strong form of communication

Motivation: likely to be motivated by individuality and variety of work with flexibility Feedback: likely to need frequent and positive feedback

Work-life balance: likely to value flexibility with their family of origin as a secure base

Different generations view human resource practices differently and this view may differ from the organisation’s view.

Motivation: likely to be motivated by individuality and variety of work with flexibility Feedback: likely to need frequent and positive feedback

Work-life balance: likely to value flexibility with their family of origin as a secure base

Motivated by: working with talented and creative people; doing meaningful work

Motivation: likely to be motivated by individuality and variety of work with 3. Managing employee 3. Managing employee flexibility performance performance

Feedback: feedback important; has no problem in asking for it

Feedback: expected as and when they require it; delivered instantly upon request

Work-life balance: flexibility and 4 balance is key

Work-life balance: extremely important

1. Recruitment and 2. Human resource Motivated by: freedom, doing things development selection their way will help you understand what motivates them.

Bentleys Thinking Ahead | Winter 2016

Avoid any risk of discrimination, such as age discrimination, by ensuring a

fair recruitment process. For example,

it may be considered unfair to assess a

Generation X applicant with a gamification assessment tool, knowing that a

Generation X applicant is less likely to have been exposed to this type of assessment than a Generation Y applicant.

Training and development processes that reflect generational learning preferences will provide a better return on your investment; for example, Baby Boomers and Generation X generally prefer to communicate face to face. Providing training that is delivered by webinar or through e-learning may result

in a lack of engagement in the training by Baby Boomers. This will result in a low return on your investment. Although Baby Boomers may be competent using the technology, their preference is generally for a nontechnical delivery. Generations Y and Z, on the other hand, are likely to view the technological delivery of a webinar or e-learning as valuable and convenient.

How organisations communicate information across the generations will impact on employee performance. Using different forms of communication, such as face-to-face meetings and training sessions, webinar and email, will allow a multi-generational workforce to maximise their performance.

Although individuals from each generation can be flexible and adapt, distinct generational characteristics can have a significant impact on human resources management. in a lack of engagement in the training by Baby Boomers. This will result in a low A contemporary approach that takes return on your investment. into account employee needs across all generations is essential for effective Although Baby Boomers may be human resource management and competent using the technology, their employee relationship. preference is generally for a nontechnical delivery. Generations Y and Z, Organisations that understand generational onwork the other hand, are likely to view the characteristics – organisations that delivery of a webinar or with the generational differences technological rather e-learning as valuable and convenient. than against them – will be the leading enterprises.

If employees clearly understand the job requirements, what behaviours they

For help with human resources in your organisation, contact Bentleys today.

If employees clearly understand the job requirements, what behaviours they

Feedback: likely to need frequent and positive feedback Work-life balance: likely to value flexibility with their family of origin as 5 a secure base

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

4. Recognition and rew

Before you consider recognition an reward programs for your employee understand what reward means for different generations. Actively seek suggestions from your employee th cultural and engagement surveys a as individual and group discussions

Identify and agree what your emplo employee value proposition is (‘Wha it for you? What’s in it for us?’). Inve time to understand generational ne and your employee value propositio result in employee engagement of t entire workforce, and successful lon term return on investment.

Different generations view human res practices differently and this view ma from the organisation’s view.

Although individuals from each gen can be flexible and adapt, distinct generational characteristics can hav significant impact on human resour management.

A contemporary approach that take into account employee needs acros all generations is essential for effect human resource management and employee relationship.

Organisations that understand gener characteristics – organisations that w with the generational differences rath than against them – will be the leadin enterprises.

For help with human resources in organisation, contact Bentleys to

Human Resources

Women to the front Females are a force in credit. Here we talk to three of the most outstanding contributors to the industry about their careers and their advice for other young credit managers.

Sophie Chatz: working with clients for a better outcome

By Alexandra Cain*

“... women have been able to take on more positions, be promoted and stand their ground” 8

Sophie Chatz, credit and commercial manager at Sheppard Cycles, says there’s two parts to her work that make it so rewarding. “I love to see the development, promotion and progress of my team.

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

And I love working with customers who have struggled for a long time that have potential. I’m talking about customers in the bicycle industry who have operated a struggling business and who I have worked with to review their financials, their potential and staff, as well as traffic in and out of the store,” says Chatz. “I like to get them to a point where they’re operating a really successful business and managing cash flow well, which helps my team,” she adds. When it comes to challenges, Chatz says as she’s passionate and loves what she’s doing, the key is finding a balance between work and life. “Not taking everything on is one of my biggest challenges.” She says it’s been rewarding seeing the confidence of women in the industry grow over time. “There has been a change and women have been able to take on more positions, be promoted and stand their ground. Internal confidence has been one of the biggest things.”

Human Resources

She praises the AICM for its work promoting women in credit. “Going to events is an opportunity to find young talent, which has helped change the way women are viewed in credit.” Mentoring has been a feature of Chatz’s career. “I have had the opportunity to work really closely with a sales manager. Being able to visit some of the stores has given me the opportunity to understand different parts of credit. Helping dealers review their financials, business models and metrics has made a huge difference to how I do my job, information I can then take back for my team. He’s been one of the biggest contributors to my learnings in credit.” She also has another mentor who she can call on who has helped her understand the behavioural and cultural aspect to her role. “He’s another credit manager, and I can pick up the phone to him ask him how he would deal with a particular experience. He has a really good temperament and outlook I can learn from.” Chatz’s advice for young women in the industry is to always stand back, review and assess the situation and understand the most important task to tackle, otherwise it’s easy to become overwhelmed.

Debbie Leo:

total customer focus

Debbie Leo, general manager – sales, major accounts, at Veda says one of the best parts of her job is building really strong relationships with customers. “Some of my customers I’ve worked with since I was 18. There has been a long history which builds trust on both sides.” Leo says her fire was first lit for credit early in her career. “I was told that when I got my first promotion not to expect to be promoted further because I was a woman. I was only 24, and I thought, ‘just watch me’.”

“Females manage their customer base and teams really well. They tend to have great attention to detail.” Today, meeting customer expectations is one of the most rewarding aspects of her career. “When people trust your advice it’s a very rewarding feeling. When a customer rings and says, ‘the system has done everything you said it would do,’ that gives you a great deal of satisfaction and pride in the service you provide. I thrive on having customers who are able to do their jobs more effectively because we provide them with a quality service.” Leo says she has witnessed substantial change in the industry since she started. “There are lot more women in credit management roles. Females manage their customer base and teams really well. They tend to have great attention to detail. I think women doubt themselves more

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Human Resources

so they try harder. I love seeing a growing number of young women coming through our industry. A career in this space can be challenging and rewarding. “It’s not just being on the phone and collecting money and it’s not just about opening and reviewing accounts. There’s a whole lot of regulation and compliance that you need to understand. Credit management needs strong communication skills and I think the role deserves more credit – no pun intended – than it gets.” Leo says having had a number of great bosses, both men and women, has really helped her career. “I’ve had good and not so good bosses. I’ve tried to take the best from them all. If I see someone who is not behaving well or who has not been a strong leader for whatever reason, I have made sure that I learn from that.” Her message to young women in the industry is to work out what motivates them. “Every job has its tough days. I’ve worked in the industry for 30 years and every day I’m challenged. My advice is to work for companies that will develop you and to find a job that’s interesting. But really, regardless of the job you do, it’s your passion and enthusiasm that will make the difference in how you enjoy your role.” She says some jobs won’t take you as far as you want to go, but even in this situation it’s important to work hard. “Because I did this I always got tapped on the shoulder to do the next role. Find out what you love and what motivates you. We spend a lot of time at work. You shouldn’t stay in a role if you’re really unhappy. It’s just not worth it.” Finally, Leo says it makes her happy more young women are coming into the credit industry. “I think it’s an industry that is really suited to females because of the different attributes we have. I really hope young women continue to join and love the industry as much as I do.”

Alison Beythien: all about relationships

Alison Beythien, O2C services manager for Holcim Australia, which supplies aggregates, concrete readymix and concrete pipe and products, says for her, watching people develop is the most rewarding aspect of her career. “We had a fairly young credit manager join us three years ago, and she is now running projects nationally for me and absolutely thriving in the role. Watching her develop and learn and understand the business is incredible to watch.” She says what’s highly prized in credit is an ability to be sure of your facts. “It’s about making sure you have as much information as possible so that you’re making the correct decisions.” Beythien says networking is extremely important. “Working closely with business leaders to understand their strategies and how your team can add value is key. Developing trust with the business and sales teams ensures difficult decisions can be debated with the best outcome achieved for the business.” She says women have come a long way in credit since she has worked in the industry. “There are

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

“Working closely with business leaders to understand their strategies and how your team can add value is key. more opportunities for women now. My team is 50/50 women and men in the management role, and now it’s certainly a lot easier for women to succeed.” Working for especially inspiring people early on helped Beythien get her start. “I worked for a manager who spent a lot of time discussing and debating things with me. He wanted me to have a career rather than just a job. He led by example with a lot of encouragement and coaching.” Working in HR for a few years also helped Beythien develop more depth in people management. “It was a leftfield opportunity, which was a really good thing for me.” Her final advice for women coming into the industry is to listen and learn from your peers. “In the credit world experience is number one, because there are so many things that have the potential to hit you from left-field in credit. So build your relationships with salespeople, your customers and your team to do the best job possible.”

*Alexandra Cain is a freelance finance journalist who has written for many leading Australian and international business publications.

Human Resources

Active learning:

the key to your professional development The AICM 2016 National Conference offered attendees countless opportunities for professional development, but the real return on investment is translating the experience into tangible personal and professional outcomes. As the saying goes; you only get out what you put in.

“It’s essential to walk away with a sense of ownership over the insights you’ve gained.”

Jane Calleja, National Training Manager at Weber BBQ has spent over 24 years teaching learning and development across numerous industries, including finance at companies such as National Credit Insurance Brokers and Westpac. Her presentation at the end of the conference shared practical habits to ensure attendees are equipped to get the most out of opportunities at the conference and we caught up with her to hear why she thinks it’s essential to bring the conference mindset back to the office.

Put your focus on personal and professional growth. For a business manager, Calleja says the conference is an essential component in learning to be ‘changeready.’ “You need to be asking ‘how can I engage my team as we bring in automation or new technologies’ and ‘how can I harness their creativity and continue to develop them to create new business opportunities.’”

Engage, socialise and reflect.

Jane Calleja

The German brain researcher Hermann Ebbinghaus has a model called a ‘forgetting curve,’ which teaches us that nine hours after we listen to a presentation we won’t have retained almost 36 per cent of what we’ve heard. Calleja explains that we must apply mechanisms for recall in order to firstly build long-term memory and secondly to apply insights gained at the conference.

“When you’re actually in the conference room – take notes!” By putting what you’re hearing onto paper and into something you understand, you’re engaging yourself with the process. Then, you need to actively reflect on the experience. “You need to value taking the time to reflect on the experience and ask yourself ‘how can I apply that to my work?’ You should add to that by socialising your learning – talking about it. Discuss it with a leader or a manager to pull that information apart and process it.”

What happens when you get back the office? It’s essential to walk away with a sense of ownership over the insights you’ve gained. Being accountable for your actions post-conference, Calleja says, is key to instigating change. “It’s not just turning up and learning, but asking ‘what am I going to do with it?” One way to keep development going is to create what Calleja calls a ‘personal learning network’ that will continue the momentum. And it’s something the AICM actively facilitates. “I think the AICM really supports this by enabling you to find likeminded people. Those people can become a sounding board for new ideas, or the opportunity to find a business mentor, hear about new trends to help you stay relevant – or even light the way to a new career opportunity.”

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

From insight to action How to operationalise analytics to enhance customer engagement By Nicholas Harrak, Chief Operating Officer, recoveriescorp

When it comes to making decisions, most people favour the path of least resistance, even when it is clearly not the better choice.

Nicholas Harrak

The way we collect money has changed. In the era of automation, when big data and analytics are top talking points in strategy meetings around the corporate world, we have more information about our customers than we’ve ever had before. But does that mean we are smarter? At the 2016 AICM National Conference I was invited to provide an overview of how the evolving use of analytics is influencing the way agencies are interacting with customers. The half-hour lunchtime session allowed for just that – an overview, an opportunity to scratch the surface of a topic that, by its very nature, provides increasing rewards for deeper analysis. The presentation focused on how a few basic analytic techniques can be used to understand customers and optimise their engagement to enhance collection outcomes. As we know from managing our internal teams, the key to staff engagement is understanding what motivates an individual or group. Engaging customers is no different – the challenge is in filtering the extensive amount of data we have about our customers, into something meaningful and, critically, effective action. To do this, we need to discard our assumptions and embrace the theories of behavioural economics. One key assumption we make about our customers – and ourselves – is that we are all rational decision makers. Behavioural economic theory tells us that we are not, and the evidence can be surprisingly

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

compelling. When it comes to making decisions, most people favour the path of least resistance, even when it is clearly not the better choice. In essence, we are choosing to opt out of the decision making process, which seems simpler, but is still a decision by proxy. Understanding this behavioural tendency can enable companies to influence customer behaviour in very simple ways. For example, a study conducted by Eric Johnson and Daniel Goldstein on Organ Donation concluded the decision to donate organs is influenced far less by advertising and direct marketing campaigns than by the inclusion of an opt-out tick box on driver’s licence renewal. In fact, countries that appealed to their citizens’ morals and sense of social duty underperformed those that appealed to their citizens’ desire to avoid making a decision by 250%. In another example, the Economist newspaper recently offered subscribers two levels of commitment: online only for $56, or online and print for $125. Naturally, the majority of customers opted for the cheaper, online only version, contrary to the publisher’s preference for print. This led to a revision of strategy, and the subsequent introduction of a third option including both online and print for $125 that quickly became the most popular choice. In this case, understanding customers’ unwillingness to choose one over the other, unless influenced heavily by price, allowed the publishers to subtly influence their behaviour. Just as politicians crave the

Credit Management

top spot on a ballot paper, companies can use this ‘donkey vote’ mentality to their advantage. Understanding this fundamental truth of customer behaviour enables us to ‘frame the question’ to our advantage. At the conference, I asked a room full of credit managers who considered themselves rational thinkers, if they had ever purchased something they didn’t need in order to get something for free. Online shoppers in the room identified with the scenario of purchasing additional items just to reach a free shipping threshold. Many identified with feeling less pain from using a credit card instead of cash, or undertaking a 10 kilometre round trip to use a four cent per litre discount docket. None of these are rational decisions, but we immediately recognise them as fundamental and accepted consumer behaviour. We can recognise that smart companies are already exploiting this behaviour to their benefit, so what do we need to do to understand our customers and similarly prompt them to make the decision we prefer they make? Firstly, we need to understand what triggers our customers to behave the way they do. Just because we may behave irrationally does not mean that our behaviour is random. As we have seen, with the right insights, irrationality can be quite predictable. Let’s look at how these theories can apply to credit management. In a recent review of collection strategy, we challenged 12 collection letters with varying content, colours and fonts. The message contained in each letter was essentially the same. The existing, or ‘champion’ letter, had historically achieved an average engagement rate of 8.64%. We

trialled the 12 ‘challenger’ letters over eight weeks with 20,000 customers with varying outcomes, including one achieving an engagement rate of 11.64%, equating to an additional $300,000 in early collections for this client. A good result, but only the beginning of the process. To fully assess the success of the various strategies, we needed to analyse the results across a number of customer profiles. At a high level, there were four basic categories of customers: willing and able to pay, likely and able to pay, likely and unable to pay, unlikely and unable to pay. We looked at the trial results across each customer profile and found that while our engagement had significantly increased across the customer profiles with a high propensity to pay, we had actually decreased our engagement rate for customers with a low propensity to pay by around 10%. Further analysis revealed that each of the 12 letters performed differently across the four profiles. By looking one level deeper into the results from our trial and matching letters against profiles we have built over years of

understanding customer behaviour, we increased our overall engagement rate by 6.1%, resulting in increased collections of more than $600,000 for our client. Another strategy we ran this year focused on connecting with customers who had not engaged with us at all over the debt placement period. Using what we know about customer behaviour and general willingness to opt in where it is presented as an easy option, we were able to reach 7% of the group. As with our previous example, we then applied a digital strategy across our customer groups, presenting slightly different options, attempting to ascertain an optimal offer for each one, noticing engagement for each profile dropped away at different points. To optimise the outcome, we tailored the strategy to each customer profile and maximised customer engagement by around 12% overall. None of this would have been possible without a commitment to building and refining these customer profiles by distilling data from millions of contact attempts into meaningful and actionable insights. By viewing this analysis through the prism of behavioural economics, it is possible to predict and influence customer behaviour, even in the most emotional interactions that have the potential to drive even more irrational behaviour. For us, that means constant analysis and challenging of our accepted processes must be the norm. As analytic tools become simpler to use and more widely available, successful credit managers must move away from a broad brush approach to analysing trends and closely monitor customer behaviour. Understanding human nature – and our own irrationality – can actually be the key to success.

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

Understanding trusts By Sally Nash and Jim Johnson*

A trust is a legal mechanism of which there are a number of types: Discretionary Trust – which is under a written Deed, usually the beneficiaries are members of a family and the Trustee is either an individual or corporation. Unit Trust – which is set up under a written Deed whereby the units are owned by other entities. This often used as a joint venture vehicle and percentages of ownership of each unit are set out. Resulting Trust – this is a legal mechanism from the Court whereby a person acquires property with their own money but may not be on the title to the purchased property. The Court will recognise their interest and that the registered owner holds part or all of the property on resulting trust.1

Sally Nash

Jim Johnson

Constructive Trust – arises where there is a promise for an event to occur and upon that event property will be transferred. Constructive trust is imposed by the Court by reason of the conduct of the parties. There must be some element of joint endeavour and it would be unconscionable for the Court to allow the owner of the trust property to retain such ownership adverse to the interest of the person claiming ownership of the property. Generally the Court would regard the constructive trust as having some element of joint endeavour.2 Fixed Trust – arises where there is an express trust for an identified entity without any of the ordinary questions of discretion that might apply. It is very similar to a Unit Trust. Sometimes it can be called a “bare trust”.

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

Australian Business Number (ABN) It is absolutely essential that the provider of credit be aware of who they are dealing with. In this respect in most trade credit relationships the party seeking credit will have an ABN – the problem with this is that if it is a trust the ABN registration will only identify “trustee of the XYZ trust” and not the identity of the trustee. It is the trustee to whom you are providing credit. Within the ambit of the credit approval process it is necessary to properly identify the legal entity which is trustee of the relevant trust. The trust mechanism occurs more and more often both in personal and corporate administrations. Usually the first two types of trusts, operating through either a company or an individual obtain an ABN. This is to distinguish the trust trading venture from that of the individual Trustee. The trust is not a separate legal entity. Because a separate and identifiable ABN is required for each trust many credit providers assume that the trust is its own legal entity. The incorrect assumption that the trust is different to the trustee arises as a consequence of tax law where for revenue purposes trusts are dealt with as separate identifiable entities. This of course does not change the fundamental position that the trustee is not a separate legal entity and is able to sue and be sued in its name by its “trustee”. It must be remembered that once the credit agreement has been established that contract is with the then existing trustee and not with any subsequent trustee of any trading trust. Although there may be an argument that if there was a change

Credit Management

in trustee and the credit is provided only in relation to and by reference to the ABN the new trustee is the one that incurs the liability. Trusts cause difficulties for enforcement of contracts and judgments. This is particularly so when viewed in

circumstances of preservation of PMSI under the Personal Property Securities Act 2009. The legal position is that the liabilities of the Trustee of the trust, whether a person or company, are the liabilities of the Trustee. In other

words the Trustee must pay the debts that it incurs. The Trustee has a right of indemnity against the trust property. This is either at law e.g. Trustee Act, 1925 (NSW) or by reason of the terms of the written trust Deed. Therefore it is important to identify

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December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

the name of the trustee. An entity simply described as “XYZ Trust” is in insufficient for litigation or registration under PPSR. However for creditors the difficulty may be that the trust is hollow and has no assets against which the Trustee can recover. In these circumstances the Trustee is insolvent and can be wound up or made bankrupt for recovery of the liabilities of the Trustee of the trust. If there is no money left in the trust or assets left in the trust there is nothing against which the Trustee is able to claim indemnity. There is no separate register into which a search can be made as to whether or not the debtor is a Trustee of a trust. Trust Deeds are not registered on any register either with ASIC or Land Titles Office in any State. The exception being that a change of Trustee has to be registered: s. 6 and s. 9 Trustee Act, 1925 (NSW).

Personal Guarantee It is therefore very important to have a personal guarantee whereby the beneficiary or shareholder guarantees the trustee’s obligation. The personal guarantee must be in writing and physically witnessed by a person whose name and address are printed. An electronic signature on email is not recommended as there are issues with the authority to use electronic signatures. Unless expressly given a guarantee will not be binding if an electronic signature is used.3 Further the guarantee should be a separate document and separately signed. So there is no doubt as to the basis of signing the personal guarantee a witness to the signature should be required. A signature as director of the trustee or trust is not sufficient to create a personal guarantee or liability.4

Requirement for Writing Generally a trust must be in writing5. It is a requirement of Australian law. Regrettably the exemption is the resulting and constructive trusts

There is no separate register into which a search can be made as to whether or not the debtor is a Trustee of a trust. which are not usually in writing where the very existence of the trust arises as a consequence of conduct existing between the parties.

Ipso Facto Clauses An ipso facto clause is one where the Trustee of the trust is automatically removed upon an insolvency event such as liquidation, bankruptcy, voluntary administration, receivership or control being given to an insolvency practitioner. It means there is no Trustee in control of the trust assets. However, until a new Trustee is appointed in terms of the relevant trust the old trustee remains a “bare trustee” with limited powers being powers merely to preserve the property of the underlying trust pending either an order of the court or appointment of the new trustee at which time the property of the trust will vest in a new trustee or in terms of any order of the court. This causes issues in a liquidation as the liquidator has to have a Receiver appointed over the trust so he can get access to the trust property to pay the creditors.

Insolvency If the Trustee is insolvent and a Liquidator, Receiver or Trustee is appointed the assets of the trust may be more difficult to access because the right of the Trustee is limited to being indemnified from the trust property. Expressly, in the case of personal bankruptcy Section 116(2)(a) of the Bankruptcy Act6 excludes trust property from vesting in a Trustee in Bankruptcy. It is now common practice for the liquidator and on occasions a voluntary administrator to apply to the Court for the appointment of

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

a Receiver over the trust property. Indeed the current status of the law in relation to company liquidations was that the liquidator could sell trust assets without the appointment of a Receiver.7 Generally it has now been determined that a separate application for a Receiver over trust property must be made by the insolvency practitioner having control of the Trustee. This is the only way in which the trust property can be realised.8

Remuneration The above two-step process in the liquidation or bankruptcy of the Trustee and the appointment of a Receiver gives rise to difficult determination of remuneration issues for the insolvency practitioner and makes them less inclined to accept an appointment where a trust is involved. Generally, fee approval of the Court is required where there is trust property involved.

Real Property Land In New South Wales the Registrar General does not recognise trusts or Trustees registered on title to land. This is because the registered owner of land owns it beneficially albeit there may be a trust mechanism involved. The liability for rates, land tax, the mortgage security creditors, and ownership is with the Trustee and the trust is irrelevant to determining the interest.9 The fact that there is a change of Trustee does not affect the relationship of the trust property to the former or the new Trustee. In New South Wales the trust is not registered at the Land Titles Office but the change of Trustee has to be registered to be effective: s. 6 and s. 9 Trustee Act, 1925 (NSW).

Credit Management

No Priorities for Payment A more interesting aspect is that it has generally been held that the priorities under Section 556 of the Corporations Act and Section 109 of the Bankruptcy Act do not apply in an insolvency of the trustee of a trust i.e. employees’ priority, FEG priority, other Administrator priority are not applied. Generally, all creditors whether employees or directors or trade creditors, rank equally and are to receive a distribution from the trust property on a pari passu basis. There is no provision in the Trustee Act to distinguish different classes of creditors.

Law Reform Because of the difficulty of administering both the financial affairs of the insolvent Trustee and of the trust which are separate structures, it is currently being considered whether to remove the ipso facto clauses. This would mean that the trust assets would still be under the control of the insolvent Trustee and available to the Liquidator or Trustee rather than the necessity of appointing a separate Receiver.

Recommendation 1. That for account customers the ABN site is accessed and “ABN Lookup” checked for the ABN of the entities to determine if it is a trust or regular trading entity. 2. Having regard to the foregoing it is absolutely essential that: a. the credit provider have a provision in any document evidencing the terms and

conditions of trade relating to notification of any change in trustee of the trading entity – so that the credit provider credit records can be updated together with fresh guarantees; b. the credit provider only operate in its dealings in with a recipient of the credit upon the approved ABN registration both so far as acceptance of orders and issue of invoices and statements; and c. that a personal guarantee be obtained from the shareholders or beneficiaries; d. consideration be given to an annual review of credit accounts particularly where a trust is involved to seek confirmation as to the identity of any Trustee. e. that the credit application be re-designed to consider a notification by way of a ticka-box form as to whether the credit applicant is a sole trader, partnership, company or trust. 3. If there is a trust involved, then guarantees from the beneficiaries not just the directors should be obtained – although in the case of discretionary trusts this may be difficult. 4. Similarly, we would recommend where there is a large account involved and the directors and shareholders are different people that personal guarantees be obtained from the shareholders of the corporate Trustee. 5. If a large account is involved, that property searches be obtained and

Because of the difficulty of administering both the financial affairs of the insolvent Trustee and of the trust which are separate structures, it is currently being considered whether to remove the ipso facto clauses.

if, for example, the director’s wife owns all property that a personal guarantee be obtained from her. 6. In circumstances where goods are supplied which have serial numbers attention needs to be given as to whether or not as part of the trade supply, leaving aside for a moment PMSI provisions, it is necessary to register according to serial numbers and then whether or not other provisions of the Personal Property Securities Act 2009 can give rise to an extinguishment of any security interest perfection because the goods were acquired for resale or as part of for example the real estate development. 7. Where there are substantial credit arrangements being put in place consideration should be given to the entry into of a General Security Agreement that would be an ALLPAP in terms of the Personal Property Securities Act 2009.

*Sally Nash is a Solicitor at O’Neill Partners Commercial Lawyers Incorporating Sally Nash & Co. Ph: (02) 9232 1244. *Jim Johnson is a Barrister at the Sydney Bar. Ph: (02) 9229 7333

FOOTNOTES 1

Calverley v Green [1984] HCA 81; (1984) 155 CLR 242; (1984) 56 ALR 483

Muschinski v Dodds [1985] HCA 78; (1985) 160 CLR 583; (1985) 62 ALR 429

Williams Group Australia Pty Ltd v Crocker [2016] NSWCA 265

Reozone Pty Ltd v Rene Santoro [2016] NSWSC 1383

Section 23C(1) of the Conveyancing Act, 1919 (NSW)

Bankruptcy Act, 1966

Kitay, in the matter of South West Kitchens (WA) Pty Ltd [2014] FCA 670; (2014) 224 FCR 408

Re Stansfield DIY Wealth Pty Ltd (In Liquidation) [2014] NSWSC 1484; (2014) 291 FLR 17; (2014) 103 ACSR 401

Agusta Pty Ltd v Provident Capital Ltd [2012] NSWCA 26; (2012) 16 BPR 30, 397 and as to priorities between parties claiming to be trust creditors: Independent Contractor Services (Aust) Pty Ltd (in liquidation) (No 2) [2016] NSWSC 106

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

C-suite executives support credit If CEOs, CFOs and COOs understanding credit’s strategic imperative it can add the highest value possible to a company. By Alexandra Cain*

The credit function is an increasingly important department in many businesses. The best organisations understand its ability to improve the financial performance of a business. But senior management support is required for credit to perform to the best of its abilities. Paul Brandalise, chief operating officer of IP Solved, an intellectual property law firm, understands this well. He says the role the credit team plays is critical to optimising working capital.

Paul Brandalise

“They ensure the liquidity position of the firm remains constant. That’s by keeping the average collection periods and other key metrics where they should be.” Brandalise says a secondary role is in collaborating and mentoring people who hold primary relationships with customers. “The custodian of that relationship is usually the fee earner, in our case the solicitor or the attorney. They juggle both the operational relationship and the financial relationship. “Our credit team works with our lawyers to ensure they build collection activity into their dayto-day workflow. Too often lawyers leave collections to the last day of the month, but it’s not an isolated activity; it’s something they should be doing constantly. Every time they talk or write to a client they should know the debtor position, and build that into the dialogue,” he adds. Brandalise says moving to a position where clients are billed on a progressive basis has been a focus, unless clients have very specific requirements. “Billing at the earliest opportunity is important because if you leave it and don’t bill for a month or two and then send a very large bill, that’s going to have a detrimental impact on the client’s ability to deal with that quickly.” Another initiative has been working on clients’ bills so they demonstrate value. He says clients should read a bill and understanding how much work’s been put in, so they rush out to pay it. “We’ve worked to improve the narrative component and the

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

communication aspect of a bill, that’s helped in removing the initial impediment to pay when a client gets a bill and thinks, ‘That’s a lot, I’m not sure what that’s about, I’ll call him next week,’ as opposed to saying, ‘Yep, got it,’ and then move to put that in the payment schedule.” Brandalise says dispute resolution is a focus. “The soft skills are really important when dealing with professionals and their clients, its about building that relationship so that lawyers welcome input from the credit team and see them as an important partner in the receivables management process.”

Automation ensures efficiencies For Geoff Butcher, group general manager commercial for paper business Spicers, enhancing the credit function’s ability to do its job properly is about making processes as streamlined and as customer friendly as possible. “We’ve automated our online credit application forms and processes, while retaining the necessary information, and put it online so customers can do it directly from the portal. That’s cut down time from the customer’s point of view and for us internally and has made setting up new accounts much quicker and easier,” he says. According to Butcher the business is continually looking at automation. For instance, in the last 12 months processes have been enhanced around release of sales orders. “It’s a seamless process where orders are automatically released and then blocked on exception if

Credit Management

Geoff Butcher accounts are either outside terms or above limits. But as soon as a payment is made orders are released

automatically, cutting out manual intervention. When an order is placed on hold, our sales representatives are kept informed of their customers’ status via smart phone applications.” Spicers has also recently consolidated collection processes. “We have businesses in each of the capital cities and previously we’ve had credit functions in each of those cities. But in the last 12 months we’ve centralised and standardised those processes, which has helped identify and deal with slow payers quickly, rather than rely on one person in each state to do it. It’s now more of a team effort.” He says the business uses settlement discounts to encourage customers to pay on time or in some cases earlier. “That helps reduce the

amount of working capital tied up in customer balances.” Where possible, the business allows credit card payments, which customers who collect rewards points appreciate. “We also do regular customer reviews with the sales people, looking into whether credit limits are appropriate. Sometimes we increase them, other times we reduce them,” Butcher adds. Spicer works closely with lawyers to help head off a problem before it starts. “We use our advisers to make sure we have our PPSR registrations set up properly so there’s no issue about retaining stock if there is a problem. But we work with our lawyers in a commercial way. It’s better than trying to go down the legal route.”

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December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

Bruce Anderson

All about attention to detail Running a successful credit team is all about empowering them to make effective credit decisions, using their skills and knowledge of the credit laws, says Bruce Anderson, managing director of Automated Retail Services, a specialist consultant to the downstream petroleum industry. “Without that, vendors risk the validity of an invoice and its terms and conditions. Having credit arrangements and security properly in place before goods and services are supplied is essential. That’s the starting point,” he says. Subsequent to that is sharing knowledge with customer-facing staff. “Staff must ensure credit documents are signed correctly by authorised parties and getting details such as the names of organisations correct is key,” Anderson explains. He says making sure equipment is not loaned before the appropriate paperwork is signed and ensuring staff understand the ramifications of getting that wrong is important. “The best credit teams know the current credit laws, in particular the practical requirements of the PPSA rules, and have adequate credit procedures in place to ensure the organisation’s credit position is secured.

“Sharing that information with staff is critical in ensuring all sales contracts meet current credit regulations. If staff understand the credit process they can add huge value,” says Anderson. One way to ensure the credit team delivers an optimum performance is to encourage them to attend some sales and management meetings. “I take the whole organisation through the credit results, various problems in the ledger and suggest initiatives to improve the results. We look at examples of what has worked and what hasn’t. We look at shorter payment terms in exchange for better commercial arrangements and to trade off with customers to reduce risk.” Common topics in these discussions include how to ensure a customer has completed a credit application correctly when the entity is a discretionary trading trust, or what to do when there are concerns an organisation might be in financial distress. Anderson says his focus is on empowering credit collectors. “They’re collecting the funds, so it’s important to make sure they’ve always got good tools and effective strategies available to assist customers to pay on time. Regularity is also critical. Don’t do the credit collection tasks all at the end of the month, do them each week. Then the customers become accustomed to getting a reminder if they don’t pay on time, which ensures prompt payment becomes more habitual with more customers across the organisation over time.” Demonstrating effective credit management is essential when it comes time to negotiating debtors’ insurance premiums. Says Anderson: “Insurers give a lower rate with more attractive deductibles when an organisation can demonstrate the credit book is well covered and the credit procedures are effective. That’s a big part of getting this right.”

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

In addition, having an empowered and effective credit team can assist in sales performance by negotiating higher insured limits for customers, which makes a difference to meeting sales targets with less risk. He says having correct PPSR registrations in place with correctly completed credit applications with original signatures and dates is especially important when dealing with administrators and liquidators. “A liquidator is not going to be able to recover funds easily from you in a claw back scenario when you’ve got your security in place and all your credit documents conform with the current credit regulations. “More importantly, stock or equipment supplied on credit to a customer can usually be recovered from a customer’s site when an administrator is appointed. Ensure customers and suppliers correctly sign credit documents. Make sure stock or equipment has been identified and notified to the administrator at the time of their appointment.” Anderson’s final piece of advice in the event of a major credit issue is to go on site and do a stock take of all goods or equipment that have been supplied and not paid for. “As soon as you hear there’s a problem make sure you have staff on site to talk to the customer, find out where the stock and equipment is and ensure the customer or administrator understands that’s your stock or equipment. “A good example in the petroleum industry is fuel stored in vehicles running tanks at the time of the issue, which is often overlooked and can add up to a sizable sum. By completing a complete stocktake on site, you’re in a better position to reduce any exposure before any action is taken by an administrator or liquidator,” he says.

*Alexandra Cain is a freelance finance journalist who has written for many leading Australian and international business publications.

Credit Management

ASIC prosecutes business adviser

who assisted a director to breach his statutory duties By Peter Marsden* ASIC has written to company directors highlighting the need for caution when contacted ‘out of the blue’ by advisers seeking to assist them in cases of supposed financial distress. Notices of winding up applications are required to be lodged with ASIC and are therefore readily available for public inspection. A number of professional firms (lawyers and insolvency practitioners) distribute daily lists of such notices to professional (and other) contacts. A notice of winding up application is usually an indication that the relevant company may be in some form of financial distress. There are consequently a number of professional (and other not-so-professional) advisers who will be keen to offer their

Peter Marsden

advice and services to the directors of that company. It is apparent that a small number of these advisers are suggesting actions which may be considered illegal. These actions can lead to serious consequences for directors including large fines or imprisonment. Warning signs of potentially bad advice include: zz offering ‘the impossible’ zz suggesting the transfer of business or assets to another company without adequate payment zz reluctance to provide their advice in writing zz indications that they have access to a ‘friendly’ liquidator zz suggesting the destruction of books and records or withholding them from an appointed liquidator ASIC is attempting to identify these advisers and the liquidators to whom work is referred and has asked that directors notify them if they are contacted. In the meantime, ASIC has also written to registered liquidators noting their concerns against coldcalling directors in such situations and requesting that evidence of any such misconduct be reported to ASIC. Clearly, directors who believe their companies may be in financial distress should consider contacting a qualified practitioner as soon as possible. However, cold-calls from ‘self-proclaimed specialists’ can result in directors not receiving the best advice for their circumstances. The ATO and ASIC have recently conducted raids on 13 businesses

and residences across the country in a bid to crack down on those ‘preinsolvency’ firms who have allegedly encouraged phoenix activities, tax avoidance, and GST evasion. The petitioning creditor in many winding up applications is the Deputy Commissioner of Taxation (ATO) or the Workers Compensation Nominal Insurer. The creditor will have received a consent to act from an official liquidator known to the creditor (or their legal advisers) and such liquidator is, therefore, likely to be an appropriate person to deal with the proposed liquidation. It is frequently the case that directors of the companies involved in these matters are cold-called by advisers and promised an immediate solution to their problems by having the company placed in voluntary administration prior to the case being heard in court. The court is then often persuaded that there is no benefit to the creditors in replacing him/her with another appointee effectively chosen by the creditor. In view of ASIC’s growing concerns in this area, we suggest that creditors (including secured creditors) should be on the lookout for appointments made immediately prior to the hearing of the winding up application and consider whether such an appointee is appropriate. *Peter Marsden is National Head of Restructuring & Recovery for RSM Australia Pty Ltd. Phone: (02) 8226 4500 Email: Peter.Marsden@rsm.com.au

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Legal

Unfair preferences and how to avoid them – Part 3

This is the third part of a 3-part series on a practical summary of the law concerning unfair preference claims. In this part, I will: • discuss how you can reduce your chances of receiving a preference claim; and • provide a checklist on what to consider if a preference claim is made against you. By Nick Cooper*

How can you reduce the chances of a preference? a) Encourage the debtor company to pay its creditors proportionately. The Corporations Act encourages insolvent companies to pay all their creditors proportionately – by penalising those that have received a preference. The best way to avoid a preference is for the debtor company to adhere to this objective. This may require the company to appoint a Voluntary Administrator and creditors agreeing to a Deed of Company Arrangement. Payments made to creditors under a Deed of Company Arrangement are not liable to be repaid as preferences – even if the Deed is terminated and the company enters liquidation, as suggested by the reasoning in case Cresvale Far East Ltd v Cresvale Securities Ltd (2001) 19 ACLC 659. b) Trade on a COD basis. As mentioned above, where trading is on a cash-on-delivery basis there is no debtor/ creditor relationship. Therefore COD payments are not liable to be repaid as preferences. However, it is common for credit managers to place customer accounts on stop credit until a pre-existing debt is repaid. Whilst the COD payments are protected, any payments towards the pre-existing debt can be liable to be repaid as preferences.

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

Nick Cooper

c) Take security – register on the PPSR. Payments to secured creditors cannot be deemed as preferences (subject to the value of the creditor’s security). If security is taken over a company’s assets at the same time as advancing credit, then the payments cannot be preferences. However, if a security was granted over a pre-existing debt within the six months, the security may be void as against a Liquidator. Furthermore, in some circumstances the granting of security itself can be a preference if the security was given within the relation-back period. If you supply goods, registering your security interest over the customer on the PPSR is a costeffective way of preventing preference claims (and reducing bad debts). However, the law relating to PPSR is still developing. It may not be a complete answer to a preference claim, depending how the Courts will treat the value of the security against the value of the preference claim. d) Exercise a lien. In the case Bennett and Co v CLC Corporation (2001) 37 ACSR 96 – it was held that the holder of a lien is effectively a secured creditor for the purposes of an insolvency administration. Whilst that case did not concern a preference claim, it has the potential to suggest that payments to holders of liens cannot be preferences, on the basis that the creditor

Legal

has security. Once again, there is some uncertainty as to when this form of defence might apply. For example, the defence is likely to apply where a creditor has a right to enforce a lien and then has enforced that right and then receives payment. It may not apply where a creditor has a right to enforce a lien but hands back the property over which it could have exercised the lien and then receives payment. e) Request personal guarantees. When your suspicion about a debtor company’s insolvency arises, a further form of protection is to request that the directors (or the individuals behind the company) guarantee your debt. Whilst payments from the company are at risk of being preferences, you will have some recourse against the guarantors (provided they have sufficient assets). Usually, there is a high degree of reluctance by directors to give guarantees to trade supplies. However, you may have greater bargaining power to request guarantees if the company needs your goods/services to continue trading. The guarantee ought to be worded as a “personal” guarantee rather than a “director’s” guarantee to avoid the claim by a director who resigns that the guarantee is no longer binding on him or her. f) Take the risk. It is human nature to want a customer to repay the whole of its debt even though you suspect that by receiving payment you might be subjected to a preference claim at a later date. It might be that even if the company is insolvent, it will enter Voluntary Administration and then enter a Deed of Company Arrangement (“DOCA”) in which case you would not have to repay the preference unless the DOCA fails. But if the debtor company does enter liquidation within the six months, and you are confronted with a preference claim, there is often the opportunity to settle the Liquidator’s claim for less than the full amount claimed. The earlier in time that a preference claim is settled, the greater discount the Liquidator may be prepared to take. The longer a preference claim takes to resolve, higher legal costs will be incurred and a Liquidator may be unwilling to offer a discount on the claim.

Action plan if you receive a preference claim from a Liquidator 1. Check that the Liquidator is not out of time (statute barred) from issuing the claim – 3 years from the relationback day, or 1 year from termination of a DOCA. 2. Check that you did receive the payments claimed by the

Liquidator. Payments to suppliers with similar names can create confusion. 3. Verify that the payments were within the permitted timeframe – the “relation-back” period. 4. If you are in doubt whether the debtor company was insolvent at the time of the payments, ask the Liquidator for evidence of the company’s insolvency – such as the financial records of the company or a Report on Insolvency. Consider seeking your own opinion or report from another insolvency practitioner if you are still in doubt. 5. Consider whether you have a running account defence. This will involve determining the balance of the debtor company’s account over the relation-back period. If, after this analysis, you believe you have a partial or complete running account defence, write to the Liquidator asking that the claim be amended or withdrawn. 6. Consider whether you have a defence of no reasonable grounds to suspect insolvency [s. 588FG(2)]. Has the Liquidator provided reasons why they believe this defence is not applicable to you? If you believe that this defence applies, write to the Liquidator and explain why you consider this defence applies. It is useful if you can state that you continued to give credit to the debtor company after you received the payments (and therefore did not suspect insolvency) – although this will not always be a defence as further credit may be given to an insolvent company to induce payments for an old debt. 7. Consider of you are a secured creditor (PPSR registration), whether you exercised a lien before the payment, or can claim a set-off. 8. If you consider that the defences may not apply, or wish to avoid the risks of litigation, attempt to settle the claim for an amount less than the claim. Sometimes Liquidators will settle preference claims at a discount, before legal proceedings are issued, to save their own legal fees. 9. If you are in doubt at any stage, seek legal advice. *Nick Cooper is a Partner of the Adelaide office of Worrells Solvency & Forensic Accountants. He is qualified as a Chartered Account and hold a Bachelor of Laws. He is an Official Liquidator and a Registered Trustee in Bankruptcy. Nick has worked in the insolvency practice for 20 years. He has acted as an Administrator, Liquidator and Receiver of companies in a diverse range of industries. He has acted on behalf of major banks and in respect of clients of many accounting firms. In his role as a Liquidator and as a Trustee in Bankruptcy, Nick is often involved in litigation to recover assets for the benefit of creditors.

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Legal

Sign of the times – What has your customer signed?

By Bonnie McMahon and Hayley Hitch, Solicitors and Stephen Mullette, Principal of Matthews Folbigg Lawyers, in our Insolvency, Restructuring and Debt Recovery Group

Bonnie McMahon

Hayley Hitch

Times are changing with the introduction and advancement of technology every day. This has led to innovations, even in the last bastion of luddites, in the legal industry. Court documents may now be solely filed online; Contracts for Sale of Land may now be signed and exchanged electronically; and electronic signatures may be placed on agreements and guarantees and considered enforceable, in certain circumstances. However, when the lawyers get involved, you know the legal arguments will closely follow. Is an electronic signature enforceable? Against whom? The person whose signature it is? What if the signature was affixed by someone else? When will this bind the person whose signature is involved, and further, the entity they represent (for instance their company)? Most importantly, what can creditor do to protect themselves against disputes about the execution of credit applications and contracts where the signature is an electronic one?

Electronic Signatures

Stephen Mullette

First of all, there is now such a breadth of technology available, it is necessary to think about what

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

an ‘electronic signature’ actually means. Or for that matter, what is a signature? When lawyers get involved even that question is not necessarily as simple as it sounds, and although this is not the focus of this article, it is important to be aware that there have been cases in which “’Signature’ in this case, obviously, does not mean the personal signature of the Minister” (Williams v Silver Peak Mines Ltd (1915) 21 CLR 40 at 47–48, in relation to notices published in a Government Gazette purporting to be signed by a minister), and where unsigned documents from an agent of the Official Trustee in bankruptcy, which had her typewritten name at the end of it, was a form of “signature” sufficient for the relevant provision of the Bankruptcy Act 1966 (Coshott v Coshott [2010] FCA 300). In electronic terms, an electronic signature could include typing an individual’s name, placing a copy of a computer file (for instance a jpg file) containing an image of an individual’s signature in an appropriate field, clicking an ‘I Accept’ box, or using a personal identification number. A second preliminary issue is a practical one which arises in all matters, electronic or otherwise.

Legal

When a document is signed electronically, it is vital to ensure that the relevant terms and conditions that are to be agreed upon by the parties are able to be identified from the signed document and have been made available (and remain available) to the customer. Ideally the signature and the terms are held by the relevant company together as one document. This becomes problematic as terms and conditions become documents placed on websites, and are altered from time to time. It can become a large issue to confirm which version of the company’s terms and conditions were in existence at the time the contract was entered into, and also, what evidence there is that these terms were accessible and were agreed by the consumer.

Electronic Transactions Legislation Over the past 2 decades, the Australian government has attempted to provide protection for parties entering into transactions either wholly or partly by electronic means and to progress together with the change in technology. With the introduction in 2000 of the national scheme of Electronic Transactions Acts (“the ETA Scheme”) in the Commonwealth and all states and territories (with the initial exception of Western Australia who came on board in 2011), it seemed as though Australia was on track to increase the certainty of electronic transactions. This legislation was introduced as “part of the Government’s strategic framework for the development of the

When a document is signed electronically, it is vital to ensure that the relevant terms and conditions that are to be agreed upon by the parties are able to be identified from the signed document

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Legal

information economy in Australia” and set about “ensuring that Australians enjoy the social and economic benefits offered by the growth of the information economy” (Electronic Transactions Bill 1999 Revised Explanatory Memorandum).

It’s a Crocker! However, the recent decision in Williams Group Australia Pty Ltd v Crocker [2016] NSWCA 265 (22 September 2016) (“Crocker”) has suggested that there are some significant limits to the usefulness of the ETA Scheme. This decision, by the Court of Appeal of the Supreme Court of New South Wales, raises a number of issues for creditors, especially those who allow electronic signatures to be used on credit applications and accompanying all-moneys guarantees. The creditor set out the stakes which were in issue (at [4]): “Williams raises the spectre that, if this appeal is not allowed, the ability of a trade creditor ever to rely on electronic signatures will be in real doubt.” Crocker involved an appeal by a creditor, seeking to enforce an allmoneys guarantee against a director of a company, now in liquidation. The guarantee and the accompanying credit application had been signed electronically by all three directors of the company, apparently witnessed by the company’s administration manager. The signatures had been placed on the documents using a system known as HelloFax, which required a username and login before the signature would be attached to the documents, which was then faxed to the creditor. On the basis of the credit application and guarantees the creditor supplied goods on credit totalling $889,534.35 before the company was wound up. Summary judgment was obtained against the 2 co-directors,

It can become a large issue to confirm which version of the company’s terms and conditions were in existence at the time the contract was entered into, and also, what evidence there is that these terms were accessible and were agreed by the consumer. however Mr Crocker argued that his electronic signature had been placed on the documents without his authority, knowledge or consent by an unidentified individual. As it transpired, Mr Crocker had been provided with a username and password by a member of staff. However he has not changed the password given to him since receiving it, which meant that any of his co-workers with access to his login and password could have gained access to his account and placed his electronic signature on the documents. The evidence disclosed that Mr Crocker had used the system to affix his signature to a credit application (and guarantee) for a different supplier, only a few days before the relevant documents were signed, and on a number of occasions subsequently. However Mr Crocker was able to provide evidence of the fact that he had not been the person to place his electronic signature on the document, that it had been affixed in a different office of the debtor company from the one in which he was located at the time. The trial judge considered it important that the signature used was different from the one Mr Crocker had himself loaded when setting up his registration in the system. The trial judge was satisfied that Mr Crocker had not provided his authority to any person to affix his signature using the HelloFax system, and that it has

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

been affixed without his knowledge or consent, that he had not seen the email notifications which would have been sent to him that his signature was in fact being used, and nor did his subsequent conduct ratify the use of his signature for the guarantee. The trial judge dismissed the claim and the creditor appealed.

The Court Of Appeal Judgment On appeal, the creditor did not dispute the trial judge’s finding that there was no actual authority for Mr Crocker’s signature to be used on the guarantee. Rather, it argued: zz Mr Crocker gave ostensible authority to whoever it was who affixed his signature, given he failed to change his password and ID and uploaded his signature to the system; essentially the creditor was arguing that the establishment of a system for attaching electronic signatures was a representation to trade creditors that the signatures had been authorised; zz Mr Crocker had ratified the guarantee; zz Mr Crocker was estopped from denying the guarantee was operative. The Court of Appeal of the Supreme Court of New South Wales dismissed the appeal. Firstly, the Court of Appeal held that in order for the use of his signature by someone else to

Legal

be binding upon him, Mr Crocker must in some fashion have made a representation to the creditor that his electronic signature had been placed with his authority, and in turn the creditor must have relied on the representation. However: zz Mr Crocker did not implement the Hellofax system, he merely “participated in its use” (at [67], and his use of such a system could not be a representation by Mr Crocker that others were authorised to use it to affix his signature; zz Given Mr Crocker did not know the documents had been signed the creditor could not have relied upon his adoption of the system as a representation in any event; zz Mr Crocker’s failure to change his password for the HelloFax system did not “arm” anyone at the company to use his signature and so did not amount to holding out to the creditor that any person had authority to affix his signature; and zz The systems used may well have been representations made by the company or by other officers or employees that Mr Crocker was authorised to bind the company, but did not amount to representations by Mr Crocker that someone else could affix his signature to a document. Insofar as ratification was concerned, the Court of Appeal found that the mere fact that an email had been sent to Mr Crocker showing his signature had been affixed, did not give him sufficient notice of the guarantee to be bound by it. Nor was the court persuaded that Mr Crocker should be treated as having knowledge of the guarantee because he “shut his eyes to the obvious” (at [128]). The Court wasn’t satisfied that this was the case, as the system would not have shown that his signature would have been affixed to a guarantee, merely to the credit application. The Court did not accept the

estoppel argument either. The only representation the Court was satisfied had been made was that Mr Crocker’s signature was on the guarantee. Even if the creditor had relied upon it, this was not a representation by Mr Crocker and did not preclude him from denying personal liability on the guarantee. In a point which the Court did not need to decide, but which will become relevant in other cases, the Court held that it was not clear whether an electronic signature which was affixed without authority, could amount to a “forgery” in accordance with the case law. This will become important because Mr Crocker argued that if this was the case, then the law is that a forgery cannot be ratified, so that even if the evidence against him had been stronger, he could still not have been held to have ratified the guarantee. In the end the Court of Appeal dismissed the appeal and ordered the creditor to pay the costs of Mr Crocker.

What Does this Decision Mean for Electronic Signatures? The result in Crocker means that creditors need to be extra cautious when conducting transactions either partly or wholly through an electronic medium. It is perhaps impossible to put the genie back in the bottle, and suggest that creditors should stop using electronic means to conduct business. In the digital age, electronic signatures are ubiquitous. From emails, to letters, to formal legal documents – they are convenient, and allow for documents to be sent whilst the author is unable to place a physical signature

on a document, or where a document is being signed on someone’s behalf. But this begs the question – with actual signatures being scanned and sent in an electronic form, it is often impossible to tell whether a signature provided electronically was original or electronic in its initial form. So what use is the ETA scheme? The creditor in Crocker appeared to have believed that Mr Crocker’s signature was legitimate, especially as it was provided to them by facsimile. It is not clear what more the creditors could have done to protect without physically attending and witnessing the guarantors each execute the guarantee. Any further protection will to come from the courts. In Crocker, Justice Ward (with whom Simpson and Payne JJA agreed) acknowledged the creditor’s concern about the (lack of) usefulness of electronic signatures, but held that “If it is the case that drastic consequences flow from the application of the principles relating to ostensible authority and ratification in the electronic signing context, that may be a matter for the legislature to address” (Crocker at [4]). It is too early to know whether the government will respond to the difficulties with electronic signatures raised in Crocker and whether it will consider further protections and certainty for creditors entering into electronic transactions.

So where do I sign? Until there is any legislative reform it is important for creditors to consider what processes they will adopt to minimise the risk of unenforceable

The result in Crocker means that creditors need to be extra cautious when conducting transactions either partly or wholly through an electronic medium.

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Legal

Section 10 of the Electronic Act sets out the requirements for use of an electronic signature agreements, arising from electronic signatures. So what steps can creditors take? Pursuant to s 187 of Schedule 1 of the National Consumer Credit Act 2009 (Cth) (“the Credit Act”), a contract, mortgage or guarantee may be signed by use of an electronic signature and declared effective in accordance with the Electronic Act. Section 10 of the Electronic Act sets out the requirements for use of an electronic signature, being: 1. A method is used to identify the person and to indicate the person’s intention in respect of the information communicated; and 2. The method used is reliable or proven in fact to identify the person and the person’s intention; and 3. The signature is in accordance with any IT requirements of the entity; and 4. Consent must be given by the person receiving the signature to use of an electronic signature as a method of signing. In Crocker, the system maintained by the company included a confirmation email sent to the director/guarantor regarding use of his electronic signature. However: zz The creditor was not able to prove that Mr Crocker received, opened or read such email; and zz The creditor was unaware of the existence of such emails until the proceedings had been commenced. It would have been open to the creditor to have confirmed Mr Crocker’s identification, sent its own confirmation email, confirming

his electronic signature was placed on a contract at the time, and that the contract was now binding. It is possible, that in those circumstances, the end result of the case would have been substantially different. However there remains the difficulty regarding use of an email address for confirmation. Much in the same way the electronic signature was able to accessed by persons other than Mr Crocker, so to could it have been said that the confirming emails were either not received, or if a response was sent to the creditor, that it was sent by someone other than Mr Crocker without his knowledge or permission. Nevertheless, the more communication with the guarantor, regarding provision of the guarantee, the greater the chances of proving the guarantor was aware of the execution of the contract using his or her electronic signature, and the greater chance of success of the estoppel, representation and ratification arguments which failed in Crocker. Whatever steps are taken, if an electronic signature is or may be used when entering into a contract, the question needs to be asked – how will I be able to prove the connection between the person whose signature is on the document and their intention to be bound by the document. A further issue arises with an electronic signature in regards to the witnessing of such signature. What does a witness of an electronic signature even mean? The whole point of an electronic signature is the lack of formal execution, so in what sense is it even possible for someone to witness an electronic signature? An electronic signature is not required to be witnessed, so long as the entity that is

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

to receive and rely upon the electronic signature consents. If a witness is to be required, the same issue exists whereby identification and intention of the witness will be required to be proved by the creditor company. Abandoning the use of electronic signatures in this day and age is just not a possibility. The world will only become more reliant upon technology and avoiding use of such technology will only leave a company falling behind in the industry. This issue also arose and continues to exist on the introduction of websites for order forms, supply arrangements and the establishment and variation of terms and conditions.

Conclusions Should creditors wish to enter into contracts with customers electronically and allow the use of electronic signatures, then at the very least consideration should be given to establishing a process to confirm: zz Who affixed the electronic signature; zz The authority of the person to affix the electronic signature (if not affixed by the person whose signature it is); zz Evidence of the knowledge of the relevant person that his or her signature has been affixed, and to what contract (if both a credit application and a guarantee, for instance). Failure to put such process in place may make the enforcement of electronic contracts much harder, and may cause a substantial loss to your company in the future, should the relevant customer default on payment in accordance with the contract. There are also other forms of technology that may mitigate authentication risks (such as public key cryptography) and you should seek both legal advice and IT advice in respect of the effectiveness of the systems in place in your company.

Software

SOFTWARE TIP:

Reporting - audit control By Beth Gray FICM CCE*

Companies strong on audit control run regular reports to identify any master data changes.

Beth Gray

In the last article, we highlighted the importance of correct master data. Correct data creates a strong foundation to allow us to manage our company risk, policies and audit control. Is your company exposed to poor risk management, fraud or embezzlement? Can the staff change contact details, addresses, or bank account details? And if so, on what authority? Do they keep a record of the request from the customer? Is anyone checking what has been changed in SAP to ensure it matches with customer request? What policy or procedures do you have in place to guarantee strong risk management? Companies strong on audit control run regular reports to identify any master data changes. Regularly reviewing all changes made to master data fields ensures that only approved changes, by authorised staff have been made. There are several reports available in SAP which provide management excellent visibility of field/s that have been changed, by which user login and when. For example, did “Sally” change the address or phone number? Or more importantly the bank account details for your customer/vendor which would affect payments of supplier invoices, rebates or refunds etc. Any changes made to the master data can be viewed by using transaction code: S_ALR_87012182

(Display Changes to Customers). If you are not currently reporting on changes to your master data which may lead to being exposed to risk, fraud, or embezzlement, this report should be added your EOM procedures as part of strong audit control. Auditors (external and internal) often require this type of report as part of their finance department review. Whilst we often talk about “know your customer” for better risk management, we also need to be mindful that our own business is following company policy and adhering to strong audit control. Use the power of networking with your peers, join the SAP User Group. Enhance your day-to-day work by benchmarking for best in class processes and procedures. #WhatYouDontKnowCouldCostYou Beth Gray FICM CCE is Director of SAP Users Pty Ltd Website: www.sapusers.com.au Email: beth@sapusers.com.au #WhatYouDontKnowCouldCostYou

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

Economy

Small business risk update By Colin Porter* Bad debt exists on a larger scale when all segments of the market are taken into consideration.

Commercial credit-reporting bureau, CreditorWatch, recently conducted an analysis of internal and aggregated data to highlight potential risk and trading insights for Australian creditors. The analysis reviewed registered payment defaults and trade payment data sourced from over 40,000 active members across Australia. The data represents an accurate status of behavioural trends as it looks at entities of all sizes in addition to corporates that are generally considered “critical suppliers”. CreditorWatch customers range from small businesses and noncritical suppliers through to ASX listed companies. According to ASIC insolvency statistics, there were 9,848 Australian insolvencies for the 2015-2016 financial year. This however, does not include failures of sole traders, partnerships and trusts, a segment of the market that traditionally goes

unreported on government statistics, and is not regulated in the same way as companies by ASIC. Colin Porter, managing director at CreditorWatch said “as a credit reporting bureau that provides credit reports on both incorporated and unincorporated entities, we are able to identify changing behaviours by analysing statistics on all entities including companies, sole traders, partnerships and trusts.” Payment defaults have risen significantly by 90% and 63% in Q2 2016 and Q3 2016 from the previous year. These findings along with ASIC’s annual result of 9,848 national insolvencies, otherwise suggests that unsuccessful entities have risen significantly, when the unaccounted segment of the market is taken into consideration. The rise in payment defaults in the last two quarters is likely an early warning to expect court actions to

Table 1 – Payment Defaults (National)

Quarterly Year on Year %

National Payment Defaults

Q3 2015

Q4 2015

Q1 2016

Q2 2016

Q3 2016

-4%

90%

63%

Data sourced via CreditorWatch’s national database of registered defaults

Colin Porter

“As a credit reporting bureau ... we are able to identify changing behaviours by analysing statistics on all entities

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

Economy

Table 2 – State breakdown of Court Actions

Quarterly Year on Year % Q3 2015

Q4 2015

Q1 2016

Q2 2016

Q3 2016

QLD Court Actions

-13%

-1%

-6%

-18%

-50%

NSW Court Actions

-5%

-4%

-19%

SA Court Actions

66%

19%

-14%

-2%

-26%

VIC Court Actions

-27%

-24%

-9%

-4%

-11%

WA Court Actions

73%

98%

99%

42%

175%

Data sourced from courts around Australia. A slight variation may occur each quarter due to time lags in accessing total monthly figures

increase in Q4 2016 and Q1 2017 as suppliers will register defaults before taking debtors to court. The state breakdown of court actions conveys 2016 as having mostly levelled trading conditions, however it is evident that entities trading in WA are suffering due to the significant increase of court judgements every quarter from the previous year. The results, coupled with the high volume of national payment defaults ultimately reflects a need for greater caution to be taken when trading and providing credit in Western Australia.

zz Revenue growth appears to be levelled. zz Growing optimism amongst businesses as 42% expect to make more profit than the previous year. zz Taking on new customers is mostly perceived as an average risk amongst respondents (47%) zz Over half of respondents (54%) claim they feel confident of their trading decisions as a result of performing regular credit checks Porter says “after reviewing the survey findings, more and more companies have identified how easy accessing a business’s credit file is and are relying

on credit checks to identify risk and safeguard their credit decisions. It’s also a sign of successful education and that credit reporting is becoming increasingly accessible for all businesses.”

*Colin Porter is Managing Director of CreditorWatch About CreditorWatch CreditorWatch is a commercial credit reporting bureau with over 40,000 clients, from sole traders through to ASX listed companies. CreditorWatch provides credit risk information on any entity in Australia and assists creditors by monitoring and sending alerts for risk indicators that may affect a debtor’s repayment ability.

Small Business Sentiment In addition to conducting an analysis to identify payment trends, Creditor Watch surveyed its members to identify small business sentiment for the coming year. Survey Key Findings: zz Cash flow and the Australian economy are still leading concerns for Australian businesses with nearly two thirds of respondents citing these reasons ahead of profitability, government regulations and taxation. zz No significant growth is intended with almost half of respondents (48%) citing no plans to employ more staff in the next 3-6 months.

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

PPS

How to use the Personal Property Securities Act when leasing equipment By Leigh Adams*

This story is an example of how you can lose your business without even trying. It’s the “unknown unknowns” that often trip up even the most diligent of small business proprietors. Recently we helped one of our clients on the brink of insolvency due to the unscrupulous behaviour of a person who was a “trusted friend” of that client.

Fred was winding down The trusted friend was Fred who was winding down his business. He was about to retire. Fred ran a private bus company and advertised one of his buses for sale. Fred had known our client Barney for many years. Barney ran a tourist company. It was expanding and Barney needed a new bus. Fred was keen to get the deal done quickly because he was going overseas for a long-overdue holiday the next week and offered a good price to Barney. Barney was tickled pink with the offer and paid for the bus the very next day. He handed over a bank cheque for $130,000 and took delivery of the bus at the same time.

Barney got a good deal – or did he? Leigh Adams

Barney felt quite chuffed at the significant discount that Fred had

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

offered him for the quick sale to a long-standing friend. That was in 2009. What Barney had failed to do in his rush to take advantage of Fred’s generous offer and what he would have been told to do by us, was to check the REVS register of encumbered vehicles.

The REVS Register At the time of sale, the REVS register showed that the bus was encumbered to ‘Sly Finance’ for $100,000. Barney was also unaware that the contract between Sly Finance and Fred was actually a hire-purchase contract and that it was Sly Finance which actually owned the bus, not Fred – even though the bus had been registered in Fred’s name. Barney began using the bus in his business, blissfully unaware of the problems that were lurking underneath the surface.

Fred renegotiated the equipment lease Fred had continued to make the monthly payments to Sly Finance after Fred’s so-called ‘sale’ of the bus to Barney. So Sly Finance thought that Fred was still using the bus in Fred’s business and there was nothing that had occurred to suggest to Sly Finance that anything was amiss.

PPS

Barney was also unaware that the contract...was actually a hire-purchase contract and that it was Sly Finance which actually owned the bus, not Fred – even though the bus had been registered in Fred’s name. Fred was enjoying his early retirement. And why not? It was being partially funded by the money Barney had paid him in 2009. In 2013, after the Personal Property Securities Act began operation, Fred’s hire-purchase agreement with Sly Finance came to an end. Fred did not want to pay the residual and obtain title as the contract required, for obvious reasons – he had ‘sold’ the bus to Barney four years before. Instead, he tenaciously negotiated

with Sly Finance to enter into another hire-purchase agreement.

Sly Finance registers its security interest The new hire-purchase agreement that Fred entered into with Sly Finance was on terms consistent with the Personal Property Securities Act (aka the PPSA). Sly Finance registered their security interest in the bus on the Personal Property Securities Register. Their lawyers said that this would

“perfect” the Sly Finance security interest in the bus. Sly Finance was told that it had nothing to worry about. But what Sly Finance had failed to do was to check that Fred still used the bus in 2013, when the equipment lease regarding the bus was renegotiated.

Fred’s plan falls apart In 2016, Fred’s spendthrift ways had caught up with him and he ran

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

PPS

out of money. He fell into arrears in making the monthly payments under the second (PPSA) hirepurchase equipment lease with Sly Finance. Sly Finance sought to repossess the bus, but of course Fred did not have it and had not had it since 2009. He told Sly Finance about the sale of the bus to Barney in 2013.

What can Barney do? Barney came to see us. He was very distraught. Sly Finance wanted to repossess the bus (which by now was only worth $30,000) and to recover from Barney the arrears of the monthly lease payments. The lease arrears plus interest on them totalled about $90,000. Barney had just moved his business into new business premises and he had just signed a contract for an expensive fitout. Sly Finance demanded $60,000 (being the $90,000 arrears and interest less $30,000 representing the current market value of the bus which it wanted to repossess). Barney would also have to find some money to buy or lease a replacement bus under another equipment lease. The whole situation was going to cripple his business. We had a long discussion with Barney. We explained to him that because of Sly Finance’s first equipment lease with Fred, Barney should have checked the REVS register before he paid any money to Fred. But he didn’t. And our due diligence had confirmed that Sly Finance had indeed registered their interest in the bus in 2009 on the REVS register. So Barney had bought nothing in 2009 because the public REVS register and Sly Finance’s equipment lease relating to the bus together indicated that ownership in the bus lay with Sly Finance. Fred could not sell what he did not own. And Barney

always find out where your equipment is located before agreeing to lend any money to finance it. was taken to have had notice of Sly Finance’s ownership interest because of the registration on the REVS register. But that hire-purchase agreement came to an end in 2013. Fred then entered into the 2013 hire-purchase agreement and purported to grant a ‘security interest’ in the bus to Sly Finance. However, section 19 of the PPSA says that Fred could only grant a security interest in the bus if he had ownership of it or possession of it, and Fred had neither. Sly Finance owned it, and Barney had possession of it.

Saving Barney So no security interest was granted in the bus at all in 2013. That means that Sly Finance’s claim against Barney for the arrears and interest was invalid. Sly had a claim against Fred for all arrears and interest under the 2013 hire-purchase agreement. They got a judgment against Fred. Sly Finance was so incensed about Fred’s dishonesty that they pursued Fred into bankruptcy, even though they were told by their lawyers that Fred had no money and his bankruptcy would not result in any payment to Fred’s creditors.

Lesson for Sly Finance Sly Finance had learnt through the school of hard knocks – always find out where your equipment is located before agreeing to lend any money to finance it.

Lesson for Barney Barney had paid for a bus that he did not own. He had to give it back to Sly Finance. Nevertheless, we were able

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

to save Barney from having to pay for all the arrears and interest under the 2013 hire-purchase agreement, and his business was saved.

Barney pursues Fred Barney wanted to lodge a proof of debt with Fred’s bankruptcy trustee for the cost of the bus ($130,000) plus interest on that sum for the period 2009 – 2016. However we advised him that as the debt was over 6 years old, he was statute barred from recovering it. If only Barney had seen us from the start!

What if Sly Finance had not registered on REVS? If Sly Finance had not registered its interest on REVS under the first equipment lease, then Barney would have acquired ownership of the bus when he bought it in 2009. The second hire purchase agreement in 2013 would have meant nothing because Fred had neither ownership nor possession and Sly Finance did not have ownership either at that time because Fred had sold the bus to Barney in 2009. So any registration of Sly Finance’s security interest on the PPSA could have been cancelled by Barney applying to the PPS Registrar under section 181 to delete the defective registration.

*Leigh Adams, Special Counsel and Accredited Business Law Specialist, Owen Hodge Lawyers LWA@owenhodge.com.au or Ph: +61 (0)2 9570 7844 PO Box 187, Hurstville NSW BC 1481

aicm Training News Recent graduates Statement of Attainment Rory Ratz

NSW

FNSICGEN304B, FNSCRDT403B, FNSCRDT401B

Karolinka Gruba

VIC

FNSCRD502 Manage factoring and invoice discounting arrangements

April Atthews

QLD

FNSCRD502 Manage factoring and invoice discounting arrangements

Jenny Willersdorf

QLD

FNSCRD502 Manage factoring and invoice discounting arrangements

David Mackintosh

VIC

FNSCRD401 Assess credit applications

Matthew McDonnell

FNSCRD502 Manage factoring and invoice discounting arrangements

Taylor Hewitt

QLD

FNSCRD502 Manage factoring and invoice discounting arrangements

Certificate IV In Credit Management Emma Hill

QLD

Amanda Carrick

QLD

In-House Training BOC Scottish Pacific – National Baiada Australia

Our 2017 Face to Face Training Calendar will be in our next edition To speak to AICM about these or any other learning or development, call 1300 560 996 or email andrew@aicm.com.au or debby@aicm.com.au Important Information: You do not have to be a current AICM student undertaking a full qualification to attend any AICM face to face training. You may wish to undertake a program for your professional development, or enhance and update your current skills and knowledge. On the completion of the face to face training, you will be required to undertake the online assessment/s for the unit/s of competency, if you wish to receive a nationally recognised Statement of Attainment. Please register you interest early, as there is a minimum requirement of 8 students to conduct face to face training.

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

2016 National C

John Hewson delivers keynote address.

National President James Neate presents SA President Gail Crowder with the 2016 President Trophy.

2016’s Recertifying Certified Credit Executives at the CCE lunch.

President’s dinner at Movieworld, pre dinner drinks.

Donna Smith, Lou Caldararo, Clara Caldararo, Sherif Hussein, Jeff Hurst and Tim Holden.

Nathan Wilkinson, Alexandra Croce, Anja Bonnard and Dale Hannan.

Delegates enjoying the President’s dinner.

recoveriescorp team at conference session – Amaran Navaratnam (Victorian Councillor) Brooke Lawrence and Nicholas Harrak (conference presenter).

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

CLICK HERE to watch overview video

Conference 2016 saw the AICM Conference back in one of our favourite cities, the Gold Coast. We had record early registrations when we

the AICM to hold such a vibrant and knowledge rich event. Thank you to all attendees and exhibitors too as you make the conference the leading credit event

announced that the conference venue was the

and the largest gathering of credit professionals in

renovated Sea World Resort which balanced the

Australia.

need for conference facilities with the fantastic Gold Coast location.

On these pages we’ve got some of the 100+ photos that we’ve published on the website.

Thank you to our Platinum sponsor Veda and Supporting sponsor Austral. Their support allows

CLICK HERE for our Survey

Dun & Bradstreet exhibitor booth.

Creditorwatch exhibitor booth.

AMPAC exhibitor booth.

Veda exhibitor booth.

Conference attendees playing Veda’s virtual reality game.

Results Legal exhibitor booth.

CLICK HERE to watch the highlights video

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

2016 National C Young Credit Professional 2016

Mark Russell Managing Director – Corporate, Insurance & Professional Services Dun & Bradstreet; YCP winner Fiyona Kidenya Collections Team Leader (Advertising) at News Corp; Simon Bligh CEO Dun & Bradstreet Australia and New Zealand; and Richard Gannon Group AR and Credit Manager News Corp The 2016 YCP was again a tightly contested competition with each state’s finalists being accomplished credit professionals and performing exceptionally well at the judging. The five finalists bonded over their shared experience of the judging process and their thoughts have been captured in video which is on the AICM website to assist future years candidates understand the process and career benefits.

NSW President Col Magee, YCP winner Fiyona Kidenya and NSW Vice President Balveen Saini. 38

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

The 2016 judges were Grant Morris, Maria Schandl, James Neate and Mark Russell. In particular thanks go to Mark Russell, Managing Director – Corporate, Insurance & Professional Services Dun & Bradstreet for working with the finalists and for announcing the winner at the gala President’s dinner. Well done to our winner Fiyona Kidenya of News Corp who represented NSW! Fiyona was supported by her manager Richard Gannon at the dinner.

National Finalists – Fiyona Kidenya, Ross Leggett, George Vahaviolos, Sarah Reed and Catrina Galanti.

CLICK HERE to watch the video

Conference

National finalists awaiting winner announcement.

President’s dinner.

National finalists at President’s dinner.

NSW – Fiyona Kidenya Collections Team Leader (Advertising), News Corp.

WA – Sarah Reed Credit Team Leader, Bunnings Group Limited.

VIC – Catrina Galanti Client Account Manager, Credit & Surety QBE Australia & New Zealand.

QLD – Ross Leggett Credit Manager – Northern Operations, Ruralco Holdings Ltd.

SA – George Vahaviolos Solicitor, CCC Financial Solutions Pty Ltd/EMT Legal.

CLICK HERE to watch the video

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

2016 National C Credit Team of the Year 2016

Winning Team – Wyndham Vacation Resorts Asia Pacific represented by Jennifer Pascucci, Courtney Guerin, Craig Tribolet, Jason Edwards, Lisa Mitchell and Shane Edwards Applicants for the 2016 CToY represented the breadth of AICM membership and is reflected in the 4 finalist teams and their managers: zz Australia Post – David Condello, National Legal Recovery Manager zz Cummins South Pacific – Janice Thomason, National Credit Manager zz Hyne Timber – Sarah Mizon, Credit Manager zz Wyndham Vacation Resorts Asia Pacific – Jennifer Pascucci, Vice President Consumer Finance The CToY is an excellent process for teams to enrol themselves in as it gives structure to a review of the team, the processes and achievements. A common

Runners Up – Hyne Timber represented by Sarah Mizon – Credit Manager, Emma Hill – Credit Officer and Zoey Suthers – Senior Credit Officer. 40

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

reflection at the conclusion of the process is that the team has really enjoyed working on the project together and they have some great tools to take back to the office. Congratulations to the winner Wyndham Vacation Resorts Asia Pacific, they’re an outstanding team and worthy 2016 CToY. Thank you to our judges Debbie Leo of Veda, Rhys Buzza of Reece and Simon Holloway of Carlton and United Breweries. Thank you to the awards ongoing sponsor Veda and specially Debbie Leo who is a driving force behind this award.

Courtney Guerin and Craig Tribolet of Wyndham Vacation Resorts Asia Pacific accept the award from Debbie Leo of Veda.

CLICK HERE to watch the video

Conference Wincollect AICM National Conference Golf Day Report 2016 The Wincollect AICM National Conference Golf Day 2016 was held at the beautiful Links Hope Island on Tuesday 11 October 2016. It was a fabulous success. Conditions were challenging in that there was a stiff breeze blowing, but the course was in an immaculate condition. Thanks goes to the supporters who made the day possible being: zz Naming Rights Supporter – Wincollect Debtor Software Solutions zz Putting Competition – Creditor Watch zz Hole Supporters: —— Austral —— QBE —— Forbes Dowling Lawyers/Australian Receivables Limited —— Veda —— Stanley Morgan

The prize winners were: zz 1st place went to the team consisting of Steven Maloney, Donna Smith, David Jovanov and Daniel Turk. zz 2nd place went to the Forbes Dowling team. zz The nearest to the pin winners were Brian Hopley, Gary Forest, Greg Young and John Shanahan. zz Ladies long drive was won by Donna Smith and the NAGA award went to Brendan Nixon’s Stanley Morgan team. After the round, competitors enjoyed canapés and drinks in the luxurious clubhouse with terrific camaraderie and networking. I would like to thank the members of my golf co-ordinating committee for their support and I look forward to the National Conference Golf Day in 2017 to be held in Canberra. Good golfing. – Greg Young, AICM Director and Chair of the Golf Day Organising Committee

Adam Mantell, Nathan Shaw, Brendan Nixon and Derrick Cashi.

Charles Tims, Jeff Hurst and Tim Courtright hope their divots are smaller than Lou Caldararo’s.

Players getting ready for tee off. Craig McCarroll, Carla Seirlis, Gary Forrest and Andrew Castledine.

Neil Smith, Brian Hopley, John Shannahan, Greg Young – the second placed team.

The Winners! Donna Smith, David Jovanov, Steve Maloney and Steve Greig, (representing the Naming Rights Supporter Wincollect) and Daniel Turk. December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

New South Wales

National YCP winner Fiyona Kidenya with her team.

Luis Ormazabal of BBW Lawyers, Alex Gilzean of Bing Technologies and NSW Councillor Peter Morgan of Byron Thomas Recruitment.

Keryn Speck, Carl Cavenagh and Debbie Hannaford of Vertas Recruitment.

John Fairgray, Mark Van der Hout and Robert Passas of BBW Lawyers.

President’s Report And the winner is......NSW..... A massive congratulations to Fiyona Kidenya from News Limited for taking out the 2016 National YCP, a fantastic achievement to a very deserving winner. Fiyona tells me she is still on cloud nine after winning. It was great seeing everybody at this year’s conference, great speakers at the sessions, the exhibitors once again out did themselves and wow.... what a President’s dinner. I look forward to seeing everyone at next year’s conference. We’ve had two very successful events since the conference being our barefoot bowls night with over 110 people in attendance. Our end of year Pinnacle Awards sold out with over 140 attending. This followed a Master Class with top-notch speakers. That is it for 2016, watch this space for our 2017 Events calendar which will be on the website by the end of year. I take this opportunity for a few thank youse for the year. To our National Partners: zz Austral, zz Dun and Bradstreet, and zz Veda Our Divisional Partners: zz AMPAC, zz Results Legal, 42

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

zz NCML, zz On Guard and zz Ranstad Thank you for the ongoing support and it has been great working with you all. To Nick, Amanda and the rest of the team at National Office, you have been amazing and we appreciate all of your assistance and guidance with everything we do. To my amazing council – your continued hard work, support, time etc has been first class. The time and effort you all put into making the institute a better place to be involved with is fantastic. To our members, you have been seen and heard in great numbers for 2016. I love getting around to all of you at our events and speaking to others over the phone and email. The ideas you have for us in putting on appropriate events/ networking nights/professional development etc will help make the institute stronger and continue to be a power player in the credit world. From NSW council thank you Grant for your tenure as National President, the AICM is in such a better place from having you at the helm mate and from a personal point I thank you for all your assistance, wisdom, support and friendship over the time. We’re very pleased that you’ve agreed to continue to sit on the NSW council.

New South Wales

David Hunt, Chris Hayes, Gregg Odlum, Anastasia Statenso, Robyn Whitehouse, Ryan Agar and Alex Gilzean.

Fantastic attendance at the night.

Balveen Saini and Col Magee announce the night’s winners.

Lastly but certainly not least to my family, my wife Roberta and my kids, Elysha and Aaron, thank you for allowing me the time away to continue in my capacity as President of the NSW division. I have a real passion for the Institute and I am really excited of where we are and for the journey ahead. Hope you all have a great Christmas and a safe and enjoyable New Year.

that just applying was a great activity bringing the team together and focusing on what they do well. Jennie has also shared her insights and experience presenting at NSW AICM events and the AICM National Conference. She has held National Credit Manager roles at a number of companies including Electrolux and Baxter Health Care. Congratulations Jennie on your LICM and thank you for your service to the AICM and Credit Industry.

– Col Magee, NSW President

ELEVATION TO LIFE MEMBERSHIP

Jennie Barclay-Smyth Grant Morris, as his final duty as National President, recently presented Jennie Barclay-Smyth with Life Membership of the AICM. Jennie has been an AICM member since 14th November 1995 and gained her CCE on 22nd September 2004. During this time she served on the NSW council and various committees for many, many years. Her passion for inspiring teams to succeed led to her creating and launching the Credit Team of the Year competition and award, this award quickly took off and is now one of the AICM’s most prestigious awards. Every team that has entered the credit team has commented

Barefoot Bowls On 17 November 2016, 110 brave credit professionals, both young and old, put their bowling skills to the test at the beautiful Neutral Bay Club (NBC). With the generous support of Elite Collection Services and December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

NSW Councillor Malcom Poslinsky of Brilliant Credit Management thanks Co event sponsor Adam Lysle of Veritas Consulting.

AROUND THE STATES

New South Wales

Co event sponsor Chris Hayes of Elite Collections being thanked by Luis Ormazabal of BBW Lawyers.

Andrew tries his hand at a selfie with Roer Jimenez, Nuala Cummins, Andrew Le Marchant, Malcolm Poslinsky and Theodora Tourlas.

The Australian Institute of Credit Management welcomes our Partners for 2016. National Partners

Divisional Partners

Waiting for the winners announcement.

Veritas Advisory the event, and the competition, was well underway. The teams were fierce, and under the guidance of NBC’s volunteers we learnt the nuances of bowling, and the do’s and do nots. They say ‘a picture is worth a thousand words’ and that is definitely the case for NSW’s end of year Youth Networking Night. AICM’s paparazzi was working hard and snapped some fabulous moments throughout the night. We were astounded to witness the level of networking, interaction and fun which was experienced by all. The green was the attendees’ oyster and they certainly made the most of the networking opportunities available to them. NBC catered a fantastic barbeque which kept the bowlers sustained before the second round of competition began. In the end, the winners being BBW Lawyers and Ecolab, took out the top prize and enjoyed an array of prizes donated by AICM’s corporate members. A big thank you to Elite Collection Services and Veritas Advisory for supporting the event, the NSW State sponsors for their continual support and NSW Council for their continual engagement in helping to make each event as successful as the last. – Balveen Saini, NSW Vice President 44

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

Professional Partner

Official Division Supporting Sponsors

Our National, Divisional and Professional Partners support and work with the AICM to promote the Institute’s activities, represent the Credit Industry and develop the careers of all Credit Professionals. As these organisations support your Institute and your Industry please consider them when you require assistance.

Queensland

Credit Supervisor of the year – Cherese Aitken with Nick Pilavidis.

Felicity Ford, Bruce Patane, Glen McKay and Francis Yoo.

Pinnacle Awards Finalists.

AROUND THE STATES

Credit Manager of the year – Decia Guttormsen with Roger Masamvu.

President’s Report As this is the last publication for the year, it is always a good idea to reflect on the year that was. My mind quickly rushes to a lot of global and local events that have taken place. We were not short of drama! All of which points to a very interesting 2017. The UK’s new leader is pushing ahead with Brexit, the US president elect is hinting at radical changes to stimulate domestic markets, and our PM a few months back in the hot seat is trying to work out what a post mining Australia looks like. It looks like there will be a lot of structural changes as countries look inward for growth. What this will result in, no one knows, but it will have an effect on us all. (Thankfully to a lesser effect in Australia!) One thing that I do know (as I was told at my first YCP interview) is there will always be a need for credit professionals as we play a role in maintaining the buyer seller relationship. We help maximise cash flow while managing risks as laws and the economy evolves. And stepping away from the bigger picture, QLD has seen

Jasmine Bennett and Lucinda Bell. December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

Queensland

Dale Hannan and Nick Pilavidis.

Samantha Taylor, Nicole Young, Jenny Ung and Jasmine Bennett.

Queensland guests.

Ruthven Underhill and Nick Pilavidis.

its fair share of changes as our composition has changed with Brian Kay, Melinda Grob and Michael McDowell all see out their time on council to the AGM in July. Thank you all for your contribution, and all the best for the future. I would also like to announce that new councillors are Decia Guttormsen, Lucinda Bell and Nathan Wilkinson. They are all very excited to be on council and certainly have a lot of energy required to keep the momentum going as we aim to increase engagement with members. And to the rest of council, thank you for another wonderful year! It is always a pleasure working with you! In the events space, QLD has seen a very well attended conference with over 460 people converging on SeaWorld Resort. This was a record for QLD and just shy of the record NSW set last year. At the time of writing our first Pinnacle awards are on track and look forward to a very exciting night! A big thank you to all our sponsors and participants for helping

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

Queensland AROUND THE STATES

Stoddart credit team – Maria Teodosio, Maria Schandl, Gemma Poore, Kirsty Gray and Erin Stewart.

Senior Credit Officer of the year – Lisa Mitchell with Roger Masamvu.

The Australian Institute of Credit Management welcomes our Partners for 2016. National Partners

Divisional Partners Legal representative of the year – Bruce Patane with Nick Pilavidis.

to get this going! We are also moving forward with a CCE exam in December where we hope to get some feedback on the new exam format we will be rolling out next year. To those looking to sit the exam in 2017, I hope you will appreciate the new option. Next year also is shaping up to be an even better year in the way of events. Look out for our calendar on the website, our Facebook page and regular LinkedIn updates for more info and lock in your dates! I would also like to recognise the support in 2016 from our Partners, Veda, Dun & Bradstreet, Austral Mercantile, Vincent’s, Results Legal and Randstad have shown this year. Your commitment to the AICM and credit is much appreciated. And with that, happy holidays all! Look forward to catching up at one of our events next year!

Official Division Supporting Sponsors

Our National and Divisional Partners support and work with the AICM to promote the Institute’s activities, represent the Credit Industry and develop the careers of all Credit Professionals. As these organisations support your Institute and your Industry please consider them when you require assistance.

– Roger Masamvu, President

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

South Australia

Gail Crowder, State President with James Neate, National President and Lord Major Martin Haese.

Kevin Hollister of Kemps Credit Solutions and Candice Kerwin of Veda.

President’s Report Well what a fantastic and busy time we’ve had in SA since my last magazine report! Our Mock Court with ‘real’ barristers and judge was something not to be missed! It was evident that a great deal of time and effort went into this event. I know that I speak on behalf of all the attendees that the participants gave all their knowledge and expertise over and above their call of duty, continuing to answer questions at the conclusion of the event. It felt real, it looked real and we now know and respect their roles, more than ever. On 27 October we were honoured to have the Lord Mayor of Adelaide, Mr Martin Haese talk at our breakfast at the Next Gen Memorial Drive. A beautiful scenic venue overlooking the picturesque Convention Centre, Festival Theatre and River Torrens, with fabulous food and a strong turnout of guests. Martin gave us an honest and frank speech focusing on the profitability for our city and state. Everyone walked away feeling positive for the future in SA! On 24 November we held a Mock Creditors meeting at the offices of Jones Harley Toole. Another amazing venue overlooking Adelaide and the surrounding suburbs. The weather turned on a beautiful bright morning which made it difficult to not take in the ambiance of the venue! These events are always very informative and I know many of the attendees gained a great deal of knowledge. The questions were flowing and we came away with more knowledge of how these meetings are run. Our final event of the year is the end of year catch up at Champagne Lounge of the Stag Hotel. This has been well chosen by the Functions committee! The perfect place to have a catch up with colleagues before the summer break and it will be lovely to see everyone. I trust our members and associates keep informing the committee with their feedback and ideas for 2017 and have gained knowledge and enjoyment from the events during 2016. Thank you to our trusty partnerships that support SA. We appreciate your attendance and input throughout the year. Lastly, a big thank you to our fabulous committee. We are a team, you work hard throughout the year and it is very much appreciated. In closing, I would like to wish everyone reading this article a “Very Safe and Happy Festive Season” and we look forward to seeing you in 2017.

– Gail Crowder SA President

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

National Credit Insurance (Brokers) table.

Breakfast Function with the Lord Mayor of Adelaide The South Australian division held its final Breakfast Network function for 2016 on October 27 at the Next Gen Memorial Drive Function Centre which is located by the picturesque River Torrens and Adelaide Oval complex. It was a privilege to have, as our guest speaker, The Right Honourable Lord Mayor of Adelaide, Martin Haese. Martin has been the Lord Mayor since November 2014 and is a proud South Australian. Previously Martin had helped form the Rundle Mall Management Authority and The Central Market Authority. Being a city resident, business owner and educator, Martin is committed to serving the City of Adelaide’s residential, commercial and visitor communities. This came across very clearly in his passionate and enthusiastic presentation. He has great vision for the city of Adelaide and immense knowledge of council matters. Martin spoke about his busy civic life which included 437 events in 2015. He and his wife have only managed to have a sit down dinner, at their home, twice since being elected! His time is constantly taken up with dinners and breakfast meetings, public appearances, breakfast radio and guest speaker roles. Martin pointed out that you need to be energetic to fulfil this role! Martin advised Council’s 2016-2020 strategic plan based on “smart, liveable, clean and green”, of which he is the main driver. Attendees were enthralled with Martin’s presentation which we believe to be one of the best given to the members of the

South Australia

Matthew Ormsby, Josh Richards, Des Munro, and Alice Carter.

Institute in South Australia. Everyone enjoyed the serenity of the venue, its central location and the quality and service offered by the Next Gen. We look forward to seeing you all again at our next event which is in the planning stages. Details to be released shortly.

provide valuable training and education. Our sincere thanks must go to His Honour Judge Dart, our two Barristers and witnesses. As a result of their work and willingness to engage in the process, at times in a light hearted way, the audience came away with greater understanding of the formalities of Court processes and lessons about preference actions.

– Trevor Goodwin and Gail Crowder, Functions

– James Neate, MICM CCE

Mock Preference Trial In late September the SA Division were treated to a mock trial of preference action conducted in the Supreme Court. The Division has previously run a series of mock Court hearings, focused on Minor Civil jurisdictions to assist Credit Managers who may need to prepare for and appear in Court. This action however, before His Honour Judge Dart of the Supreme Court, involved all the formality of Supreme Court proceedings including two Barristers, wigs and gowns, and expert evidence. A strong number of attendees appreciated the opportunity to see inside the Supreme Court Ceremonial Court room as our two volunteer Barristers Mr Scott Evans of Edmund Barton Chambers and Mr Mark Douglas of Murray Chambers did battle. Mr Nick Cooper, of Worrells Solvency and Forensic Accountants, played the role of Liquidator speaking to a comprehensive expert insolvency report prepared in respect of the preference claim. Thanks must also go to Jeff George of NCI who played the role of Credit Manager, valiantly defending his knowledge of the insolvency of the debtor Company prior to its liquidation. All attending had a full set of pleadings and a copy of the expert’s report to follow the formalities of the trial. Opening addresses, examination in chief, tendering of documents, cross-examination, final addresses and even an ex-tempore (“on the spot”) Judgment delivered by His Honour, rounded out the event which managed to step through a full trial in merely two hours! Nevertheless the true tone of a Supreme Court action and the technical and statutory issues in play, were all covered so that all had a proper sense of the realities of the process. In traditional AICM fashion, we adjourned to the Treasury for refreshments and a vigorous post-mortem. All agreed it was a great insight and SA Council would strongly recommend such an event to any Division looking for an additional calendar event that will attract attendees and

The Australian Institute of Credit Management welcomes our Partners for 2016. National Partners

Divisional Partners

Official Division Supporting Sponsors

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

Worrells team – Montgomery Wolf, Scott McGrice and Matthew Paulsen.

AROUND THE STATES

Victoria/Tasmania

Paul Cooney (Centre) presented with his Lifetime Member Institute Credit Management. From left to right Charles Tims (Tuftmaster), Sia Patouras (ReConnect Finance), Jeff Hurst (Trade Credit Bureaux and National Director Vic/Tas), Lou Caldararo (Spicers and Vic/Tas President).

Nominees and Winner Credit Manager of the Year – David Condello (Australia Post), Mary Petreski (Baxters Foods), Winner Melissa Mann (Visy Industries), Patrick Barry (Goodyear).

Nominees and Winner Credit Supervisor of the Year – Michelle Saavedra (Goodyear & Dunlop Tyres), Abhijeet Waghmode on behalf of Gavin McGuire (recoveriescorp), Winner Bart Vab Reiel (Dulux), President Lou Caldararo.

Nominees and Winner Senior Credit Officer of the Year – Frank Fisher (Australia Post), Christina Ferreira (REA Group), Winner Amaran Navaratnam (recoveriescorp), Seema Saini (Transurban).

President’s Report From this year’s National Conference held at the Gold Coast to the Vic/Tas network events it’s pleasing to see so many new faces attending the events in general. The success of these events are the people, it’s fantastic to see the high level of participation is still there. We have managed to arrange and deliver some great sessions during the year and I would like to thank all our guest speakers who have kindly donate their time and part with their knowledge to deliver very informative and present-day topics. We have also had a couple of network sessions, in Tasmania, in the late stages of this year with great success. A calendar of events has also been completed for both the North and South part of Tasmania. Not to forget regional Victoria, there will be events spread across the state as well, stay tuned for the calendar of events for regional Victoria some great session and topic have been chosen. Congratulations to Libby Simpson, National Credit Manager at New Balance Australia becoming the National CCE Dux for 2016, great effort and well done! National Credit Insurance (NCI) recognise the value and importance of this award and have for many years presented the Dux with a bottle of Penfold Grange. The CCE qualification raises the level of awareness of the credit profession amongst colleagues and the general 50

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

business community. The Vic/Tas AICM Christmas Party and Pinnacle awards night was held on 1 December, good turnout to see all the great nominations be awarded their certificates and congratulations to all the worthy winners on the evening. zz Credit Manager of the Year – Melissa Mann – Visy Industries zz Credit Supervisor of the Year – Bart Van Riel – Dulux Group zz Senior Credit Officer of the Year – Amaran Navaratnam – recoveriescorp zz Legal Representative of the Year – Frank Gambera – McMahon Fearnley Solicitors zz External Collections of the Year – Brendan Lloyd – Austral Mercantile zz Recruitment Consultant of the Year – Tiarne Bennett – Sharp & Carter zz Consultant of the Year – Debbie Leo – Veda zz The High Five! Award – REA Credit and Collections Team To the National partners, Veda, Dun & Bradstreet and Austral and the State partners, AMPAC, NCML and Sharp and Carter, thank you for support and contribution over the last 12 months and looking forward to a bigger and better year in 2017. Congratulations to Paul Cooney on being awarded Life Membership of the AICM, Paul has been a long-term member of the Institute, a stalwart of the credit industry and a worthy recipient of this award.

Victoria/Tasmania

Congratulations to Libby Simpson (Pacific Credit Manager, New Balance) – National Dux CCE 2016.

Nominees and Winner External Collections Agent of the Year, Donna Smith (Reliance Recoveries), Dale Hanna (National Collection Services), Winner Brendan Lloyd (Austral Mercantile).

Nominees and Winner Recruitment Consultant of the Year, Winner Tiarne Bennett (Sharp & Carter), Artemis Vrionis (Aston Carter).

Many thanks to all the councillors for their support and assistance over the last 12 months and we are looking forward to an exciting and engaging 2017. Wishing everyone a happy and enjoyable festive season and no doubt a well deserved break over the holiday period. – Lou Caldararo, Victorian President

Paul Cooney Achieves Lifetime Membership with AICM We wish to congratulate Paul Cooney on achieving a Lifetime Membership of the AICM. On 27 September 2016 Paul was presented with his award by current and former members of the VIC/TAS Committee as recognition for his outstanding commitment and contribution to the industry and to the AICM. Paul has been involved in collection and receivables for over 35 years, working at some of the largest collection companies in Australia and the UK. He started at College Mercantile wherein he spent his last 5 years as Group General Manager until it was sold in 1986. From there he moved to WJ Lawrence & Co in 1987, joining the business as founding Managing Director. Under Paul’s direction this organization grew to become one of the largest collection agencies now known as Receivables Management (Vic) Pty Ltd. In 2005 Paul established Forbes Dowling Lawyers, which provides special litigation and insolvency legal service

AROUND THE STATES

Nominees and Winner Legal Representative of the Year, Winner Frank Gambera (McMahon Fearnley), Bruce Patane (Patane Lawyers), Ali Dogan (MacPherson Kelly), Lou Caldararo (President).

Nominees and Winner Consultant of the Year, Winner Debbie Leo (Veda Equifax), Stephen Maloney (AMPAC), Shaun Odgers (Creditor Watch).

to many organisations on the east coast of Australia. He was also involved in the establishment of the now well-known ARL group which he continued with until the middle of 2015 when he retired. During his time in the industry Paul has been a stalwart supporter of the AICM, attending or arranging for his staff and clients to attend a large proportion of our functions. He was always willing to provide assistance and help whenever called upon, and our VIC/TAS Division owes a great debt of gratitude to Paul for over 35 plus years’ service to the industry. We are most grateful to Paul for his support and contribution to the Institute and now also to ARL for carrying on his mantel. Well done Paul!

Half Day Seminar 22 September 2016 – PPS, Insolvency and Debt Recovery Mark Wenn and Shannon Jenkins delivered a quality half day seminar on PPS, Insolvency and Debt Recovery. The seminar was preceded by a light lunch, and members and guests were well represented at the event held at Mills Oakley Offices in Collins Street, Melbourne CBD. Mark and Shannon provided an in depth presentation covering a number of very relevant areas that effect Credit Managers every day, including PPS, Insolvency Law, and Debt Recovery Strategies, giving all who attended a great insight into the works of our legal system and how it impacts the role of the Credit Manager. December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

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Victoria/Tasmania

Winner The High Five! Award – REA Group Credit & Collections Team – Michael O’Keefe, Cristiana Ferreira, Amit Jaiswal, Clara Malizia, Hollie Kane, Lorita Danielson, Tiffany Milne and Sherif Hussein.

Members and Guests Deep in conversation at the Vic/Tas Pinnacle Awards Dinner.

Members and Guests at PPS, Insolvency & Debt Recovery Half Day Seminar, September 2016. Shannon Jenkins and Mark Wenn (Mills Oakley) present to members and guests at Vic/Tas PPS, Insolvency & Debt Recovery Half Day Seminar, September 2016.

November Network Breakfast – Debtor Engagement and the Role of Technology Technology is changing the face of Credit Management and Stephen Maloney, Director AMPAC Debt Recovery shared his unique point of view and delivered an enjoyable and informative presentation to members and guests on how technology is changing the industry, how collection agencies are becoming innovative in their approach to debt recovery and how technology helps then become smarter in how they collect debt. This event was held at the Parkview Hotel, St Kilda Road, Melbourne. Members and guests expressed the value and their enjoyment of this event.

Tasmania Network Event – Current Trends in Credit, Fraud and E-Crime A solid turnout of members and guests at the Derwent Sailing Squadron, Sandy Bay, were treated to excellent presentations on Fraud and E-Crime by Detective Sergeant Gen Hickman of the Tasmanian Police Force, and Current Trends in Credit by Shaun Odger from Creditor Watch. The content was relevant and speakers engaging on what turned out to be a very successful event. 52

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

Vic/Tas 2016 Pinnacle Awards Dinner Approximately 90 members and guests attended the 2016 annual Pinnacle Awards for the Vic/Tas Division, held at the Marriott Hotel, Exhibition Street. A good time was enjoyed by all with sustenance provided and as members and guests eagerly awaiting the announcement of the winners of the 2016 Pinnacle Awards. Importantly we would like to thank our National Partners Austral, Dun & Bradstreet, and Veda, our Divisional Partners AMAPC Debt Recovery, NCML, Sharp & Carter and Austral Mercantile for sponsoring the Credit Manager of the Year Award and Debt Sale Brokers Australia for sponsoring the Consultant of the Year Award, without the continued patronage and support of our sponsors we would not be able to hold important events such as these and we wish to extend our most gracious thanks to all our national, divisional and event sponsors. Our evening was hosted by Lou Caldararo, Vic/Tas president. Nominations for the various categories were as follows, with the Winner listed first: Credit Manager of the Year zz Melissa Mann – Visy Industries – Winner zz David Condello – Australia Post zz Louie Tzakopoulos – Wurth zz Mary Petreski – Baxter Foods zz Patrick Barry – Goodyear and Dunlop Tyres zz Suzanne Lucas – Ruralco (not attending)

Victoria/Tasmania

Detective Sergeant Gen Hickman presents on Fraud and E-Crime at the Tasmania Network Night, November 2016.

Credit Supervisor of the Year zz Bart Van Riel – Dulux Group – Winner zz Anthony Petraitis – Wurth zz Gavin Mcguire – recoveriescorp zz Michelle Saavedra – Goodyear & Dunlop Tyres

to thank the event organisers for their hard work in organising such an event. A big thank all the members for their support in attending events during the 2016 year and to the Committee Members and Event presenters who continue to volunteer their time to bring valuable education, interesting social events and support to the members of the AICM Vic/Tas Division. We hope that 2017 will be a successful year for all.

Suggestion Box:

Senior Credit Officer of the Year zz Amaran Navaratnam – recoveriescorp – Winner zz Cristina Ferreira – REA Group zz Frank Fisher – Australia Post zz Seema Saini – Transurban

As a Credit Professional if there is a topic that we have not recently covered that you would like covered or a social event you would like us to try please email dsmith@relrec.com.au and we will raise it at the next committee meeting for consideration.

Legal Representative of the Year zz Frank Gambera – McMahon Fearnley Solicitors – Winner zz Ali Dogan – Macpherson Kelley zz Bruce Patane – Patane Lawyers zz Joanne Mannah – Force Legal (not attending)

The Australian Institute of Credit Management welcomes our Partners for 2016. National Partners

External Collections of the Year zz Brendan Lloyd – Austral Mercantile – Winner zz Dale Hannan – National Collection Services zz Donna Smith – Reliance Recoveries Pty Ltd Divisional Partners

Recruitment Consultant of the Year zz Tiarne Bennett – Sharp & Carter – Winner zz Artemis Vrionis – Aston Carter Consultant of the Year zz Debbie Leo – Veda (Equifax) – Winner zz Shaun Odgers – CreditorWatch zz Stephen Moloney – AMPAC

Professional Partners

The High Five! Award zz REA Credit and Collections Team – Winner zz Amaran Navaratnam – recoveriescorp zz Australia Post National Leal Recovery Team zz Dale Hannan – National Collection Services

Official Division Supporting Sponsors

Well done to all those nominated, it is a great honour to be recognised by the industry, and of course a huge congratulations to all our winners. Many members expressed their appreciation and enjoyment of the evening, and complimented the AICM on the event. The committee would like to take this opportunity

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

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Shaun Odger (Creditor Watch) presents on current trends in credit Tasmania Network Night, November 2016.

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Western Australia/Northern Territory President’s Report

you, our Members. If there is something missing on our events

Onwards and upwards

all here to help.

In the October conference edition I reviewed our highly

calendar you would like to see, please get in touch as we are While we wait for Santa to help with the Christmas cheer, I take this opportunity to thank the WA Council, our Partners and

successful 2016. This edition looks at the year ahead and I want to invite you all to join us for what is looking to be another blockbuster

the National Office for their continued support of the job we do here in the WA Credit Industry. Seasons greetings to all.

here in WA.

– Lisa Marr MICM, WA State President

In November, we held a great meeting with our National and State Partners to discuss the year in review and make plans for 2017. I expressed to our Partners the importance of sharing knowledge and keeping members informed with the latest trends in the financial sector. I look forward to working with each of them to deliver something exceptional at our Breakfast Clubs next year. Socially in 2017 we’ll look to have fun and engage with a wider audience. The prospect of out first Golf Day is gaining momentum and we can’t wait to have you all join us on the links. Women in Credit returns and our YCP Gala Dinner will impress yet again. We cannot do any of these things without the support of

The Australian Institute of Credit Management welcomes our Partners for 2016. National Partners

WINC Review WINC 2016 was a massive success with over 80 people settled into the Matilda Bay Restaurant on the 16th of September listening to three very successful women from very different backgrounds and careers. The whole room were on the edge of their seats hearing career stories and perspectives from Linda Murray from Athena Coaching and a 2016 Nominee for the Telstra Business Women’s Awards, Lisa Stedman Chief Operational Officer of Pioneer Credit and Cobie Rudd the Deputy Vice-Chancellor and Vice-President at Edith Cowan University. Debbie Leo from Veda did an exemplary job of facilitating the event and asked questions of the panellists that gave the audience an insight into how these women became successful in their own right and advice they had for young women starting out in their careers. Feedback on the day from all attendees was that it was a huge success. Our raffle was also a great success raising $600 to be donated to Beyond Blue. Thank you to our event sponsors: zz NCI, and

Divisional Partners

zz Results Legal A very special thank you to our Premium Sponsor, Veda. I am confident that this is going to be a permanent fixture on the WA AICM Calendar so please keep your eye out for the next WINC event.

YCP The journey to become the YCP winner for WA and then to represent WA at the National awards in 2016 has been an Official Division Supporting Sponsors

amazing one. The process to be endorsed by my manager and the national credit manager to apply for the YCP 2016 was enjoyable and surprisingly quite simple. Having my direct manager recount positive and business changing ideas or

processes that I have been at the heart of and all that I have achieved, was a great reflective process. It’s not every day that you sit back and reflect on almost 4 years and the impact that you have had. It was humbling. Once I had been endorsed, I was interviewed at the D&B

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

Western Australia/Northern Territory questions that related to all aspects of the credit industry and where I felt the industry was heading in the coming years. The questions gave me the ability to share my knowledge base but also to provide any personal opinions or thoughts I might have had. The YCP dinner at Burswood was a great night. The two other WA finalists and I had a chance to network within the industry, but also to get our faces out there. The YCP is a prestigious award and it was great to be supported by all who attended. Winning the WA title was surreal. I have been given a fantastic opportunity

Mark Russell Managing Director – Corporate, Insurance & Professional Services Dun & Bradstreet interviewing Sarah on stage.

to join the WA AICM council and hold the YCP portfolio until next year’s winner is announced. I also get to partake in all of the AICM events on offer and attend WA Council meetings each month. The opportunity to make a difference and to have an input into the future of the credit community is inspiring. Making my way over to the Gold Coast for the National Conference was mind blowing. The people that I was able to meet, the speakers I was able to listen to and finally the industry leading organisations that I was able to see has opened more doors than I had expected. I spent most of my time with the other state YCP finalists learning about their journey in the credit industry and what they had to offer.

Simon Bligh CEO Dun & Bradstreet Australia and New Zealand presenting Sarah Reed with her National Finalist certificate.

The YCP dinner at Movie World was a rollercoaster of excitement and nerves. Receiving the amazing feedback that I got from the AICM and D&B has encouraged me to excel in my career and to remain involved in the credit community. The people that I have met along the way through the interview process leading into the awards dinner has been a great networking experience. A huge thankyou to the WA AICM and D&B for all of the support and opportunities. – Sarah Reed, WA YCP Finalist 2016

Sarah with the other state finalists at the President’s dinner.

December 2016 • CREDIT MANAGEMENT IN AUSTRALIA

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office by 3 AICM members. I was asked

AROUND THE STATES

New Members The Institute welcomes the following credit professionals who were recently admitted to membership in September, October and November 2016.

New South Wales Rebecca Bourne Leah Tucker Gillian Seddon Anthony Skoulos Susan Pieris Willard Desmond Koelmeyer Juanita Weston Andrew Summers Nathalia Tan Geri Damaschino Paula Carroll Lindsey Webster Kim Meredith Oliver Bowers Davis Joanne Froio Stephen Allan Jackson McDonald Zareen Prasad Maree Kelly Editha Marcelo Carol Wakeling Lourdecita Gevero Asheem Khan Patricia Talsma Gail Willcocks Shengyin Ye Benjamin Mendonca Thomas Hatzis Christopher Boghossian Stefania Leszczynski Bill Mali Bina Kumar Praveen Lal Paul Smith Chris Ryan Karen Ashby-Ryan Venissa Freesir Monory Dith Ana Taufa Manish Kumar Ruth Williams Grishma Patel

Aurecon Group Austral Mercantile Collections Pty Ltd Bluescope Steel Limited Bunzl Food Processor Supplies Bunzl Food Processor Supplies CML Group CML Group CML Group CML Group CML Group CML Group CML Group CQMS RAZER PTY LTD Dimension Data Australia Pty Ltd Forestry Corporation GSA Insurance Brokers Pty Ltd GSA Insurance Brokers Pty Ltd GSA Insurance Brokers Pty Ltd IAG IAG Imperial Tobacco Imperial Tobacco Jaybro Jaybro Multi Channel Network Pty Ltd Multi Channel Network Pty Ltd Multi Channel Network Pty Ltd Optus Optus Optus Optus Optus Optus PPSR Plus Pty Ltd PPSR Plus Pty Ltd PPSR Plus Pty Ltd Shield Mercantile Pty Ltd Shield Mercantile Pty Ltd Shield Mercantile Pty Ltd Veolia Energy Technical Services Veolia Environmental Services Veolia Environmental Services

Queensland Neville Matthews Doug Oweczkin Meagan Cougle Phillip Heise Robert Ward Alexandra Sellars Cheryl Nixon Luisa Hyland Renee Dobson Zara Mends Eugene du Plessis Audrey Kent Kasandra John Judy Shailer Laura Jenkinson

Acorn Collection Services Pty Ltd Cashflow Finance Australia Pty Ltd Cashflow Finance Australia Pty Ltd Cleanaway Detective Desk DRS Envirostraw Pty Ltd Hygrade Water Australia Limited Partnership National Credit Insurance (Brokers) Pty Ltd National Credit Insurance (Brokers) Pty Ltd Puma Energy Australia Fuels Pty Ltd Puma Energy Australia Fuels Pty Ltd Puma Energy Australia Fuels Pty Ltd Puma Energy Australia Fuels Pty Ltd Veolia Environmental Services

South Australia Mia deLaine Sandy Christpoulos 56

Bluescope Distribution Pty Ltd Inenco Group

CREDIT MANAGEMENT IN AUSTRALIA • December 2016

Payal Anand Annaleisa Briggs Nicholas Graham Joanne Amber

Insurance Australia Group (IAG) Lynch Meyer Lawyers Lynch Meyer Lawyers National Credit Insurance (Brokers) Pty Ltd

Victoria/Tasmania Leigh Garth Narelle Edwards Maisie Jones Susan Cahill Hiral Shah Lachlan Tubman Michelle Crawford Aaron Laws Marc Visser Payal Thakar Joan Withers Lisa Wood Annette Schwab Anthony Livanios David Kullu Andrew McKenzie Elizabeth Collyer Debbie Koutros Kate Boswell Jessica Goodchild Matthew Butts Michelle Hall Sarah Kumetaitis Lynsey Foster Lorna Christison Ange Del Pozzo Kate Leatch Neil Gregoor Simon Keleher Lisa Wilson Karla Ardeljan Justin Coates Dean Fraser Eddie Baskan Rohit Dhingra Shontai Wood Genevieve McLean Tanya Rodrigues Erin Pottenger Mat Longin Imogen Seyfert Tessa Greenslade Sarah Wilson

Bennetts Petroleum Supplies Pty Ltd Roberts Ltd Austral Mercantile Collections Pty Ltd Austral Mercantile Collections Pty Ltd Austral Mercantile Collections Pty Ltd Austral Mercantile Collections Pty Ltd Austral Mercantile Collections Pty Ltd Austral Mercantile Collections Pty Ltd Austral Mercantile Collections Pty Ltd Austral Mercantile Collections Pty Ltd Bidvest Foodservice Bluescope Distribution Pty Ltd Bluescope Steel Pty Ltd BP Australia Pty Ltd BP Australia Pty Ltd BP Australia Pty Ltd Bunzl Australia Bunzl Outsourcing Services Bunzl Outsourcing Services Bunzl Outsourcing Services Bunzl Outsourcing Services Bunzl Outsourcing Services Bunzl Outsourcing Services Bunzl Outsourcing Services Ltd Department of Justice and Regulation Department of Justice and Regulation Department of Justice and Regulation Department of Justice and Regulation Department of Justice and Regulation Dindas Australia Pty Ltd Freshmax Australia Pty Ltd La Trobe Financial Optus Optus Optus Optus Optus realestate.com.au Seek Limited Seek Limited Seek Limited Seek Limited Seek Limited

David Clough Narelle Cirillo

Veolia Group Wilson Security

Western Australia Brenda Woodger Jacquie Sayer David Gould Greg Quin Michael Russell

Austral Mercantile Collections Pty Ltd Austral Mercantile Collections Pty Ltd CFC Group HLB Mann Judd (Insolvency WA) Veolia Environmental Services

Overseas Nitin Chaudhry Niteshni Swami Melvin Sharma

Fletcher Building Limited Fletcher Building Limited Goodman Fielder International (Fiji) Ltd

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