Credit Management in Australia - December 2017 by AICM

Volume 25, No 2 December 2017

The Publication for Credit and Financial Professionals

IN AUSTRALIA

Phoenix

READ WHAT THE EXPERTS SAY including ATO and ARITA views

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Volume 25, Number 2 – December 2017

Message from the President

65 NSW Division: Southern Steel team.

History An address at the AICM National President’s Gala Dinner

By James Neate

History of the Certified Credit Executive (CCE) program

By Trevor Goodwin

Human Resources

From the chief of chaos to the custodian of calm in three steps By Petris Lapis

Be the leader people want to follow

66 Qld Division: Golf Day – John Shanahan, Samantha Goddard, Simon Dawson and Greg Young.

By Linda Murray

Economic review Economic insights from AICM National Conference

By Kirk Cheesman

Australia’s small to medium business sector looking beyond the banks to fund growth

By Peter Langham

Credit Management The Australian economy in 2018 – boom or bust?

By Stephen Koukoulas

SA Division: John Antoniadis, Ericson Malvar and Ratibor Mirkovic, all of NCI, receive their certificates from CCE Director Trevor Goodwin.

The Expectation Vacuum By Paul Burgess

Achieving world class results in automating cash allocation By Trevor Middleton

How credit managers can better assess the financial strength of companies without access to their financials

By Stephen McKinney

Phoenix The New Proposed Anti-Phoenixing Laws

Vic/Tas Division: Getting Warmed Up for the Singing Bee.

By Roger Mendleson

Director Identification Numbers By Graeme Beattie and Jonathan Yee

13 Petris Lapis

16 Linda Murray

20 Peter Langham

28 Trevor Middleton

73 WA/NT Division: Nathan Stubing addresses the October breakfast meeting.

It’s not that hard to stop illegal phoenixing

By John Winter ISSN 2207-6549

The sliding scale of phoenix activity

DIRECTORS

By Brett Martin

Australian President – James Neate LICM CCE Australian VP, Finance – Gregg Odlum MICM CCE Professional Development – Rowan McClarty MICM CCE YCPA & CCE – Trevor Goodwin LICM CCE Legal Affairs – Greg Young MICM CCE Member Services – Jeff Hurst LICM CCE

More legislation to fight phoenix activity

CHIEF EXECUTIVE OFFICER

By Frank Gambera

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

By Giles Woodgate and Richard Rowley

Insolvency Insolvency Reform: A summary of the Safe Harbour Law for Directors

AICM Training news AICMQ

Technology in Action By Chris Sanders FCICM

PUBLISHER Nick Pilavidis | Email: nick@aicm.com.au CONTRIBUTING EDITORS

2017 AICM National Conference

EDITOR/ADVERTISING

Overview President’s Dinner Young Credit Professional of the Year Credit Team of the Year Student of the Year CCE Dux & Recertifying CCE’s President’s Trophy

Andrew Le Marchant LICM CCE Phone Direct 02 8317 5052 or Mob 0418 250 504 Email: andrew@aicm.com.au

Around the States

NSW – Balveen Saini MICM Qld – Stacey Woodward MICM SA – Gail Crowder MICM WA – Lisa Marr MICM Vic/Tas – Donna Smith MICM CCE

50 54 56 58 59 60 62

New Members

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Credit Marketplace

New South Wales EDITING and PRODUCTION Anthea Vandertouw | Ferncliff Productions Tel: 0408 290 440 | Email: ferncliff1@bigpond.com

Queensland South Australia Victoria/Tasmania

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, 2017.

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From the President

James Neate LICM CCE National President

017 has been a special year as the Institute celebrated 50 years since its incorporation, recognising 80 years since the formation in NSW of our predecessor. The highlight of our year was the National Conference in Canberra in October. It proved to be a showcase of the best that the national credit industry has to offer in terms of the relevance of topics, quality of speakers and a vibrant exhibitors’ market place. A hearty congratulations to our National Office team for organising such a fantastic event, capped off by a very special celebration Gala Dinner in the Great Hall of Parliament House. Across the States we have celebrated and recognised this anniversary and I hope younger members and people within credit, recognise the opportunities for a vibrant and engaging career in commerce in the credit space. For those who do not work in or understand credit, it is often difficult to explain how broad the role of credit is within different industries and across consumer, public and commercial sectors. It remains true that a person can advance their career in credit by their own initiative and industry relevant qualifications. This year of “reflection” has also highlighted that peer support, collegiality and mentors continue to play a key role in fostering younger members. Those qualities are to be encouraged. This year has also seen a marked increase in the number of formal written submissions prepared by the AICM, amplifying our voice and fulfilling our advocacy role on behalf of members and the Credit Industry. A broad range of submissions on topics as diverse as Amendment to the PPS Lease definitions, Illegal Phoenix activity, Transparency of Tax Debt information (aka ATO defaults), Prompt Payment Times and Practices, Insolvency Reform and Safe Harbour and Ipso Facto amendments to the Corporations Act. The AICMs views on these submissions have been distributed in other newsletters and are

available on our website. While not always “light reading”, it is valuable work, often unrecognised. It is important that members understand the “clout” that the Institute now carries in terms of its standing with government agencies, ATO, ASIC, AFSA, Australian Small Business and Family Enterprise Ombudsman, Treasury and politicians. These are further reasons why, if you are serious about your professional standing, you will follow these developments and alert your work place to our advocacy and contributions to reform. Planning across all Divisions is well underway for next year, including a mix of formal training and qualifications, technical updates and practical skill sessions and other peer networking events. We are still to finalise the Pinnacle Awards in some Divisions but that programme together with Women in Credit, Credit Team of the Year and the Young Credit Professional Award, will remain fixtures in the programmes offered next year. Turn your mind to how you and your team might engage with the Institute in the New Year. For the moment, after a busy year and that inevitable rush towards Christmas, members are no doubt looking forward to a holiday break. Best wishes to all members and thank you for your support of the Institute this year. I want to recognise the Division Presidents and Councillors for their volunteer work. They are the face of the Institute in each State and their contribution is critical to our success. At the Conference Dinner, I specifically thanked all of our National Team based in Sydney for not only their hard work but their true commitment to the AICM as a member organisation. Your efforts are appreciated and enable our programmes. I look forward to seeing your continued engagement with the AICM in 2018. Happy Christmas and a very safe new year to all. Regards,

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

– James Neate LICM CCE National President

AICM History

An address at the AICM National President’s Gala Dinner Parliament House, Canberra – Thursday 12 October 2017 On this very special occasion it is appropriate that we spend a short time looking at the history of the Institute as we recognise and celebrate the success of the Institute in its 50th year since its national incorporation. In reality, it is 80 years ago since our precursor organisation, the Australian Institute of Credit Men, was formed. An occasion such as this is a rare opportunity to recognise that we, the current members of the AICM are simply part of a much larger continuum of the work of the Institute.

James Neate

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

On 1 June 1937 some 80 years ago, a group of likeminded “chaps” as they all were, got together in Hunter Street in Sydney and in accordance with the custom of the day, a very formal meeting was convened. Minutes were taken and we still have those as part of our records archive of our history. A Mr J.H. Hawkins assumed, by popular proclaim it seems, chairmanship of the meeting and a motion was passed that: “…the meeting had been called in conformity, with a general desire amongst Credit Men, that a body be established to (amongst other things) recognise and maintain the professional status of all those engaged in the control of credit…” And so, it was agreed that there should be an Institute and the formal legal steps were taken for the incorporation in New South Wales of the “Institute of Credit Men” on 20 June 1937, “to recognise and maintain the professional status of all those engaged in credit” In looking at that resolution, you can see the clear continuing objectives which are as much our agenda and our programmes today, as they were when our first predecessor organisation was formed. Those simple guiding principles have been the constant theme of the focus of the work of the Institute throughout that 80 year period. Much has changed in that time. The organisation was founded before the second world war, there have been advances in technology that would have been unthinkable, but the simple principle agenda of the Institute has remained consistent and true - to educate and develop credit professionals. And so, the Institute grew across Australia. The Victorian chapter, at first actually a Division of the New South Wales organisation, was formed in 1940 but was disbanded in 1944 when the “Victorian Institute of Credit Men” was formed. That great state rivalry meant the Victorians were not willing to be ruled by NSW!

A Queensland chapter was also formed in 1940 but owing to the 1939 to 1945 second world war, it was effectively suspended in 1942. The South Australian Institute was incorporated in 1948 and subsequently the Queensland chapter was reformed and then followed quickly, the formation of state institutes in Western Australia and Tasmania. New South Wales claimed the credit for taking the initiative in 1962 to organise the first “National Credit Convention” and issued invitations to all States to attend. The States still guarded their independence and as such, the consensus was, that rather than merge the existing Institutes, they would instead form amongst themselves an overriding organisation called the “Commonwealth Association of Institutes of Credit Management” and so another organisation came into being. Matters progressed until another National Conference was held in Melbourne in 1965, at which time it was unanimously resolved that a new National Institute would be formed. It was thought advisable to create a new entity rather than use the existing “Commonwealth Association of Institutes of Credit Management” as this would prevent any feeling that the amalgamation was in reality, a takeover. The history of the Institute is of course the story of its Divisions given that our organisation is a people organisation. It was who we knew in each of our Divisions, that shaped our understanding of what the AICM was and what it offered. Our experience of the Division was our experience of the AICM. As we travel around more to different Divisions, it is clear that the AICM tone and flavour of training and networking events is surprisingly similar irrespective of where the meeting is held. You are always assured of a warm welcome and a cold refreshment. Looking back through old magazines and reports, it has always been clear that the social networking side, the informal opportunities afforded by AICM events, have been at our core. The importance of a network often with a drink in hand, a group of people who you know that you can trust in confidence, that you can call upon, that will answer your questions and give you guidance, will share their experiences, those are the things that come from an old fashion network. In a modern world, we have facebook, people tweet twitters, and these networks can play something of that role, but our challenge is to harness the “multiplier potential” that exists in these modern networks so that we can engender them with the same content and connection to the Institute. Ultimately however, nothing quite beats a good chin wag with friends over a drink and the real business, professional, personal and friendship benefits of those engagements are the nourishment that has maintained so many people through their credit careers.

There is a story for each Division to tell as its own history, of the businesses and the people that came together. It is the members and the volunteers who have supported and driven the Institute through its various phases. This is a common story across all of the Divisions and there are many people who you would call loyal stalwarts. They might have been Registrars of the earlier State based Institutes, Presidents who were in Office over key growth or policy phases or alternatively, long serving and dedicated members, some who never went near a Council portfolio (because they hate meetings!) but who could always be relied upon to show up, muster numbers, and be enthusiastic. Those loyal people lived and promoted the values of the Institute and encouraged others to do so. Many other people have promoted and sustained the Institute more quietly in their own workplaces, promoted the ideals of the Institute in their roles as mentors. Most people here, especially those with longer careers in credit, can identify one or two key mentors across their working lives who have influenced them and to whom they are indebted. That is the ongoing work of the Institute and its members. Over time, each Division has recognised some of those key contributing people by establishing awards in their Honour. In South Australia, we have the Laurie Ellis award, in Queensland the Marion Hintz award, the Bob Burns award, and the Les and Peg Crook award. In Victoria we have the Tony Mammone award for education. While tonight does not allow me to tell too many stories, there are key contributors who must be recognised, especially given the broader role they played at a National level. May I mention for example, Olive Rhodes, a long time South Australian Council member who in 1968 was the first female member to be elected to the Australian Council, Olive Rhodes, was always known forever in South Australia as Dusty Rhodes. She remained as a National Board member for a number of years. Life member Betty Fleming, an inaugural member of the Northern Tasmanian Branch, retired from the National Board after a long period of service in 1998. Her story, told in the National magazine, shows 30 years of holding office in various capacities:- Branch President, Division President, National Director, indeed some of those roles were held at the same time, possibly unconstitutionally! We also recognise tonight, here and present with us, a former National President, Mr Roger Penfound from 1994 and 1995 and also Carol Penfound/Pope who is another of the very few women who rose to serve on National Board as a Director. Together, their contribution in Victoria and Queensland is legendary. I must also mention and acknowledge the role of Glenda Jeffries from Western Australia who, according to our records, is the only other female National Board member to have served.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

AICM History

While there has been a strong history of contribution and leadership from our female members, that is not recognised at the moment by their presence on the current National Board in that our current membership sits slightly weighted in favour of females. While we have currently 3 female Division Presidents, as many Vice Presidents and very strong female representation on all State Councils, there are currently no female National Board members. The Australian Institute of Company Directors has a gender diversity policy where the ASX top 200 have targeted for 30% of their Board members to be female. I can announce tonight that the National Board has as a policy initiative, which will probably need Constitutional change, to create extra National Board positions which can be directly filled via a nomination process so that we can proactively address the gender imbalance on Board. The Women in Credit programme is a more recent initiative recognising the role of women. The Institute is currently stronger than ever. Our membership numbers are equal to those of 10 years ago. We have trading surpluses and now reach our members through our website, e-magazine and webinars which give us extended reach. Our standing as the voice for the credit profession has never been louder in our advocacy role and we are regularly invited to make detailed written submissions about legislative reform in the ever complex legal arena of insolvency, privacy, Australian consumer law, Personal Property Security etc. The Institute continues to recognise excellence in particular, by its Certification of Credit Executives, CCE’s, those people who through their experience and a formal assessment process are recognised as being people, irrespective of their age, who have attained the highest of technical professional skills. The National Board has recently listed as a priority, the need to develop a program to engage more fully with those in the consumer credit space. The distinction between consumer and commercial used to simply be the name on the account but with consumer protection, fair trading, unfair contracts, privacy, ASIC debt collection guidelines and a raft of other legislation, the consumer space is now one of the most regulated areas of any form of commercial enterprise in Australia. That makes it an ideal and natural area for the Institute to bring the wealth of its experience, the courses and qualification materials we already have to hand, to promote those in the consumer market. The Institute’s history has always been one of grappling with change whether it be changes in commercial life, the legal framework or the consequences of ever quickening technology. Younger members will be amazed to understand it was a relatively common experiences in the 70s and into the 80s where large pools of typists and account clerks would work, without the aid of computers

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

or even calculators, often running manual card systems to keep track of accounts and credit records etc. There was a day when marriage was death to a career as “Miss Jones from accounts would be leaving to get married”. That era seems so long ago now and as we know from current presentations at the Conference, the pace of change continues towards the previously unthinkable, an automated credit application! Over the years the Institute’s management structure has changed and we note the key contributions made for example by the inaugural National Executive Director appointed in 1989, Les Wilson. That first National Office started a model which continues today. The State versus centralised management was in the past much of an issue, indeed at times a hot political and even legal matter. Things are different now and the support and capability afforded by a professional, permanent National Office enable Divisions in a way not previously possible. The work of National was continued by long serving CEO Terry Collins appointed in October 2000 who oversaw a key phase of the Institute including the development of AICM Learning Services, a formally licensed and Commonwealth Government regulated Registered Training Organisation since 1998. The core offering of the Certificate and Diploma Courses run through the AICM continues to set the standard for the quality of our educational work and our credibility as the premier trainer for all credit things. It was during this era that Del Cseti made such contribution and was at the centre of so many projects and initiatives. More recently, the Institute has embraced another era of review, change and refocus under the guidance and with the support of our current CEO, Nick Pilavidis. A degree qualified former credit manager and CPA, Nick’s own story is a journey through the AICM. From membership as a credit manager to being the National Young Credit Professional of the Year, to roles on NSW Division Council and National Board as treasurer, to ultimately become our CEO. The only thing he has not done is my job as National President! Nick continues to offer the Board innovation, enthusiasm and energy for new projects and initiatives and so the future of the Institute looks bright and we are ably led. Nick has around him a committed team in our National office who work so hard to continue the delivery of events at Division level and national training, and of course to coordinate the grand highlight of the national credit year, our annual Conference. Our thanks go to them for their continued hard work and commitment to making the AICM the best. We recognise and thank Andrew Le Marchant, Debby Manners, Toni Sawyer, Amanda Borland, Wendy Liu and Karen Croft for their work in coordinating such a great Conference. We also recognise their contribution as loyal and enthusiastic supporters of the AICM. In conclusion; In July 1966 in the first edition of “The Australian

AICM CEO Nick Pilavidis and Australian President James Neate. Credit Manager” the first National magazine, the national inaugural President, Lionel Scott from NSW, wrote: “It is my privilege to write the first article “from the President’s desk” for, the journal of the newly a constituted national organisation. Whatever mixed feelings I may have had when writing the last article (about the ending of the old organisation), the mixture on this occasion is one of pleasure and optimism that… in the foreseeable future, our Institute will proceed from strength to strength. He went on to say “…let me look ahead. I am confident, to the day when the Institute, our Institute, assumes its rightful status as a force in the business life of Australia. How rapidly, and how far, we progress will depend on each of us, on our ethics, our ability, our energy, our enthusiasm.” Prophetic words from the first National President of the AICM, Lionel Scott. While Lionel Scott is probably completely unknown to everyone here, it is entirely appropriate that we hear his words tonight. He could not have imagined the dynamics and vibrancy of doing business today and the complex role of the modern credit professional. To the founding folk of 1937, this modern, computer, internet, interconnected, instantaneous world would be alien. In 1966 at the formation of the organisation, there was a rally call to build on what had been before, to stay true to the values of the Institute and to contribute for the greater good. At its core, that is what the Institute is about. A volunteer organisation whose aim is to support, foster,

Tonight we all have great pride in recognising our long history and that so much good work has been done by so many. In reality, cumulatively, tens of thousands of members over the years. We recognise them, thank them for their efforts and pledge our ongoing commitment to the ideals of the Institute. nurture, encourage and educate. In a busy and complex world where life is at break neck speed, the true values and purpose of the Institute ought not be forgotten. Tonight we recognise all those people who have come before us and who are with us continuing the work of the Institute. We recognise the members, who have demonstrated their commitment to setting the professional standards in excellence in the discharge of their duties, to a professional and ethical approach in dealing with all people in our commercial lives. There is much for the Institute to be proud of and as first National President, Lionel Scott, called upon the membership in 1966, we the current custodians call upon you all to engage with the Institute, to reach out to mentor and support peers and team members and young people building their careers, because the rewards of that investment and commitment are there for the taking. Tonight we all have great pride in recognising our long history and that so much good work has been done by so many. In reality, cumulatively, tens of thousands of members over the years. We recognise them, thank them for their efforts and pledge our ongoing commitment to the ideals of the Institute. May I ask you to please charge your glasses and be upstanding; Ladies and gentleman, I give you a toast to the members of the AICM, past and present, I give you “The Australian Institute of Credit Management”. – James Neate National President, LICM CCE

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

AICM History

History of the Certified Credit Executive (CCE) program Presented to the CCE luncheon at the Canberra National Conference on Wednesday 11 October by CCE Director, Trevor Goodwin LICM, CCE At its time of introduction in 1998 the Certified Credit Executive program was the most significant development for members in the past decade. The program’s implementation would allow credit professionals to unlock their full potential and gain full reward for their efforts and achievements and enhance their professional growth and career aspirations. The lead up to the CCE commenced with initial discussion and planning way back in 1994 following discussion with the credit industry bodies in the UK and USA who had a similar professional program. The plan was to see the “CCE integrate fully with the Education Portfolio”. Major players and key drivers during the next few years prior to its commencement were Steve Thomas, from Western Australia along with Maurie Marchant of Victoria. Steve Mitchinson and Gerry Canavagh from W.A. also put a lot of work in to get the CCE program implemented. During the 1997 year it all began to ramp up. The CCE program was designed in detail, branded, promoted and marketed. Decisions were made on the format and design of certificates and the exam questions were written. All members of the Institute were written to by the President at that time, Steven Barratt, inviting them to participate in the CCE. The program’s aim was to be the Institute’s pinnacle award and provide recognition and creditability to the credit professional. It was to be the mark of excellence in Credit Management. The CCE designation was promoted to provide professional recognition to credit executives in the credit and financial industry, to certify their expertise, provide greater career security and career prestige and national respect amongst their peers. It was badged as “Unlock Your Full Potential – Become a CCE”.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Trevor Goodwin at the National Conference CCE luncheon. The first exam was held in 1998 at the National Conference at West Point Casino in Hobart. Ironically it was held at the casino as was a gamble for our first CCE credit professionals to take the risk of embarrassing themselves by not passing the first exam. There were 19 brave souls who sat the exam at the Hobart National Conference. An additional 15 who did not attend the conference sat the exam in their home State. Interestingly, Steve Thomas had to wait a year to sit the exam because he had helped set it up with TAFE in WA for the first exam. Steve a few years later organised the introduction of a Dux Award through National Credit Insurance (Brokers). Today NCI remains the sponsor of the Award which is the bottle of Grange. And so we have the CCE as it stands today because of the foresight and vision of our senior Credit Professionals/ Board members of the day. As CCE’s we should all be proud of our standing in the Institute and amongst our peers. As Gerry Cavanagh wrote in the Credit management magazine in 1998 “The best time to think of your future is today” Become a Certified Credit Executive.

Leadership and High Performance

From the chief of chaos to the custodian of calm in three steps By Petris Lapis*

Petris Lapis

Work (and life) has never been more hectic or messy and like a blender with the lid off, the more you crank it up, the messier it gets. You throw more and more balls in the air and work longer and longer hours in a vain attempt to keep everything afloat. You don’t dare take your eyes off the balls and while juggling you become more and more disconnected from yourself and others, until you stop one day and wonder what happened to your health, your relationships and the love you used to have for your job. You are drowning in expectations, key performance indicators (KPI) and deadlines. Even people you think of as successful are screaming on the inside and wishing it would slow down. Somehow, society has reached the point where being busy and overwhelmed is a badge to wear with honour. In the words of Dr Brene Brown, ‘exhaustion has become a status symbol’. We have become slaves to being busy. ‘How are you?’ ‘Busy, you wouldn’t believe how busy I am.’ ‘I hear you, same here …‘ The chaos is not going anywhere. Hoping you can hold on until it stops is a futile coping technique. Fortunately, there are things you can do to move from the chief of chaos to the custodian of calm despite the daily turmoil you find yourself immersed in.

Let’s start with the outmoded concept of ‘productivity’ and look at the work day differently Productivity was a relevant concept at the start of the Industrial Revolution when we were trying to produce more identical products out of a manufacturing line in a shorter amount of time. Surely that is no longer our goal? Will working more hours, producing more low-quality emails, or making more phone calls, even though they tick off KPI for the month, really result in the outcomes we should be chasing? Shouldn’t our goals now be related to the quality of the conversations we have and the connections we make, rather than the quantity? Shouldn’t we now be talking about ‘strategy’ rather than ‘productivity’? What if at the start of each day you were strategic and you: 1. Set your intention for the day with a focus on what you want to achieve, rather than spend the day mindlessly reacting. Your attention is driven by your intention. You can set it yourself or you can let others and ‘urgency’ decide where your attention and energy will be directed. 2. Set strong boundaries: One manager I know has a tiara on her desk that she wears when she needs quiet time to complete a project. She says, ‘No-one messes

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Leadership and High Performance

One of the reasons it is so difficult to cope with chaos in the workplace is because of the way our brains evolved.

with the Queen. When I put my tiara on that is who I become and the staff leave me alone.’ 3. Start ditching goals you have ignored for ages, activities that are a waste of time and people who drain you. Stop the unhelpful stuff and turn your attention to the people and things that really matter and will give you the greatest impact. Hanging onto all the rest just wastes time and energy (but provides a fantastic breeding ground for guilt).

Your brain is trying to kill you One of the reasons it is so difficult to cope with chaos in the workplace is because of the way our brains evolved. They are hardwired to notice changes in your environment. Thousands of years ago, these sudden changes could be a signal warning that we might be in danger of becoming breakfast for a sabre

tooth tiger. What used to keep us safe, now drives us bonkers. We are easily distracted by emails, text messages, conversations in the adjacent work station, ringing phones and the beeping of the printer that has run out of paper and which everyone else is managing to ignore. Unfortunately our brains are so hardwired to look for change in our environment that we are distracted by almost everything and anything that changes from one moment to the next. Fortunately, overcoming our brain’s wiring is a matter of choosing to behave differently. You can do simple things to help yourself, such as put your mobile phone in a drawer, turn off the email alert or close your door. If you desperately need to be away from distractions, take yourself to a coffee shop for a bit and divert your phone. Find ways to work with your brain. It is like the person you have been in a long-term relationship

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

with; there is no chance of changing how it behaves, so it is best to change how you behave.

When it’s not trying to kill you, your brain is getting you addicted Your brain comes with its own internal reward drug known as dopamine. When you finish a job, the high you get is due to dopamine. Each time you take a step towards a goal or cross something off your ‘to do’ list, dopamine goes wham and gives you a nice little feel good boost. Dopamine not only feels good, it is also addictive. Do you feel like you have to constantly check emails, tweets, facebook or text messages? Do you feel lost if you are without your phone? Dopamine is the reason. Each time we check and there is a message we like, we get a hit of dopamine as a reward. This is why we are constantly compelled to search for

Leadership and High Performance

messages in the same way a gambling addict is constantly compelled to keep trying for the lucky bet. No wonder it is so challenging to break our phone, email and social media habits. The best way to deal with the way our brain behaves is to remove the distractions by shutting down the alerts, putting our phone in another room or any other cunning strategy you can come up with. You can harness the power of dopamine for good by giving yourself a creative environment to work in, breaking big projects down into smaller chunks you can tick off, playing motivating music or going for a walk in your lunch break. Make use of the ‘reward circuitry’ in your brain to get you fired up and in control of your working day. Each time you tick off a task on your list, your brain rewards you with a dopamine boost to get you excited and motivated for the next one.

Look after yourself first Hip hooray for putting other people first and its nobility as an idea. Yes, it is important for us to provide

service to our community (work, friends, family etc), but the best way to do that is sleep well, eat well and look after your physical and mental wellbeing. Only then do you have what it takes to be switched on to making decisions, being present in conversations and motivated to take action. If you are not looking after yourself, it will be difficult for you to implement any of the actions that will be helpful to getting your life back in control.

How to get from the chief of chaos to the custodian of calm The simple truth is that working harder at working hard isn’t helping to take away the chaos and the panic that has become habitual in our working life. We need to do something else. So, when the smelly stuff is hitting the fan in your workplace and you don’t know how you are going to get to the end of the day, try this …. 1. Stop: Seriously stop what you’re doing, the rushing, the internal chatter about the serious situation

you are in and breathe … several times in and out. Pause and take stock of what is really going on. Get out of panic and back into control. 2. Prioritise: Do it like a pro. Act as if you were in the emergency department of a hospital. What needs your attention immediately and what can wait. Work out what is serious and what is a sniffle that can be sent home. Outsource what you can and tackle the stuff that really needs tackling. 3. Act: Calmly, purposefully and in the direction of your choosing take action. As an army officer once said to me, ‘Leaders don’t run as it panics the troops’. When you have done these three things, do them again … and again and again until they have become habitual. At that point, you will have moved from the chief of chaos to the custodian of calm.

*Petris Lapis B Com LLB LLM FIPA FFA – Corporate Training Programs For Leadership, Culture, Soft Skills and Mindfulness

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December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Leadership and High Performance

Be the leader people want to follow By Linda Murray*

A great leader is not necessarily the person at the top. A great leader is the person people WANT to follow. Leadership is not a gift or a privilege which comes with a new title; or a pay increase; or a slightly higher box on the Organisational Chart; or even a corner office! A position of leadership is an honour. It is an honour because it is earned. Like trust, or respect, the honour of leadership is earned over time when you consistently display admirable behaviours which deem you worthy of trust, respect and following. “Without the capacity to influence others, your ability to make what you envision a reality remains elusive because, after all, no one can do it alone. Without the ability to capture the hearts, minds, and energy of others, the truly important things in work and in life can’t be achieved.” – George Hallenbeck

Linda Murray

¾¾ You need to build strong relationships with your people. ¾¾ You need to make them feel valued. ¾¾ You need to teach them how to think for themselves. ¾¾ You need to show them “Why” so they can work out the “what” and “how”. ¾¾ You need to role model the behaviours you want to see from them. Be the leader people want to follow. And if you’re not 100% sure who that would be … be the leader you would want to follow!

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

I believe this requires two essential ingredients: zz The right mindset, and zz Making people feel valued

Leadership mindset What makes great leaders stand out? What are the traits or qualities great leaders display? It is qualities like authenticity, inspiration and approachability. Great leaders appear confident, are reliable and able to stand the heat. They are respected, humble and care for their people. When we look at what makes a great leader, interestingly, rarely do people talk about technical skills. Great Management is about what you DO. Great leadership is about who and how you BE. I often get asked: “Are leaders born or made?” My answer: both. Some people display leadership talent from a very young age so are fortunate to get a head start on their leadership journey. The great news is that everyone has the ability to practice and hone their leadership skills to become a truly great leader. Born leaders might have leadership talent. Yet all leaders, born or made, need to constantly work on building their leadership skills. Studies have shown that top performing executives attribute 80% of their success to their mindset. So, it’s really up to you to make the decision to want to be a better leader.

Leadership and High Performance

To adopt a mindset to be a leader who people want to follow. The work of Carol Dweck, Professor of Psychology at Stanford University, focusses on shifting your mindset to maximise your potential. Dweck speaks on the concept of a Fixed versus Growth Mindset. Dweck describes a fixed mindset as a belief that intelligence and ability are unchanging. You are either born with it or not. People with a fixed mindset tend to: zz Avoid challenges zz Give up easily zz Avoid feedback zz Believe their potential is capped People with a fixed mindset use language like “I can’t” or “I failed” or “This is too hard” Someone with a growth mindset: zz Believes intelligence can be developed zz Love challenges and setbacks, and see them as opportunities to learn and grow zz Enjoy putting in effort because they recognise it is the path to mastery zz Embrace discomfort because of what they will learn on the other side of it. Great leaders absolutely have a growth mindset. They believe they can constantly improve. They have an appetite to learn and to do things better. Similarly, they adopt a growth mindset towards the people they lead. Rather than getting frustrated because Charlie still hasn’t achieved that KPI; they truly believe that Charlie has the potential, he just hasn’t achieved it … yet.

Making people feel valued “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.” – Maya Angelou In our fast paced, complex society, it’s easy to keep conversations at a very

surface level. There is always business to talk about and updates to be reported on. As a result, we often skim past the opportunity to truly connect. Neurology Professor Richard Nastag says “We are not thinking machines. We are feeling machines … who happen to think”. As human beings (not human doings!), we crave connection. We want to feel heard and to know what we are doing really matters. This is why making people feel valued is your competitive advantage in becoming the leader people want to follow. In order for someone to feel valued, they must feel: zz Accepted zz Acknowledged zz Respected zz Worthy In order to build deeper, more connected relationships, these are the four words you need to have front of mind. I encourage you to make it a priority to ensure people around you feel these four emotions. People feel more inclined to follow a leader who makes them feel valued. So, how do you do this? When you are communicating, don’t just talk at the person and listen to what is being said. Listen for how things are being said. Listen For Understanding, Not Agreement (LUNA). When listening, don’t get distracted by planning your next response, or defending your opinion. Respect that we all have an opinion, so always be open to others opinions, perspectives, values and what matters to them. Become curious about what you might learn – either about that person and/or their point of view. If you notice yourself feeling defensive, ask yourself “Am I trying to be right?” Watch for visual cues. People give away a lot with their facial expressions and body language. Also, listen with your intuition. Notice what you are sensing when you connect with people. Observe a shift

in someone’s energy. Actually lean in and enquire about it. “Hey, something seemed to upset you then. Can I ask what just happened for you?” Great leadership communication is not about teaching or convincing. It’s about connecting and learning how you can bring out the best in all of your people. There is always a good reason behind peoples behaviour – good or bad. Think “How is this person feeling?” “What’s really going on for them?” “How can I make sure they’re feeling valued – accepted, acknowledged, respected and worthy?” According to a 2016 HBR study, and countless others, the number one reason people quit their job is because of the relationship with their boss! Making your team feel valued will ensure you won’t contribute to that statistic. Knowledge doesn’t change behaviour. Behaviour changes behaviour. Becoming a leader people want to follow is like a muscle. You need to practice it to build it. You won’t get match-fit in one leadership conversation. It’s daily commitment. You can keep doing things exactly the same and the result you’ll get … exactly the same! Or, see every interaction as an opportunity to dig a tad deeper; to lead better; to show that extra care factor; to leave an interaction with your team feeling empowered, valued and inspired to follow … because they WANT to.

*Linda Murray Business Coach, Executive Coach and Mentor for high performing professional women. Level 9, 53 Walker St, North Sydney NSW 2060. Email: linda@athenacoaching.com.au Ph: 0405 322 005 www.athenacoaching.com.au Are you ready to step up and be a leader people WANT to follow? Click here to download your copy of Linda’s ebook “The Little Book of Leadership Top Ups”. http://www.athenacoaching.com.au/the-littlebook-of-leadership-top-ups/

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Economic review

Economic insights from AICM National Conference By Kirk Cheesman* At the recent AICM National Conference in Canberra, I hosted an economic panel made up of key players in the credit insurance industry and posed a number of questions to the audience. Question 1 – Colour code the Australian Economy.

Overall, there were pro’s and con’s for the Australian economy. Whilst Australia’s banking and financial sector is solid, there are still pockets of industry sectors causing concern. This led to the bulk of the audience suggesting that some caution needed to be exercised. Only 5% considered the economy as being in a dangerous or unstable condition with just over 10% being much more optimistic. International political and economic risk was next on the agenda. Australia’s competitiveness in some sectors has ground to a halt, due to our high labour, electricity, and power costs. Clearly there are countries with which Australia cannot compete on labour costs. Despite our natural resources, the energy sector seems to be a thorn in the side of industry. These are two areas which need to be focussed on if Australia is to become more competitive.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Question 2 – What global zone concerns you more (political and economic risks)?

In this regard, ‘Asia’ received 47% of the votes, followed by America, the Middle East and Europe. It was pleasing to see that Oceania only received 1% of the votes. Given our location and reliance on Northern Asia, it is probably understandable that the concerns around political and economic risk are directed at Asia. Their influence on Australia is critical to our economy moving forward.

Economic review

Question 3 – What industry sector is likely to have the greatest impact on future economic conditions?

In moving our attention to industry sectors, the panellists were clearly concerned with the construction industry where the bulk of credit insurance claims have come from over the past 2 years. Despite this, there is still a high level of cover and appetite for the sector which generates a significant amount of premium for the trade credit insurance market. The interactive question relating to ‘industry sectors to be impacted most by future economic conditions’ were ranked by the audience as Construction, followed by Retail, Manufacturing and Mining. Lastly we discussed matters impacting the credit world.

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Question 4 – What will have the greatest impact on the availability of credit over the next 3 years?

Not surprisingly, audience responses highlighted (at almost 50%) digital factors as being likely to impact credit the most. Followed by cash flow requirements (banking/ factoring) and then insolvency law reforms. With each of these elements playing an important role in developing credit facilities into the future, we need to ensure that our systems and processes, both in terms of technology and people, are properly integrated and focussed on streamlining the assessment and approval of credit and in collecting payments.

*Kirk Cheesman Managing Director National Credit Insurance Brokers (NCI) www.nci.com.au Ph: 1300 654 500

Mendelsons Lawyers are a subsidiary of www.mendelsons.com.au info@mendelsons.com.au Contact our Client Services Team on 1800 641 617 Across Australia

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Economic review

Australia’s small to medium business sector looking beyond the banks to fund growth SME Growth Index highlights sector’s banking intentions, growth prospects and pain points By Peter Langham*

Peter Langham

Australia’s small to medium business sector currently has more varied funding options than ever before, and there are signs that increasing numbers of SMEs are willing to move beyond the banks to fund their growth. Given AICM members represent significant lenders to the small business sector – with responsibility over $80 billion on any given day – the SME mood for broader funding options that may strengthen cashflow should be on the radar of credit managers. Twice a year Scottish Pacific’s SME Growth Index looks at growth expectations and key concerns of 1200 owners, CEOs or CFOs of Australian SMEs across a range of industries, with annual turnover of $1-20 million. Since 2014, one of the main trends plotted by the Index has been the move of the SME sector towards non-bank lenders. The number of SMEs funding growth via their main relationship bank has fallen from 38% in 2014 to 27% in late 2017, while the number of SMEs using non-banks has risen from 10% to 22%. Non-bank lending includes debtor and trade finance and a

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

range of funding options offered by a growing number of fintechs in the market. Usually, the non-bank options have fewer loan conditions, flexible rates and higher customer service and lender flexibility than a standard bank overdraft, and, in the case of debtor and trade finance, there is no requirement for property as security.

Investment uncertainty Despite a politically supportive environment for SMEs (with initiatives such as investigating access to bank funding and efforts to reduce red tape and discover barriers to productivity), there are signs that many business owners are parking growth and taking a “wait and see” stance. The sector is uncertain about revenue growth prospects – only 48% of SME Growth Index respondents were predicting their revenue to rise through to February 2018, and on average these businesses were forecasting 4% growth. Around 23% were expecting negative growth. 28% indicated that their businesses would be stable or consolidating, up from 24% who placed themselves in this category in 2014.

Economic review

Scottish Pacific SME Growth Index – Forecast Changes in Revenue Next Six Months – Historical Trend % of Enterprises

Of greater concern is the broadening range of negative revenue change forecasts, blowing out from -3 to -8% in Round One of the Index to a broader spread of -4 to -13% in Round Seven (September 2017). This indicates that among businesses expecting revenues to decline over the next six months, many firms are flagging serious financial difficulty. For Index respondents, business investment intentions seem to be on the wane – 47% of SMEs expressed no plans to release new products or services, rising sharply from 31% in 2014. Around 30% of SMEs are planning to launch new services and 18% planning to unveil new products in the next 12 months. When only growth SMEs are taken into account, 56% plan new services and 37% new products, with 5% planning to introduce both. For SMEs with no change in growth, or declining growth, 88% have no plans for either new products or services. For the first time, the Index asked business owners about any impact of rising housing prices on the SME market. Already, one in 10 SMEs indicate that housing prices are creating a reduced demand for their products and services and 7% are holding back on new capital expenditure due to house prices making business investments riskier. This is an issue that should be monitored.

SMEs name dealing with staff as top productivity barrier

Australian SMEs forecast revenues to improve by less than 1% on average for the next six months to February 2018. This is less buoyant than the average 5% revenue growth SMEs were predicting three years ago. While twice as many SMEs predict revenues to improve in the next six months compared to those expecting revenue to decline, it is

worth noting that on average the declining SMEs are predicting a bigger revenue drop (-6%) than the average revenue increase forecast by growth SMEs (4%).This result is in stark contrast to Round One of the Index in 2014 when the positive change average that was forecast (9%) was more than double the negative change average (-4%).

SMEs employ more than two-thirds of Australia’s workforce, so it’s no surprise that within what appears to be an uncertain growth environment for many, workplace issues are high on their list of concerns. SME owners were clear when asked what was hampering productivity – they named staffing regulations (29%), excessive red tape (23%) and leave provisions (11%) as their main productivity constraints.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Economic review

The SME sector employs more than two-thirds of Australia’s workforce, and the Federal Government has rightly pinpointed this sector as powering Australia’s next 25 years of growth – for this to happen, the pain points SMEs have identified around staff issues, red tape and the reporting burden that comes with employing staff must be addressed. This insight is timely, given the immenent release of findings from the year-long Productivity Commission review. Our SME Growth Index data provides a valuable “voice of the customer” perspective on this important and difficult challenge facing the economy. Prime Minister Malcolm Turnbull, in announcing his innovation agenda, rightly pinpointed that start-ups and small business would power Australia into the next 25 years of growth. To fulfil the PM’s vision, governments must recognise that many business owners don’t have the resources to deal with difficult staff issues and this can make them hesitant to employ new staff.

Scottish Pacific SME Growth Index – Main Productivity Constraint on Business % of Total SMEs

Top priority for SMEs if they were “PM for a day” The SME Growth Index asked small business owners what change they’d make if they were Prime Minister for a Day. Their responses reinforce the finding that staffing issues are top of mind for SMEs, and also highlight that SMEs want the government to go further in simplifying Business Activity Statement reporting. BAS reporting was seen as the major drag on business performance by almost a quarter (24%) of SME owners, who see it as a significant administrative burden. Despite recent government efforts to streamline BAS, with the introduction of “Simpler BAS” for enterprises with a GST turnover of less than $10 million, the fact it is still SMEs’ number one area of concern indicates more needs to be done to relieve this pain point.

The Fair Work Act (22%) and company taxes (22%) are also highly emotive issues for SMEs. More work needs to be done to align the Fair Work Act with small business’ needs, while a lower company tax rate would also be warmly welcomed. Negotiating to remove state government payroll tax (8%) and respective state-based compliance

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

duplication (5%) are other immediate actions that would be taken if SMEs were running the country. Interestingly, a high number of SMEs provided unprompted feedback to this question, suggesting the introduction of lighter governance and compliance requirements (10%) and making leave provisions more equitable for SMEs (8%).

Economic review

Scottish Pacific SME Growth Index – “If I were PM for a day, the first thing I’d fix is…” Most Positive Impact on Business Performance

comparison with 3% of $1million to $10million businesses). Regardless of SME size, a very similar number of just over 22% of the SME segment nominated changing the Fair Work Act as their priority. Compliance and governance were greater issues for larger SMEs, with 13% of the $10million plus segment naming this as their priority, as opposed to 8% of the smaller SME segment. The priority of removing payroll tax (10%) and creating more equitable leave provisions (9%) resonated more with the smaller SMEs than the $10million plus sector. With the Federal Government’s Red Tape Committee due to table its report to Parliament in December, these results give all levels of government a clear indication of the actions SMEs would like to see.

What’s happening in the startup sector?

When investigating what SMEs would prioritise if they were PM for a Day, the Index went further and analysed responses based on the size of the SMEs. Of SMEs with a $10million plus turnover, one in five (21%) nominated streamlined BAS reporting as the priority change they would introduce. This finding confirms that even at

the larger end of the small business sector, there is material concern towards cutting red tape, specifically when it comes to BAS. The $10million plus turnover SME segment were more likely to nominate reduced company tax as their priority (23%, against 20% of sub-$10million SMEs), and had more of an issue with state compliance duplication (6%, in

Market wide, SMEs predominantly perceive themselves to be in a growth phase (37%) or stable phase (30%). The remainder of the segment is split evenly across consolidation (12%), outright contraction (11%) and start-up phases (10%). Despite a concerted effort by government and industry bodies to support innovation, only one in five positive revenue growth SMEs are in a start-up phase, consistent through all seven rounds of the SME Growth Index. As indicated in other Index results, taxes, credit conditions and the availability of credit are cited as the three main barriers to growth, clearly impacting Australian start-ups who require improved underlying market demand, less red tape, and tailored funding solutions. Until these issues are addressed, many brilliant ideas and new business opportunities will not be nurtured through to the highly challenging start-up phase – the economic and political climate remains daunting for bright new sparks to take hold.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Economic review

Non-banks closing the gap on banks The SME Growth Index highlights what business leaders see as the main barriers to small business growth – consistent with previous rounds, the top three hindrances for both growth and non-growth SMEs were: high or multiple taxes (75%), conditions of credit (69%) and availability of credit (64%). When only growth SMEs were taken into account, one other barrier was prominent – more than 60% of growth SMEs named cash flow as an issue that hinders their efforts to grow. Given these barriers to growth, it is not surprising that the gap is closing between when it comes to SME choice of funders. Non bank funding is the first option for 22% of SMEs, and a full 89% of SME owners plan to also use their own capital to fund new investment. 2017 has seen an almost 10% jump in the number of growth SMEs citing cash flow as a key barrier to business growth. This, combined with the continuing trend of SMEs moving towards non-bank lending, means the time is right for those SME lenders able to step up and solve the cashflow problems of growth businesses. Results have been rounded up or down to the nearest whole number.

*Peter Langham is CEO of ASX300 company Scottish Pacific, which is Australasia’s largest specialist working capital provider, helping SMEs increase cashflow and achieve their business aspirations. Scottish Pacific handles more than $15 billion of invoices each year, providing funding exceeding $1 billion and servicing more than 1700 clients in industries including transport, labour hire, manufacturing, wholesale, import and printing, offering debtor, selective invoice and trade finance and other solutions. For almost 30 years we’ve helped business owners improve their cashflow free from the constraints of traditional banking. Scottish Pacific was named Australia-Pacific’s Best Business Finance Provider in the 2017 International Trade Awards. The business has full service bases in Sydney, Melbourne, Perth, Brisbane, Adelaide, Auckland, London and China. www.scottishpacific.com, LinkedIn Scottish Pacific Business Finance and Twitter @ScottishPacific.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Credit Management

The Australian economy in 2018 - boom or bust? By Stephen Koukoulas* The year is ending with a widening divide between a buoyant business sector and ongoing caution from householders and consumers. In a nutshell, it is strong profits versus low wages growth that have been driving this divergence. For 2018, the themes are likely to centre on a recovery in nonmining business investment, further strong growth in State government infrastructure spending and an ongoing export surge, versus sluggish growth in household spending, which is being held back by weak wages growth and a likely pullback in house prices. New building of dwellings is also likely to turn negative through 2018 as the oversupply of apartments in many cities is unwound.

Stephen Koukoulas

The latest illion Business Expectations survey confirms an upbeat outlook for profits, sales, capital expenditure and employment in the early part of 2018. It is good news. But within that survey, it is the retail sector that is the weakest link, which is consistent with the official data pointing to a recent decline in retail spending. Importantly for Australia, the global economic environment is positive. China continues to expand, while the US economy is performing well. The surprise packet of 2017, the Eurozone, continues its path of economic recovery, aided by very stimulatory policy from the European Central Bank. Back in Australia, the positive tone in the business sector and likely rise in non-mining investment will underpin bottom line GDP growth in 2018. Low interest rates are helping cash flows and encouraging firms to ramp up their investment plans. For consumers and household spending, the greatest uncertainty is around wages growth and what happens to house prices, which had been an important source of wealth creation in recent years. Household spending makes up over half of GDP, so the health of consumer finances is a vital element in any assessment of the outlook for the economy. With wages growth stuck around 2 per cent, the ability of households to lift their spending growth is severely constrained. While spending can be

supported by extra borrowing or lowering savings, these sources of funds to support spending are only temporary. In other words, for a solid and sustained pick up in economic growth, to a pace above 3 per cent, household spending growth needs to accelerate, which in turns requires a pick up in wages growth. Amid these conflicting forces within the economy, inflation remains very low. The underlying inflation rate has been stuck below 2 per cent for the past two years and on the current RBA forecasts, it is set to remain at or below 2 per cent through to 2019. The recent illion data on business expectations for selling prices shows that price pressures remain weak. Given this measure has a good record in predicting future trends in inflation, it is likely that inflation through to the middle of 2018 – at least – will remain in check. In all, 2018 looks to be another year of moderate economic growth, with a solid business sector performance offset to some extent by softness in consumer demand. This means that inflation is set to be well contained at a low level, with the outlook for wages likely to be a highly debated and analysed part of the economy.

*Stephen Koukoulas is Economic Adviser to illion (formerly Dun & Bradstreet) publicrelations@illion.com.au http://www.illion.com.au

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

The expectation vacuum By Paul Burgess*

A customer had organised a payment plan that would see the debt paid over several months at the rate of a couple of grand a week. At the point of negotiation, the debt was already 120 days old and a formal letter of demand had been sent. The account manager/sales rep responsible for this account was querying why we had stopped supply. After a detailed explanation, the account manager said he understood but wondered why we had stopped supply. He did concede that it would be reasonable to suppose a customer would pay for goods they had bought on credit. In discussion with the Steelforce Australia Pty Ltd credit team, we delved into the void of understanding between supply and payment.

I couldn’t imagine going to my local supermarket, doing my shopping, and then telling them I would pay them later.

Paul Burgess

Particularly, why supply didn’t incorporate payment in its universal meaning. Between us we came up with the term ‘Expectation Vacuum’. This is the difference, the expanse, between the meaning of a sale from a sales perspective and a sale from a credit perspective. In our credit policy I have included the philosophy ‘A good sale is sale paid for in full and on time’. It supports the ethos of ‘a sale is not a sale until it has been paid’. I have just taken the ambiguity out of the ‘when’ for payment.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

But why is this a uniquely credit perspective? It would appear to be the centre of all cash sale events. I couldn’t imagine going to my local supermarket, doing my shopping, and then telling them I would pay them later, possibly look to make a payment arrangement at some given time in the future. Even to the most hardened sales professional, this would seem a tad unrealistic (and I have been told something that would not attempt to do). So why is a credit sale event looked at with different eyes? Why is it so unrealistic for a credit professional to hold new orders for a customer who is late paying for the previous order? In all fairness to the sales person, they only see a part of the process. In a cash sale event, the sales person sells the goods and walks the customer through the paying process. It is intrinsically the one and same process. Just separated by a step or two. Of interest, in this process if there is no payment, there is no sale. No goods released. In the credit sales event, the sales person is generally only involved in the first part of the process. I would be surprised if many of these same people are involved in the payments part of the process ever, and if they are, it is probably only with picking up cheques from the customer or the like. It certainly is not in negotiating payment plans, following up on missed payments, working through the myriad of legal issues, and let’s not get started with liquidation and PPSR returns. In many organisations there is a

Credit Management

real separation between the activities of the sales staff and that of the credit team. Through a series of baby steps, starting with getting involved in the national sales meeting held once a week, I have been getting more involved with the sales team. I now run Q&A sessions with branches on my regular visits. This is with the view of providing an understanding of the second half of the sales event to those who have never been exposed to it. This is an ongoing process, and as you can see from the opening paragraph, still some work to do. The success lies in consistency of message and tenacity of the

deliverer. It is as important for the sales team to understand what the credit team do as it is the credit team understand what the sales team do. After all, we are all rowing the same boat. I regularly go with the account managers/sales reps to meet with customers face-to-face. This builds a relationship with the sales people, with the customer, and lets me see first-hand the quality and space of the customer’s business. Let’s me see with a sales persons eyes and helps me to show the sales person how the physical links to the thought process. The credit function is unique in the commercial world, in that it

‘Expectation Vacuum’ – this is the difference, the expanse, between the meaning of a sale from a sales perspective and a sale from a credit perspective.

touches all aspects of the business simultaneously. There is no better helmsmen than a credit manager, but only if there is a holistic understanding of the vessel and the waters she rides in. Without this view, a credit manager can be trying to steer in the dark, or worse, against the wind. The first step in this filling of the ‘expectation vacuum’ is to break down the walls between these two areas and retrain our thinking to incorporate the philosophy that sales and credit are two halves of the same side of the coin. Without each other, there is no victory, no prize. For years we have belted sales team with trying to get them to understand credit, when what we needed to do was partner with them and have them ‘see’ what we do. In a culture that supports this interaction, there will be high success. Where there is no support for this interaction, the path is that much harder. What a day it will be when credit teams realise they are also an after sales service and sales recognise that they can support their customers buying more by working with them to make payment. We then close the gap between cash sale event and credit sale event. The uncharted territory of having the benefits of filling the ‘expectation vacuum’ flow into the market may well see a positive impact on insolvency for customers, reduction of tension on price-wars with competitors, and the softening of downward pressure on internal margins. Maybe even an increase in the value realised by credit departments around the world, and positive view by potential new entrants to the credit profession. In the coming week/s what will you do to fill the ‘expectation vacuum’?

*Paul Burgess, National Credit Manager Steelforce Australia Pty Limited Email: PaulB@Steelforce.com.au Tel: (07) 3900 6919

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

Achieving world class results in automating cash allocation By Trevor Middleton*

We visit a significant number of organisations each month to discuss collection processes and advise on improvement opportunities. What we often see is that the Cash Allocation process is one of the significant challenges that is holding customers back from taking the next step to improving their collection processes – yet it is probably one of the simplest back-office processes to modernize and automate. Why automate? Some of the inaccurate, time-consuming and cumbersome manual cash allocation process issues that we see are: zz manually printing, filing and/ or later destroying emailed remittance advices zz manually maintaining Excel

spreadsheets that cross-reference PAYEE NAME to CUSTOMERS. zz credit controllers distracted from core tasks at peak month-end times in order to help allocate and key cash into the financial system. zz having large quantities of unallocated cash zz customers failing credit checks due to unallocated cash issues zz customer monthly statements that are inaccurate, or having to be delayed until the cash can be allocated zz overtime paid, or staff working around the clock, to make this happen, doing lots of boring searches and manual data entry zz crucial cash allocation staff not being able to take leave, or highlighting a business risk when they are off sick or on holiday zz customers who are grumpy after receiving overdue payment reminder emails or phone calls, when they have in fact paid zz auditors making formal annual comments about the allocation process and related risks And worse still, this imperfect process is repeated month after month. Genuine Automated Cash Allocation processes can eliminate or significantly reduce the risks of manual cash allocation.

What is Cash Allocation Automation?

Trevor Middleton

Automation, as the name implies, allows you to significantly reduce the amount of manual time and effort your staff spent allocating cash. This

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frees the collections team up to focus on the real task at hand – collecting the cash. So whilst you may only have a few people in the allocations role, and the peak times are only a few days a month, having a reliable, accurate and fast cash allocation process is the foundation for all other collection activity – and is an improvement opportunity that can have significant staff productivity and customer satisfaction impact. There are automated solutions that are readily available and proven, that will: zz automatically monitor your Remittance Advice inbox, and process your remittances zz automatically download the electronic bank statement from your bank/s each day zz automatically match the payments to customers and the individual invoices that the payer has paid, zz allow you to do simple online customer and invoicing searching, to resolve payment anomalies zz integrate with your financial system , to automatically create and post the payment transactions, eliminating manual data entry zz automatically write off shortpayments and over-payments (if told to do so) zz handle cheque deposit and payment gateway payments appropriately zz provide online query functions to allow you to view historical payments, allocations, who did them and the

Credit Management

What is “genuine” cash allocation automation Like all automation options, there will be many claims of success. Surprisingly, a large number of ERP/financial systems have no automation capability at all. Some financial system will claim to have automated cash allocation, but on investigation that simply means matching the customer and applying the payment as “unallocated cash” onto the customer’s account. In some cases that customer-matching only happens if the customer specifically puts information in a particular reference field and format when they make their payment. That doesn’t always happen and is unreliable, and the effort required to train a customer base is significant. Sometimes the financial system will only match to invoice level if the payment matches a single, unique outstanding invoice value. “Genuine” cash allocation will match without intervention, across multiple customers, across multiple ERP/financial systems, to specific combinations of invoices and credit notes, to a high level, with confidence that there are no mis-allocations. The solution should have configurable “matching rules” to allow you to ‘tune’ the behaviour of the matching software to suit your particular business practice. “Genuine Automated matching “ needs to be measured in terms of both success and accuracy. The last thing you need is for cash to start appearing on the wrong customers’ account, or offsetting inappropriate invoices. According to the Hackett Group (independent bench-markers of Enterprise efficiency – www. thehackettgroup.com) zz “basic” matching might achieve a 50% match rate (to invoice level). zz “World class” matching is considered 66% or above zz “Exceptional” matching is 85% and above.

With Rimilia Alloc8 we have customers who are consistently achieving rates of 85% to 90% plus, with complete accuracy. The Business KPIs are: zz have at least 80% cash allocated before you walk in the door, with zz all allocations cleared and posted to invoices in the financial system by 9.00 am. Collectors having had their ‘outstanding debt follow-up call” schedule adjusted with today’s receipts before they start work – no wasted time trying to find out who paid today, no embarrassing customer phone calls to collect debt that has already been paid. There are some normal business scenarios that will inhibit you ever reaching 100% matching, such as new customer acquisition, customers changing bank accounts, mergers and acquisitions, etc. “Robotic Process Automation” (“RPA”) is a term that you will probably encounter in investigating these types of solutions. RPA improves the automation match rate each month , by allowing the matching system to “learn” how cash was allocated last time, then remember and re-use that for automation improvement when the next payment is received from that Payee.

So why should you automate cash allocation? Having quality transaction processing gives your customer the faith that you are ‘easy and accurate to do business with’. As a result, when it comes to a scenario where you have a genuine query with that customer, that reliability and trust makes them more understanding, and more likely to respond. Apart from the normal imperative of delivering continuous improvement, here are some of the reasons that we hear for automation: “Budgets are being tightened, we are constantly being asked to do more with less.”

“With the increase of mergers and acquisitions we are faced with increase in transaction volumes, sometimes across multiple financial systems”. “We want a firm foundation on which to build our credit collections improvement.” “The New Payments Platform” is being launched next year, letting customers make almost real-time payments throughout the day – 24/7. And wanting to use their PAYID to do it! How will I keep up ?” Automated cash allocation solutions like Rimilia Alloc8 allow that productivity and efficiency.

Where do I go if I want to know more? Successful Cash Allocation automation projects are happening all over. Average implementation times take 6 – 8 weeks, and can produce an ROI within six months or less. For example: “The whole project was a success from start to finish, and the benefits of Alloc8 started from day one. Our team is significantly more productive, and unallocated cash has reduced from over £6m to less than £60k, earning received from our external auditors” – Veolia UK – National Credit Manager For more information you can view the full webinar presentation on the AICM website (www.andrew.com) or visit the Rimilia Alloc8 website (https://www.rimilia.com/solutions/ alloc8-cash-2-cash-allocationsoftware). *Trevor Middleton Principal Consultant, Cosyn Software Ph: 1800 123 613 Email: trevorm@cosynsoftware.com

CLICK HERE for the Webinar

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

How credit managers can better assess the financial strength of companies without access to their financials By Stephen McKinney* Think of a word that encapsulates your day-to-day work; the research and due diligence you undertake, the assessments you make and the decisions you reach, as well as the near misses you avert and the consequences you face. If you work as a credit manager, I’d put my money on that word being “risk”.

Risk assessment Risk assessment colours everything we do, from where to cross the road on our way to the office in the morning, to whether we should sign that multi-million-dollar deal on favourable terms with a customer whose orders will be at the heart of our manufacturing operation for the next five years.

Some of us are risky; some are risk-averse; most would say we’re somewhere in between. But wherever we place ourselves on that spectrum, we like to think our decisions are based on sound judgement and careful appraisal of the facts. If you’re good at your job, they probably are.

Competitive edge But what if the facts are absent? Not all of them, but the central ones on which your decisions would usually rest – often those relating to company financials. What then? After all, Bureau van Dijk is in the business of certainty, and it’s something we all crave. In the case of big strategic decisions like the manufacturing example above, there are no workarounds. But when considering the hundreds of smaller decisions you and your colleagues make week in, week out – ones that, not individually, but collectively can determine whether your business is profitable – assessing peripheral facts, if they’re well-structured, relevant and contextualised, will give you an edge. This applies to credit analysts. It applies to procurement specialists. It applies to anyone who needs to assess any of the 275 million companies on Bureau van Dijk’s databases. Let’s take a quick analogy.

The balance of probabilities

Stephen McKinney

You’re a commissioning editor for a fiction publisher. At short notice you’ve been called to put forward for review at a meeting one of three

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manuscripts you’ve been sent. You haven’t read any of them. Two are from unknown authors but the author of the third has already published two critically and commercially successful novels under a respectable imprint, you know her agent, and the genre of her work is on the rise. Despite knowing nothing about the content of any of the manuscripts, it should be obvious from these related “environmental” factors which book most of us would put forward if we were pushed. Yes, we might be overlooking an undiscovered Hemingway but on the balance of probabilities the “safe bet” will – in most cases – be just that.

Environmental factors in the real world If, in your real line of work, you’d usually make decisions based on a company’s books – its balance sheets, profit and loss accounts, financial ratios, cash-flow statements and other financials – but they’re not in the public domain, the situation is surprisingly similar if you know what else to look for. When assessing the creditworthiness of a potential customer, the big question is: how can you assess a company’s financial strength – and therefore the financial risk of doing business with it – if you can’t access its financials? Well, some companies look at past relationships, for example. If the third-party company in question is

Credit Management

Group size and strength

Sector

Years in business

Shareholder 2

MORE score

Business environment

MORE score

a supplier, old records should show how quickly they delivered, whether everything was on budget, if there were any disputes along the way and the like. If the third party is a customer, payment history can be useful. There are plenty of channels to explore and it all adds to the mix. But they’re somewhat piecemeal and don’t apply to all companies, not least the ones with whom you have no past dealings. So how can you enhance your due diligence? As covered a blog post on our website, we have a well-established relationship with Italy-based credit rating agency, modeFinance, whose



 Rated entity  

Number of employees

  

Shareholder 1



Company’s experience and structure

Size



MORE score

Size

Subsidiary 1

Subsidiary 2

Size

standardising “MORE score” already appears on most of our company records that do have financial information; the new qualitative score is based on modeFinance’s research on and use of non-financial information in our databases. These variables include: zz The size and strength of shareholding companies and subsidiaries zz The average MORE score for the sector in which it operates zz Its management and number of directors zz Its experience and structure, such as years in business, number of employees, and capital and legal form

Sector

Average MORE score

Number of directors

Average MORE score

Management skills

MORE score

A white paper we wrote earlier this year goes into more detail on how these innovative and streamlined methods in qualitative analysis – or rather a quantitative analysis based on more qualitative, non-financial factors – can complement your existing processes. It shows how they could potentially add to the reliability of your risk assessments of all companies on Orbis (Bureau van Dijk’s global database of private and public companies), not just those with financials. * Stephen McKinney General Manager – Oceania T: 61 2 9233 3088 E stephen.mckinney@bvdinfo.com www.bvdinfo.com

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Phoenix

The new proposed anti-phoenixing laws By Roger Mendelson*

The thrust of the changes are aimed at illegal, fraudulent phoenix operators.

Roger Mendelson

The Federal Government has recently released a position paper in relation to proposed anti-phoenixing laws, which it intends to introduce. The Minister for Revenue and Financial Services has called for submissions. We have reviewed the proposals and believe that they do little to help both SMEs and the private sector generally. The thrust of the changes are aimed at illegal, fraudulent phoenix operators. Basically, these are people who intentionally create a company with a view to operating a business from it, incurring debts and failing to pay BAS obligations and probably also superannuation levies and other obligations to the government, as well as other creditors. When the heat from the ATO and creditors builds up, they simply jettison the company and begin business in a new corporate structure, leaving the creditors of the old company high and dry. There have been attempts made to stop such action in the past, with the most recent changes being The 2012 ‘Phoenixing Act’ and the 2012 ‘Similar Names Act’. Both Acts were deeply flawed and of no effective use. It is arguable that there are already adequate measures available against phoenix operators and that the major problem has been a lack of resources and resolve within ASIC to stamp the practice out. The proposed changes will have some benefit in that a particular number will be allocated to each director (Director Identification

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Number DIN) and this will make it easier to track directors and also to limit the use of “straw directors” (being either false names or alternatively, real people but who lack any assets and probably have no permanent address). In my view, the proposed changes are essentially planned in order to protect the tax revenue. Whilst there can be no real objection to this aim, the only problem is that it comes at the expense of other creditors. That is, the more special rights there are for the ATO, the less money there will be left over for other creditors.

The real problem The major problem faced by businesses and credit managers is not fraudulent phoenix operators but directors who operate companies which are clearly undercapitalised or have a business plan which has a low chance of success or directors who are simply incapable of running a business successfully. You will have all dealt with situations where the one director may be traced, through searches, to two or three failed businesses which, in each case, have been bled dry, with nothing left over for external creditors. Savvy credit managers will do credit checks and impose credit limits, in order to not be caught out by such operators. In most cases, they will also insist on obtaining guarantees from the directors. However, most business operators lack the resources of a sophisticated credit department and these are the businesses most at risk of losing money.

Phoenix

Our proposals Implementation of our proposals would be quick, easy, cost very little and impose minimal bureaucratic obligations on the business community. We believe that, if implemented, they would substantially reduce the risk of granting credit to SMEs.

Register of statutory demands Currently, Statutory Demands made under Section 459E of the Corporations Law are not publically recorded. In our experience, service of a Statutory Demand is the most effective, quickest and cheapest way to force payment action from a company, where the debt exceeds $2,000.00 and where it is not subject to dispute. We propose that a register be set up of Statutory Demands served, which are not satisfied. This would be a searchable register and it would provide a warning to credit managers. In many cases, if the Statutory Demand is not satisfied, the creditor does not proceed to liquidation, due to the cost involved (approximately $5,000.00) and the perceived risk of there being no return. If the directors fail to satisfy a Demand and keep the company trading, they become liable for insolvent trading claims by later creditors. However, this procedure is rarely used.

If the register were in place, it should be easy to search by ACN and if there are one or more unsatisfied Demands having being served, then warning bells should ring.

Solvency statement We recommend that directors of a company should be obliged to sign a “Solvency Statement”, if requested to by business, which intends providing credit of over a fixed sum of say $5,000.000 to that company. The statement would certify that the directors are of the reasonable belief that the company is solvent and if the company ultimately fails to pay a genuine debt for over $5,000.00 and the creditor has relied on the Solvency Statement, it would then be entitled to sue the directors for the amount of the debt. The sole defence would be that the company’s financial situation subsequently deteriorated.

Improvement in deregistration outcomes Voluntary deregistration is initiated by the directors and it involves them in signing a Statutory Declaration, declaring that the company has no creditors at the time the deregistration request to ASIC is made. However, every credit manager will have come across a large number of cases where they are chasing a debt and the company has been deregistered, meaning that the directors must clearly have sworn a false declaration.

Shady directors often use this process to get rid of a company which is insolvent, because it is a cheap process and it is not subject to investigations by a liquidator. ASIC should allocate resources to these companies and take action against directors who swear false affidavits. In addition, it should then be possible for creditors to sue such directors for their loss.

Deregistration by ASIC A large number of companies are deregistered by ASIC every year. Upon deregistration all of the assets of the company are supposed to vest with ASIC. Although many of these companies would have few tangible assets, many of them would have asset loans, made to shareholders, directors and other associated parties and these are assets which should vest in ASIC and be subject to action to recover those assets. Failure by ASIC to carry out this step simply aids both fraudulent phoenix operators and other dodgy directors. *Roger Mendelson is CEO of Prushka Fast Debt Recovery Pty Ltd and is principal of Mendelsons National Debt Collection Lawyers Pty Ltd. Prushka acts for in excess of 55,000 small to medium size businesses across Australia and operates on the basis of NO RECOVERY – NO CHARGE. www.prushka.com.au. Free call 1800 641 617. Roger is also author of The Ten Mistakes Businesses Make and How to Avoid Them and Business Survival, both published by New Holland Publishers.

The major problem faced by businesses and credit managers is not fraudulent phoenix operators but directors who operate companies which are clearly undercapitalised or have a business plan which has a low chance of success or directors who are simply incapable of running a business successfully.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Phoenix

Director Identification Numbers - ineffective against incompetent directors who may engage in illegal phoenix activity By Graeme Beattie and Jonathan Yee*

Graeme Beattie

Jonathan Yee

As part of the crackdown on addressing illegal phoenix activity, the government has proposed the introduction of a Director Identification Number (“DIN”) whereby a person who is currently a director or intends to become one will be assigned a unique identification number. It is anticipated that this will allow regulators, in particular the Australian Securities and Investments Commission (“ASIC”) to “interface with other government agencies and databases to allow regulators to map the relationships between individuals and entities and individuals and other people.”1 The government is anticipating that the DIN will be one measure, when combined with many other new measures to “deter and disrupt the core behaviours of phoenix operators, including non-directors such as facilitators and advisers”.2 We believe that the introduction of the DIN is a step in the right direction in ensuring that ASIC has a good, and more importantly, accurate record of directors that can be traced to individual companies. However, we consider the issue of illegal phoenix activity will still remain (albeit possibly

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

to a lesser degree) notwithstanding the implementation of DINs. In our view, individuals who choose to sign on to the role of company director fall into one of four categories: zz Those with prior experience but without formal education or a professional background; zz Those who are educated and have a professional background but no prior experience; zz Those with prior experience, education and business acumen; and zz The ill equipped, uninformed and uninitiated. With regard to the effectiveness of the DIN initiative in weeding out unsuitable directors, it is the final category that is of the most concern. Yes, there are bad directors who fall into the other categories. People who display conduct that is undesirable, do not adhere to the standard to which the Corporations Act requires and who seek to avoid or defeat the system. These will always exist in some form due to the self-interested nature of business and life in general, but the final category poses a different challenge to regulators. These individuals are effectively

Phoenix

allowed to hold a position that the general public and common person perceives to have a level of standing in relation to a company, with a risk that they have none of the skills required or awareness of the legal obligations and duties that relate to the position they have taken and role they are agreeing to perform. In order to be eligible to become a director an individual must: zz Be at least 18 years old; and zz Consent to taking on the role and responsibilities of becoming a director. In addition to the above, in order to be a director an individual must not: zz Be an undischarged bankrupt zz Have entered into a personal insolvency agreement under the Bankruptcy Act 1966; zz Have been banned by ASIC or a court from managing corporations under the Corporations Act 2001.

zz Have been convicted of various dishonesty related offences, such as fraud. There is no requirement that a new director hold any qualifications, have any prior experience, complete any courses, pass any exams or even have a basic understanding of how a company operates. In fact, once an individual has turned 18 they can set up a company and begin incurring liabilities in that entity. These directors may be susceptible to unscrupulous ‘advisers” or so called “pre-insolvency advisers” and the advice given, or simply activities undertaken by the director due to a lack of knowledge, could lead this type of director to ‘illegally phoenix’ their company without fully appreciating the implications. Therefore, whilst the introduction of a DIN will assist in addressing some of the issues that the newly introduced changes seek to resolve,

such as the verification of director information and the minimisation of duplicate records held by ASIC, it will do little to assist with ensuring only those that are competent and appropriate hold the role of director of a company.

*Graeme Beattie Partner Worrells Direct: (02) 8844 1212 Phone: (02) 8844 1200 Fax: (02) 8844 1211 Email: Graeme.Beattie@worrells.net.au *Jonathan Yee Manager Worrells Ph: (02) 8844 1200 Fax: (02) 8844 1211 Email: Jonathan.Yee@worrells.net.au

FOOTNOTES: 1 http://kmo.ministers.treasury.gov.au/ media-release/090-2017/ 2 http://kmo.ministers.treasury.gov.au/ media-release/090-2017/

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Phoenix

It’s not that hard to stop illegal phoenixing By John Winter*

Probably the most perplexing part of the current debate on phoenixing of businesses is why there’s so much debate about it. Let’s cut to the chase: we know that illegal phoenixing is ripping off creditors, its ripping off taxpayers and giving offenders an unfair business advantage. We also know that there’s a whole range of laws that can be used to stop phoenixing already in existence. We know that registered liquidators report over 8,000 potential instances of offences involving directors to ASIC every single year. We know that almost no-one is prosecuted for being involved in illegal phoenixing.

What’s actually going wrong? Well, the first and most obvious issue is that the evidence is not being converted into prosecutions. In the absence of those prosecutions, a strong signal is being sent to the market that you can phoenix and get away with it. The extent of that problem occurs because this has been going on for so long that it has now become endemic behaviour in some industries, to the extent that some company directors actually build their corporate structure with an engineered insolvency in mind from the start, taking their profit from not paying their bills.

Is it illegal?

John Winter

This is one of the most important questions. There’s good phoenixing and there’s bad phoenixing. Good phoenixing is what you’d properly call restructuring and turnaround. It’s taking a business in

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

some element of distress and getting it back in shape. Sometimes that requires debt compromises. Those debt compromises, though, are done with full disclosure and agreement and without undue duress on both sides of the table. It’s discussions that involve professionalism and integrity where you as a creditor can say to your debtor “ok, you’ve been honest about being unable to repay me, I can work out a deal with you that means I will get paid some of what you owe me now, but I will back you on that to remain a good and responsible customer in the future”. Everyone wins from that. And all business involves risk and compromise. Bad phoenixing is where you don’t have say as a creditor. Where your reasonable claim on payment, and on assets that may back that potential payment, are spirited away by some deceptive move and are hidden from recovery by you. We’d contend that s588FE(5) of the Corporations Act already gives the basis for prosecuting action against directors who do this type of bad phoenixing.

How do we stop it? Well, it gets stopped by real action. We have to send the signal to the market that you can’t get away with it and the cost for doing it outweighs the potential benefit. They’re pretty good at that in the UK. Companies House in the UK (their equivalent of ASIC) regularly promotes stories of their success in prosecuting dodgy directors. And so, the market responds with phoenixing being less endemic.

Phoenix

Aside from that, here’s a few key ways to end illegal phoenixing 1. Reduce the burden of proof We readily accept that it’s expensive and hard for ASIC to meet the evidentiary burden to enforce many of the aspects of the Corporations Act. So, let’s make repeat offending, even repeat usage, a strict-liability or administration offence with large dollar fines and director/officeholder banning. A similar regime already exists in bankruptcy under s 139ZQ of the Bankruptcy Act. 2. Director Identity Numbers There appears agreement on both sides of politics to make this law, but let’s ensure it does become a requirement. If we need a tax file number for personal income, surely we can require directors to have a registration that prohibits them using fake or slightly altered names. 3. Stop directors backdating resignations or abandoning companies These are two of the better suggestions in the current antiphoenixing proposals. That directors can wilfully abandon a company and leave it director-less is farcical. That you can back date a resignation with legal effect, even more so. We even support a regime in which both companies and individual directors have a mutual obligation to separately report resignations and registrations. The company structure brings with it privileges, it should also come with responsibilities. 4. Fund liquidators to pursue directors One of the main issues that gets exploited by illegal phoenixers is that a company is left so stripped of assets that a liquidator remains completely unfunded to pursue proper investigations. Liquidators are the first line of defence against phoenixers. The Assetless Administration Fund

We know that registered liquidators report over 8,000 potential instances of offences involving directors to ASIC every single year. We know that almost no-one is prosecuted for being involved in illegal phoenixing. (AAF) exists to support liquidators to do this, but, at the moment, the liquidator must make a lengthy application (when they are already unfunded) which has a low probability of being successful. The AAF needs to be larger and more easily accessible and to a significant degree.

course, that does place an additional burden on other creditors to become and remain active in the insolvency process – but we think that’s an important responsibility, regardless. This proposal is found in the current anti-phoenixing paper and we’d strongly agree with it

5. Require follow up on liquidator reports of director offences In every liquidation, a registered liquidator must report to ASIC if they suspect director offences have occurred. Currently, this disappears into a black hole. Creditors should hear back from ASIC about this before an insolvency appointment is concluded, and they should be told why ASIC isn’t investigating further or pursuing the directors. ASIC’s Annual Report 2015/16 reported that liquidators lodged 9,951 reports with 8,258 alleging misconduct. Of those, following supplementary reports, only 129 reports (1.5% of the reports alleging misconduct) were referred for compliance, investigation or surveillance. There were only 36 directors banned in this period.

7. Shut down the dodgy “pre-insolvency advisers” These dodgy advisers – almost all unqualified and currently unregulated – are the vultures who are teaching people how to phoenix their businesses and, largely, get away with it. They need to be shut down. How? Well each of them are currently giving advice that is either legal advice, tax advice or financial product advice. Guess what? Giving legal advice without being a qualified, registered practicing lawyer is an offence. Giving tax advice without being a registered tax practitioner is an offence. Given financial product advice without an AFSL is an offence. Sometimes the solution is all too obvious. Registered liquidators, and especially ARITA Professional Members, are a key part of the solution to addressing illegal phoenix activity. As a profession, we are tired of seeing this erosion of the confidence in the insolvency process, especially when the solutions are obviously at hand.

6. Restrict related party voting Phoenixing is all about transactions with related parties. Stop them voting on proposed removal and replacement of an external administrator (to the extent that a liquidator is aware of – or able to verify – a creditor’s ‘related’ status). That shuts them out of the process. Of

*John Winter Chief Executive Officer Australian Restructuring Insolvency and Turnaround Association

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Phoenix

The sliding scale of phoenix activity By Brett Martin*

Brett Martin

In my role as Assistant Commissioner Tax Evasion & Crime, one of my key focus areas is stamping out illegal phoenix activity. This type of egregious behaviour robs the Australian community of vital funds, casts shadows on legitimate businesses, and takes its toll on individuals. As such, I am passionate about making a positive difference in this space. Phoenix activity is the evasion of tax and other liabilities, such as employee entitlements, through the deliberate, systematic and sometimes cyclic liquidation of related corporate trading entities. The nature of Phoenix activity can cover activities which range from legitimate business rescue activities through to those deliberately using serial insolvency as a business model to engage in illegal activity such as avoiding debts, false invoicing and money laundering. The Behavioural Continuum below shows the sliding scale on which phoenix activity occurs. It ranges from commercial necessity, where a business is rescued legitimately, through to the illegal end where phoenix is used as a wealth creation strategy. It’s important to understand that occasionally the need to phoenix may arise out of events outside a business owner’s control – such as a loss of key customers. Business rescue is a legitimate use of the corporate form and we will work with those in this category to provide education and advice. We characterise this as generally

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

a single phoenix event, over a long period of time. Problematic phoenix is still considered legitimate, but it is detrimental to society. Generally, this is usually seen as two to three phoenix events over a relatively short period of time with the business owners viewing phoenixing as a way out of a problem. We work with this group to ensure that their behaviour does not become the norm and that they do not move to an illegal phoenix business model. Illegal phoenixing occurs when the controllers of a company deliberately avoid paying liabilities by shutting down an indebted company and transferring its assets to another company. Often, that company is then used to conduct the same type of business. This impacts creditors, government through lost revenue, and employees through lost wages and superannuation entitlements. In addition, there are a number of detrimental effects illegal phoenix activity has on the Australian community: zz Illegal phoenix operators don’t factor the cost of taxes and super into their pricing structures which gives them an unfair competitive advantage zz By not meeting their financial obligations, illegal phoenix operators can have devastating effects on innocent businesses and individuals, employees and subcontractors zz Illegal phoenix operators and their advisors understand the challenges within government systems and actively seek to

Phoenix

exploit them at every opportunity zz Community confidence is eroded by illegal phoenix operators, often because they maintain a personal lifestyle that does not match their income The ATO is a member of the Phoenix Taskforce which looks at all facets of the Behavioural Continuum, but is particularly concerned with illegal activity. The Phoenix Taskforce comprises over 20 Federal, State and Territory government agencies, including the ATO, Australian Securities & Investments Commission (ASIC), Department of Employment, and the Fair Work Ombudsman. The Phoenix Taskforce provides a whole-of-government approach to combatting illegal phoenix activity. As a group, we have developed sophisticated data matching tools to identify, manage and monitor suspected illegal phoenix operators. We support businesses who want to do the right thing and will deal firmly with those who choose to engage in illegal phoenix behaviour.

We work collectively to identify those who are undertaking this illegal activity. Our strategies are tailored to differentiate between those who pose a high, medium and low risk. Higher risk groups can expect strong scrutiny and if found to be engaging in illegal phoenix activity they will experience the full force of the law. Medium risk operators can expect a range of engagement activities that strongly encourage compliance with the law. We acknowledge that many who fall within our low risk category are undertaking legitimate businessrescue activities. We work with those in this category to provide education and advice on how not to fall foul of the law.

What’s being done about illegal phoenix activity The Government is considering a comprehensive package of reforms to address illegal phoenixing including: zz Director Identification Numbers zz Phoenix Hotline (for the public to

better report suspected phoenix activity) zz Enhancing ASIC’s powers around the liquidation process and the ATO’s powers around director penalties and security deposits. zz Targeting of advisors who promote or facilitate phoenix activity through expanding the promoter penalty regime to apply to them. The Government has also consulted on new preventative and early intervention tools, including: a next-cab-off-the-rank system for appointing liquidators; allowing the ATO to retain tax refunds; and allowing the ATO to commence immediate recovery action following the issuing of a Director Penalty Notice.

Transparency of tax debt measure Announced in the Mid-Year Economic and Fiscal Outlook of 2016-17, and currently awaiting passage of legislation, the transparency of tax debt measure will allow the ATO to disclose tax debt information to credit

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Phoenix

reporting bureaus of businesses who meet the following reporting criteria: have an ABN; have at least $10,000 of tax debt overdue by at least 90 days; and have not effectively engaged with the ATO to manage their debts. The intent behind this measure is to support more informed decision making, while reducing unfair advantage and encouraging businesses to engage with us as soon as practicable. In addition to the reporting criteria, there will be a number of additional safeguards to protect businesses trying to do the right thing. The ATO will undertake a phased approach to implementing this measure, focusing initially on companies and gradually expanding to other entity types. Tax debts will only be reported when the Transparency of Tax Debt measure passes legislation. There is

more information on this measure in a recent webinar available at https:// lets-talk.ato.gov.au/ToTD Illegal phoenix activity is not new. For many years government agencies have applied their respective tools to combat breaches of the law. There have been many solid outcomes, in both civil and criminal penalty terms. But some operators have not been sufficiently deterred. To them we say ‘be warned’. The regulatory landscape has changed with the creation of the Phoenix Taskforce and we are working closely together to catch those responsible. Our strategies will make illegal phoenix activity unviable in a financial sense. We will bring justice to those who persist in ripping off the community. At the same time, our strategies will protect honest Australians and provide a level playing

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

field to support Australia’s valued business community.

How to report illegal phoenix activity If you are aware of, or even suspect illegal phoenix activity, you can report it in any of the following ways: zz by phone on 1800 060 062 (ATO) zz by email to ATO at phoenix@ato. gov.au zz via the ATO website https://www. ato.gov.au/Forms/Tax-evasionreporting-form/ zz by phone on 1300 300 630 (ASIC) zz lodge a report of misconduct to ASIC at www.asic.gov.au For more info, go to ato.gov.au/ phoenix

*Brett Martin Assistant Commissioner Tax Evasion & Crime Australian Taxation Office

Phoenix

More legislation to fight phoenix activity? By Giles Woodgate and Richard Rowley* Discussion

Giles Woodgate

Richard Rowley

In September 2017 the Australian Government released a consultation paper setting out proposals to address illegal phoenixing activity. The proposals include: zz setting up a phoenix activity hotline; zz creating a specific offence in the Corporations Act 2001 (Cth) (“Corporations Act”) to prohibit the transfer of a company’s assets to a new entity with the intention of defeating the claims of creditors of the original company; zz limiting the backdating of director appointments and resignations; zz restricting the rights of related creditors to vote at creditors’ meetings; zz extending the tax promoter penalty laws to promotors or facilitators of illegal phoenixing activity; zz expanding the director penalty notice regime (“DPN”) to include goods and services tax; zz strengthening the effectiveness of the tax security deposit regime; zz improving the targeting of high risk entities; zz in some cases, Liquidators being appointed on a cab rank basis rather than by shareholders’ resolution; zz in some cases, reducing the period to act on a DPN from 21 days to zero days; and,

zz providing the Australian Taxation Office (“ATO”) with the power to withhold tax refunds due to the company. Some of the proposals in the discussion paper have merit such as limiting the lodgement with Australian Securities and Investments Commission (“ASIC”) of back dated director appointment and resignation documents, and providing the ATO with the power to retain refunds otherwise payable to high risk taxpayers. Other proposals such as the phoenix hotline or appointing Liquidators on a cab ranking system, suffer from an apparent lack of commercial reality. Even if all of the proposals in the discussion paper were implemented, the impact on illegal phoenix activity may be marginal.

False assumptions? One of the major problems with the current debate about phoenix activity is the lack of data about the impact of phoenix activity. The discussion paper referred to a report prepared by PriceWaterhouseCoopers (“PwC”) for the Fair Work Ombudsman in June 2012. That report estimated the cost of phoenix activity at between $1.8B and $3.2B, based on information for the year ended 30 June 2010 and a number of assumptions. PwC estimated the costs of phoenix activity to employees, business and government, of which the cost to

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Phoenix

business component was by far the largest at between $1B to $1.9B. The cost to business component was based on a report prepared in 1996 by the former Australian Securities Commission on the costs of phoenix activity and then indexed to 30 June 2010 values. Therefore, the costs of phoenix activity referred to in the discussion paper uses data, the source of which is partially at least 20 years old. It is not known how big or small the problem is currently. Prior to any proposal to combat phoenix activity becoming the subject of legislation, it would be useful to obtain up-to-date and relevant data as to the incidence of phoenix activity. ASIC could obtain such data through the reports required to be lodged by Receivers, Administrators and Liquidators under Sections 422, 438D and 533 of the Corporations Act. Usually such reports are now filed electronically. Some additional questions could be added to the Schedule B questionnaire, such as: zz Did the investigations detect any

evidence of phoenix activity? zz If so, estimate the gross value of the assets transferred from the company to newco. zz Was pre-insolvency advice involved in the transfer of assets to newco? ASIC has from time to time amended the Schedule B questionnaire, most recently to obtain further data about insolvent trading. There have been a number of steps taken by government to target phoenix activity, including: 1. in 1993 the introduction of the DPN regime; 2. in 2005 the provision of funding to ASIC to establish the Assetless Administration Fund, which now funds Liquidators to prepare reports in respect of assetless companies; 3. in 2007 the requirement that any company that changes its name six months prior to, or during an external administration, is required to disclose its former name, as well as its current name, on all public documents. Further, Liquidators

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

are required to report misconduct to ASIC, within six months of becoming aware of the possible offence(s); 4. in 2012 the DPN regime was extended to unpaid superannuation guarantee charge as well as unreported and unpaid PAYG withholdings. Further, directors and their associates were also denied credits for PAYG withholdings to the ATO; and, 5. in 2014 the ATO, State and Territory revenue offices, and other law enforcement bodies formed the Inter Agency Phoenix Forum to target phoenix activity. It is difficult to believe that none of these steps has not curtailed phoenix activity. It appears that one of the main drivers to stop phoenix activity, is the pressure on government to minimise the loss of tax revenue.

Books, records and documents Books and records are often missing in company liquidations, whether

Phoenix

phoenix activity has occurred or not. This is notwithstanding Sections 530A and 530B of the Corporations Act which were incorporated following recommendations in the 1988 Harmer Report. Section 530A imposes a positive duty on directors to deliver up the books and records of the company to the Liquidator, whilst Section 530B allows a Liquidator to obtain books and records from third parties, such as solicitors and accountants. As the Corporate Law Reform Bill 1992 noted, those powers were limited to the books and records of the company in liquidation. Pre-insolvency advisors usually have a good understanding of the powers of external administrators and the limits to those powers. Sometimes they gain that knowledge from being former insolvency practitioners, whilst others obtain that knowledge from their dealings as directors of failed companies. There is also some awareness in the business community that a Liquidator’s power to obtain books and records is limited to the company subject to the external administration. With the increasing complexity of business structures and the effect of privacy laws, this is a significant restriction on a Liquidator’s ability to investigate possible phoenix activity, along with other areas that warrant investigation such as insolvent trading.

An additional tool? Sometimes the Liquidator may have sufficient funds to conduct public examinations and may request the Court to issue orders to third parties for production of documents. The legal costs of conducting a public examination can be significant. The Liquidator’s remuneration will be an additional cost. However, more often than not, a Liquidator does not have the funds to conduct a public examination, let alone commence legal proceedings afterwards. Alternatively, if a Trustee in Bankruptcy has been appointed to the

A Trustee in Bankruptcy is not limited to examining the financial affairs of the bankrupt but may also investigate any company, natural person, partnership or trust associated with the bankrupt. estate of the director, the Liquidator may request the Trustee in Bankruptcy to obtain information that assists both insolvency administrations, by issuing notices under Section 77A of the Bankruptcy Act 1966 (Cth). This assumes a co-operative relationship between the Liquidator and the Trustee in Bankruptcy. A Trustee in Bankruptcy is not limited to examining the financial affairs of the bankrupt but may also investigate any company, natural person, partnership or trust associated with the bankrupt. Section 77A notices are a relatively low cost way for a Trustee in Bankruptcy to obtain documentary evidence, compared to applications to Court to obtain Orders for Production of documents. This can be very helpful in performing a number of tasks, including tracing of funds. Trustees in Bankruptcy obtained this power as a consequence of the 1987 amendments to the Bankruptcy Act 1966 (Cth) (“the Bankruptcy Act”). The Explanatory Memorandum to the Bankruptcy Amendment Bill 1987 noted that the amendments were made following concerns raised by the 1984 Costigan Royal Commission into the Federated Ship Painters & Dockers Union. Sometimes legislative change can occur via a circuitous route.

administrations; and, 2. align a range of specific rules relating to the handling of personal bankruptcies and corporate external administrations. It remains to be seen whether those objectives are achieved, following the Insolvency Law Reform Act 2016 (Cth) (“ILRA”) becoming law. It is a pity that in trying to harmonise the corporate and personal insolvency law in the ILRA, Parliament chose not to provide Registered Liquidators with the tool already available to Bankruptcy Trustees under Section 77A of the Bankruptcy Act. Perhaps a better way of disrupting phoenix operators is to broaden the powers available to Liquidators particularly to obtain documents which may assist their investigations.

Conclusion

Unfulfilled promise?

Alternatively, and in light of the judgment in ASIC v Somerville [2009] NSWSC 934, why wouldn’t ASIC just prosecute the directors and their advisors for breaches of directors’ duties and aiding and abetting those breaches? As a further alternative, ASIC could fund Liquidators at commercial rates to conduct public examinations and commence legal proceedings. In any event, does the law need to be strengthened or does the will to enforce it need to be sharpened? Submissions closed on 27 October 2017.

According to the Explanatory Memorandum to the Insolvency Law Reform Bill 2015, two objectives were to: 1. remove unnecessary costs and increase efficiency in insolvency

*Giles Woodgate and Richard Rowley are Registered Liquidators. Giles Woodgate is a Trustee in Bankruptcy. Giles Woodgate and Richard Rowley are partners of Woodgate Co., Turnaround and Insolvency. They can be contacted on (02) 9233 6088

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

Insolvency

Insolvency reform: A summary of the safe harbour law for directors By Frank Gambera* As you may be aware, on 1 June 2017, the Government introduced the Treasury Laws Amendment (2017 Enterprise Incentives No. 2 Bill) 2017 (‘the Bill’) into the Commonwealth Parliament. This Bill has now passed the Senate and is expected to come into effect on 1 July 2018. The Bill contains two major reforms to Australia’s insolvency laws: 1. A new ‘safe harbour’ protecting directors from civil liability for seeking to restructure financially distressed companies; and 2. Restrictions on the enforcement of ipso facto clauses to facilitate restructurings.

I. Safe harbour

Frank Gambera

The safe harbour provisions will apply where directors start developing one or more courses of action that is/are reasonably likely to lead to a better outcome for the company (rather than the appointment of an administrator or liquidator). Directors will not be liable for debts incurred directly or indirectly in connection with the course of action. The safe harbour period is taken to start when the director starts to develop one or more courses of action after starting to suspect that the company may become or be insolvent.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

While the directors will have the evidential burden of demonstrating the safe harbour provision is available, the director only needs to demonstrate a reasonable possibility that the safe harbour applies. The person bringing proceedings will, as per the Explanatory Memorandum, have to bear the legal burden to show on the balance of probabilities that the course of action being taken was not one reasonably likely to lead to a better outcome for the company. a) What is a better outcome? The Bill sets out an indicative but not exhaustive list of indicia that will be considered in determining whether a course of action is reasonably likely to lead to a better outcome. Such factors include whether the director: zz properly informed themselves about the company’s financial position zz took steps to prevent misconduct by the company’s officers and employees zz took appropriate steps to ensure the company keeps financial records zz obtained advice from a qualified entity and zz developed or implemented a plan to restructure the company to improve its financial position

Insolvency

Directors will not be able to utilise the safe harbour provisions where employee entitlements have not been paid when due and tax obligations have not been fulfilled

b) When will safe harbour not be available? Directors will not be able to utilise the safe harbour provisions where: zz Employee entitlements have not been paid when due and zz Tax obligations have not been fulfilled (ie. Tax returns have not been filed)

II. Ipso facto clauses An ipso facto clause creates a contractual right that allows one party to terminate or modify the operation of a contract upon the occurrence of an event, irrespective of the other party complying with their contractual obligations. The reforms aim to expand the scope for successful company restructures by placing a stay on the enforcement of such clauses. Such reforms will have an effect in agreements taking place after 1 July 2018 – that is, ipso facto clauses in contracts entered into prior to commencement will remain enforceable. While directors should be cognisant of such reforms, the ramifications will remain to be seen for a while. a) What is the period of the stay? zz In the context of an external administration, the stay period will commence from entry into administration until the administration ends. zz In the context of the appointment of a managing controller, the stay period will commence from appointment of the controller until their control of the company ends. zz In the context of an arrangement under Part 5.1 of the Corporations Act 2001 (Cth) (‘the CA’), the stay period will commence from when an entity announces it will be making an application under s 411 of the CA for the purpose of avoiding being wound up in insolvency until either the: —— Application is withdrawn or the Court dismisses the application —— End of any arrangement approved as a result of the application under s 411 or —— The affairs of the body have been fully wound up following a resolution or order for the body to be wound up. I hope the above summary of the Safe Harbour Law for Directors is helpful. As stated earlier this reform is likely to have significant impact on Credit Managers once the law becomes operational.

*Frank Gambera, Director McMahon Fearnley Lawyers Pty Ltd Email: fmg@mcmahonfearnley.com.au Tel: +61 3 9670 0966, www.mcmahonfearnley.com.au

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

aicm Training News 2017 High Achiever Awards AICM and the Board of Directors, we would like to congratulate and celebrate the following 2017 High Achievers across the following qualifications. The inaugural High Achiever Award recognises student’s outstanding achievements, and commitment throughout their studies.

Certificate III in Mercantile Agents

Certificate IV in Credit Management

Congratulations to Natalie Joseph from MSA Australia Pty Ltd (NSW) as the 2017 High Achiever for the Certificate III in Mercantile Agents.

Congratulations to Emma Hill from Hyne Timber (QLD) as the 2017 High Achiever for the Certificate IV in Credit Management.

Students are assessed on the following criteria:

quality and detail to the units of competency being assessed zz Overall engagement with facilitators and assessors zz Commitment to the learning process zz Quality of work zz Skills and knowledge growth and understanding over the duration of the qualification All current students of AICM undertaking a full qualification, and who complete their qualification before 30th June 2018, will be eligible for the 2018 Student of the Year or High Achiever Awards.

zz graduated a full qualification within the past 12 months zz participated in all online forums for their chosen units of competencies zz completed all Trainer Marked Activities for their chosen unit of competencies zz completed their qualification in the required timeframe, or a shorter timeframe zz submitted each of their assessments in the required submission timelines zz Assessment submissions demonstrated outstanding

Recent graduates Statement of Attainments: Francis Fisher

VIC

FNSORG401 & FNSINC401

Gaya Prasad

NSW

FNSCRD405 Manage overdue accounts

Kirk Gonzales

NSW

FNSCRD502 Manage factoring and invoice discounting arrangements

Angela Chan

NSW

FNSMCA301 Collect debts

NSW

FNSMCA301 Collect debts & FNSCUS402 Resolve disputes

Kenny Baumli

Naser Misaghi

NSW

FNSCRD405 Manage overdue accounts

Daniel Worth

NSW

FNSCRD405 Manage overdue accounts

Rochelle Ward

NSW

FNSCRD405 Manage overdue accounts

Andrew Karam

NSW

FNSCRD405 Manage overdue accounts

Manal Iaali

NSW

FNSCRD405 Manage overdue accounts

Kristina Hall

NSW

FNSCRD405 Manage overdue accounts

Vandhand Kumari

NSW

FNSCRD405 Manage overdue accounts

Lorraine Graham

NSW

FNSCRD405 Manage overdue accounts

Anja Bonnard

FNSCRD502 Manage factoring and invoice discounting arrangements

Tanya Nuuasoa

NSW

FNSCRD405 Manage overdue accounts

Nelida Iov

NSW

FNSCRD405 Manage overdue accounts

Vicky Simpson

NSW

FNSCRD401 Assess credit applications

Raiyan Mansuri

NSW

FNSCRD405 Manage overdue accounts

Anthony Sanderson NSW

FNSCRD502 Manage factoring and invoice discounting arrangements

Deepika Mudaliar

NSW

FNSCRD405 Manage overdue accounts FNSCRD405 Manage overdue accounts

NSW

FNSCRD502 Manage factoring and invoice discounting arrangements

Kusum Ranasinghe NSW

Timothy Soo

Luminita Solomon

NSW

FNSCRD405 Manage overdue accounts

Emma Vedris

NSW

FNSCRD405 Manage overdue accounts

Fatma Sayan

NSW

FNSCRD405 Manage overdue accounts

Erin Oldfields

NSW

FNSCRD405 Manage overdue accounts

Sadia Sharmin

NSW

FNSCRD405 Manage overdue accounts

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

aicm Training News 2018 February - June Face to Face Training Calendar – Melbourne, Brisbane and Sydney Melbourne:

15th June – Develop and Monitor Policies and Procedures (C,4),

12th February – Assess Credit Applications (C,4) 13th February – Telephone Collection Techniques (C,4) 12th March – Manage Overdue Customer Accounts (C,4) 13th & 14th March – Manage Factoring and Invoice Discounting Arrangements (E,D) 16th April – Manage Bad and Doubtful Debts (C,4) 17th & 18th April – Legal Compliance (C,D,4) 21st & 22nd May – Manage Factoring and Invoice Discounting Arrangements (E,D) 23rd May – Resolve Disputes (C,4) 18th June – Manage Risk (C,D) 19th June – Develop and Monitor Policies and Procedures (C,4),

Sydney: 5th February – Assess Credit Applications (C,4) 6th February – Telephone Collection Techniques (C,4) 5th March – Manage Overdue Customer Accounts (C,4) 6th & 7th March – Manage Factoring and Invoice Discounting Arrangements (E,D) 9th April – Manage Bad and Doubtful Debts (C,4) 10th & 11th April – Legal Compliance (C,D,4) 14th & 15th May – Manage Factoring and Invoice Discounting Arrangements (E,D) 16th May – Resolve Disputes (C,4) 4th June – Manage Risk (C,D) 5th June – Develop and Monitor Policies and Procedures (C,4),

Brisbane: 19th February – Assess Credit Applications (C,4) 20th February – Telephone Collection Techniques (C,4) 19th March – Manage Overdue Customer Accounts (C,4) 20th & 21st March – Manage Factoring and Invoice Discounting Arrangements (E,D) 23rd April – Manage and Recover Bad and Doubtful Debts (C,4) 7th & 8th May – Legal Compliance (C,D,4) 9th May – Resolve Disputes (C,4) 24th & 25th May – Manage Factoring and Invoice Discounting Arrangements (E,D) 14th June – Manage Risk (C,D)

Table of Explanation: C= Core Unit, E = Elective Unit, D = Diploma, 4 = Certificate IV

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.

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 Recent graduates continued... Martin Biddulph

NSW

FNSCRD405 Manage overdue accounts

NSW

BSBCNV506 Establish and manage a trust account

Yan Fen Chen

NSW

FNSCRD502 Manage factoring and invoice discounting arrangements

Ros Elly

NSW

FNSCRD405 Manage overdue accounts

Patrick Barry

VIC

FNSINC401 & FNSORG401

Michelle Zhang

NSW

FNSCRD401 Assess credit applications

NSW

FNSCRD504 Manage the credit relationship

Apoorva Apoorva

NSW

FNSCRD504 Manage the credit relationship

Neerav Giri

NSW

FNSCRD504 Manage the credit relationship

Yanqian Chen

NSW

FNSCRD504 Manage the credit relationship

Kellie Richmond

Eva He

James Diago

NSW

FNSCRD504 Manage the credit relationship

Michaela Stephens

VIC

FNSCRD502 Manage factoring and invoice discounting arrangements

Patrick Barry

VIC

FNSCRD502 Manage factoring and invoice discounting arrangements

Emma Purcival

QLD

FNSCRD402 Establish and maintain appropriate security

Michael Pearse

NSW

FNSRSK401 Implement risk management strategies

Sarah Sewer-Hardy SA

FNSINC301A, FNSMCA301A, FNSCUS402A, FNSMCA402A

Jasbeer Singh

NSW

BSBMGT502 Manage people performance

Ratinesh Lal

NSW

FNSCRD401A, FNSCRD402A

Anna Golubeva

NSW

FNSORG401A, FNSINC401A, FNSCNV506A

Diploma of Credit Management:

Certificate IV in Credit Management:

In-House Training:

Rubaiyet Sattar NSW

Kasey Medding QLD

BOC, Transurban, NHP

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

AICM Accreditation

Technology in action Number 1 = Robotic automation and the impacts of new technology in credit management AICM and CICM are working to implement a quality accreditation program that recognises credit departments commitment to excellence and quality, known as the CICMQ and delivered in Australia as the AICMQ. A core benefit of CICMQ/AICMQ is access to best practice and insights from fellow accredited organisations which produces thought leadership such as this article.

By Chris Sanders FCICM*

n March 2017 there was a headline in the Daily Mail which said ‘Will Sam the robot kill off the brickie?’ and then 2 weeks later it seemed that Sam the robot was out of a job as a house was ‘printed’ in concrete. Earlier this year it was reported that a McDonalds restaurant produced a burger to order with no human involved and a well known high street coffee shop would no longer need Baristas as the latte could be produced by robot, you wouldn’t even need to order it as it would recognise you as you came into the shop and have your ‘usual’ ready by the time you got to the counter. All of these activities have one thing in common which allows these roles to be automated, a predictable outcome, the robot/process knows what it has to do and therefore

Chris Sanders FCICM

does it. If you then apply this rule to everyday activities in the workplace, the potential for automation is staggering and the future impact on the workforce is significant. The impact isn’t really known as this sort of automation in the worksplace, in the grand scheme of things, is in its relative infancy, none the less it is here and Oxford University researchers have estimated that 47% of US jobs could be automated in the next 20 years, another estimated that 30% of UK jobs could be under threat. We are according to many in the ‘2nd Machine Age’. The ages of man used to last for thousands or hundreds of years like the Ice Age or Stone Age, but with man grasping new technology these ages are getting shorter. In the last 100 years we have had the ‘1st Machine Age’ (early 20th Century) the ‘Space Age’ (which started in 1957), the ‘Information Age’ or ‘Internet Age’ which is a term used for the 21st century and the speedy movement of data globally. The Information Age is technically only 17 years old and yet academics and economists are now saying we are moving into the 2nd Machine Age. According to the author of the book ‘Second Machine Age’ Andrew McAfee, he argues that this age involves the software based automation of tasks that replace labour unlike the 1st Machine Age that complemented labour. The first labour casualties will be the more unskilled

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

workers where the work is more predictable and repetitive and then moving up the scale as technology develops. Examples of this would be farm labourers but we see now on-line diagnostic tools for illnesses and more proactive and objective tools for analysis of business performance, stock markets and even grading exam papers. So what does this mean for Credit Management? Many of the tasks we perform in credit management, let’s be honest, are predictable. Credit Assessment taking data from different sources to understand business performance has been available for some time and these tools, ‘whatifs’, scorecards and predicting failure based on trends are getting better. Simple Collections activity has been automated in a complimentary way with systems generating letters and requesting calls through workflow again these have been around for a while as has automated Litigation and automatic Cash Allocation. The differentiator comes when these activities and the software that we use to drive them are linked together and they begin to learn what happened previously and then apply these learnings automatically. Cost reduction in the workplace involves all sorts of activities, process improvements, waste reduction, but the single most expensive thing is still people. Getting the systems to drive the people has

Q been a consulting mantra for some time, and moving people away from contacting everyone on their ledger to managing the exceptions has allowed large organisations like utilities to manage millions of customers without aircraft hangers full of people. The question asked by people who don’t understand operational customer management ‘What is best practice in terms of number of customers to a credit controller?’ is becoming an even more ridiculous question. Behavioural Scoring and Predictive Analytics have been around for a while, banks and financial institutions have used these for years to understand spending and payment patterns, this is why you get an unsolicited gold credit card application through your door… or not…but these tools are becoming more commonly available and cheaper so they can be used in everyday smaller businesses and with the developments in cloud technologies and application based development what was once impossible, not least due to cost, is now available on ‘payper-click’. As mentioned the real benefit comes from linking these various customer lifecycle activities and processes together. So what if you understand the payment method, the point in the cycle, what and when a customer pays? Organisations follow a pattern so the outcome is predictable they have a standard process, a payment method and a timeframe or internal payment term that they follow, in many cases what you do makes little or no difference, unless there is a problem. Add this knowledge to your risk assessment, propensity for late or non-payment and you start to see the potential. Software companies just in the collections space suggest that

70% of the collections effort is wasted, all we have to do is identify where to put that 30% of effort to get the same result. Most organisations have this data somewhere, the trick is getting hold of it in the large ERP systems which many organisations have. We have all heard the experienced credit controller say ‘He always pays on the second of the month’ capturing and managing this knowledge, understanding why and then build a system that captures this the allusive 30% becomes more obtainable. Specialist systems managing specific activities are built now with this level of information available for extraction. A great example of which is in cash allocation. Studies show that 85% of organisations use ERP systems for allocation with the required human intervention to perform the simplest of allocation tasks. These ‘Jack of all trade’ systems only achieve around 50% to 55% auto allocation, but smaller specialist ‘best of breed systems’ dramatically increase this auto allocation to over 90% also completing the task faster. As mentioned many credit management processes are predictable and there are a number of outcomes that we expect and with smart systems that learn these things tasks can be automated. The founding CTO of Uber Oscar Salazar said at a technology conference in Los Angeles in May 2017 ‘We are all responsible for adding technology to a society without thinking about the consequences.’ and that ‘…it may not replace jobs but it will change industries…’ and we all know that Darwin quote that it isn’t the strongest species that survives but those most responsive to change. As a credit management professionals we should try and

understand the impact of this sort of Robotic Automation technology. For example; Will it be necessary to offshore/outsource to reduce costs now if we can do this better and cheaper ourselves? We can automate the ‘call centre’ type low value high volume collections, how far up the value stack will this go? What will be the staffing and capability requirements of my future credit management team? Where does this leave SSCs, training, process management? What is the next generation of measures required to ensure effectiveness and performance? We have a responsibility to our organisations to drive performance, effectiveness and efficiency on working capital but there are still more questions than answers, but if the technologists and academics are to be believed the initial improvements and cost savings being delivered now will create a different working environment and we need to understand it better. For more information about the CICM Best Practice Network please contact cicmq@cicm.com or visit the CICMQ page on the CICM’s website www.cicm.com. Next Time: ‘New Technology in Business Information & Credit Assessment’ *Chris Sanders FCICM, Partner Sanders Consulting Associates Ltd E: chris@chrissandersconsulting.com Mob: +44(0)7747 761641 Chartered Institute of Credit Management Head of Accreditation – CICMQ E: chrissanders.cicmq@cicm.com SOURCES & ACKNOWLEDGEMENTS: • ‘Second Machine Age’ – Andrew McAfee • www.wired.com • Rimilia Ltd • PwC Technology • The Guardian • Hackett • Technology & Start-Ups – LinkedIn • Wikipedia • ‘The Rise of the Robots’ – Martin Ford

‘Improving Standards in Credit Management’

CICM

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

2017 National Conference

Conference Overview

“Best conference ever!” So said many delegates as the 2017 National Conference drew to a close. A perfect spring day for the Conference Golf Day, the most powerful and inspiring leadership forum yet, the most topical presentations, the most spectacular Presidents Dinner ever in the Great Hall at Parliament House and award recipients that inspired all were some of the factors that rewarded almost 400 credit professionals who invested their time to come together in Canberra for the 2017 National Conference. We must also mention the recipients of our most prestigious awards being of the highest calibre. Canberra being the meeting place of Australia and the location of our incorporation 50 years ago was chosen Mike Cutter, interim Group Managing Director Asia Pacific, Equifax. to host the 2017 National Conference. The marking of the anniversary will be a fond memory for Dr Leigh’s State of the Nation address reflected on the all that attended the presidents dinner in the Great Hall at challenges faced by all businesses due to technology Parliament House, there could not be a more fitting venue to and increasing pace of change, reminding all that risk celebrate our 50 year anniversary milestone, the awarding of assessment and management are even more vital. the Young Credit Professional Award, the first ever National Presentations took delegates from the not to distant Student of the Year and the Presidents Trophy. but complex future of Blockchain to one of the most Feedback from all members (including those that didn’t inspiring and relevant closing presentations on resilience attend) will help us improve in our quest to go one step delivered by our fabulous MC Robbi Mack. better in 2018. Please take a minute to complete the survey. To re-capture insights on insolvency, PPS, tough The conference is made possible by our sponsors collections, application processing, phoenix activity or any and exhibitors who are all central to many aspects of our of the other presentations, the slides are available shortly conference and industry. on the Credit Network. Please note some presentations To remind yourself as to how those sponsors can support have been altered and others are not available due to your business, read the sponsor and exhibitors company containing sensitive information and intellectual property profiles by clicking here. The AICM board and members thank all the sponsors And the winners are and exhibitors, especially: A big congratulations to the finalists and the winners of zz Equifax – Premium Sponsor awards this year. The winners are: zz Austral – Supporting Sponsor zz CCE Dux – Gerrad Harper, CGU Insurance Limited zz Dun & Bradstreet – President’s Dinner zz Credit Team of the Year – recoveriescorp zz Young Credit Professional of the Year – Nathan Wilkinson, Foundation Education Group Refresh your learnings zz Student of the Year – Anastasia Khayrets, BASF Australia The unofficial kick off for the conference over the last 4 zz President’s Trophy – Queensland Division years has been the Leadership Forum. This year Linda The acheivements of these people are celebrated on the Murray (Businesswomen, coach, strategist and mentor, following pages. speaker and trainer – Athena Coaching) empowered the delegates who included this as part of their conference with a new leadership mindset and will no doubt already be Relive the great times implementing the learnings with their teams. Photos of the speakers, exhibition and social functions are The first presentation of the conference was delivered by now on the Credit Network. Why not browse through these The Hon Dr Andrew Leigh MP, Shadow Assistant Treasurer. to relive some of the moments of the conference.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Conference Overview

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Karl Hill, Managing Director Results Legal.

Kathy Kostyrko, Director Hays Recruitment, Rowan McClarty, Joe Laban, Gregg Odlum and Rodolfo Duque.

The Hon. Dr Andrew Leigh MP, Shadow Assistant Treasurer.

President’s Dinner The President’s Dinner was held at one the most prestigious venues – the Great Hall at Parliament House and has been announced as one of the most memorable as we celebrated our 50th Year of Incorporation. Close to 400 members and industry representatives attended this dinner which featured political satirist Bryan Dawes, Announcement of the Young Credit Professional of the Year, the introduction of the Student of the Year award and a hit band that got almost everyone up on the dance floor! Our National President James Neate gave a stirring speech about the history of the AICM and the importance of the Institute in commerce. A video summarising the 50 years of AICM can be accessed here. As a long-term sponsor of the President’s Dinner, the AICM and the Credit Industry for longer than most can recall, it was fitting that the President’s Dinner was the place chosen by CEO, Simon Bligh to announce the relaunch of Dun & Bradstreet as illion!

Behind the scenes The conference is the largest gathering of credit professionals in Australia so we took this opportunity to connect with members and industry generally. We did this in two ways which may not have been immediately obvious to all delegates:

1 – National Meetings Southern Steel Group and the Building Industry Credit Bureau both took the opportunity to bring staff and members together the day prior to the conference. The AICM supported these groups utilising its existing arrangements with speakers and the hotel venue. This enabled more credit professionals to attend the Conference by reducing the travel costs associated if the meetings were held elsewhere. If you are interested in holding a meeting in conjunction with the 2018 conference please contact nick@aicm.com.au to see how the AICM can help. 2 – Industry Representation Recently the Minister for Revenue and Financial Services, the Hon Kelly O’Dwyer MP, announced the Government will consult on implementing a range of measures to deter and disrupt the core behaviours of phoenix operators, including non-directors such as facilitators and advisers. The AICM Board invited representatives of Treasury leading the consultations to meet during the conference. Fittingly the consultation was held following the ATO and ASIC’s presentation on Phoenix activity which allowed the AICM to clearly convey that members are impacted by illegal phoenix activity far too often. Following the meeting the AICM provided a 38 page submission to Treasury on the proposed measures, a summary of this is available in the AICM Key Policy Positions available here.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

2017 National Conference

Mark Russell, Managing Director – Corporate, Insurance & Professional Services, illion.

2017 National Conference

Conference Overview

Attendees at Wednesday’s leadership skills forum pose with presenter Linda Murray on the steps of the QT.

Grant Morris, Vlad Espinoza, Chris Williams, Vaios Kortkis and Andrew Smith.

AICM trainer Toni Sawyer LICM CCE and 2017 YCPA Nathan Wilkinson.

Simon Woodhouse and Mark Logue.

Nick Pilavidis, Peter Mills, Geoff McDonald, Grant Morris, Robyn Erskine and John Winter in the insolvency hypothetical.

Cynthia Thomas and Amanda Logan-Halaj of Austral Mercantile.

Simon Bligh, CEO illion.

Delegates congregate outside the AMPAC exhibition stand.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Conference Overview

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Amaran Navaratnam and Elizabeth Morris enjoy Linda Murray’s Leadership Forum.

Nick Pilavidis, Vaios Kortikis, Lisa Anderson and Jeff Hurst.

Rachel Burford and Terrence Costa of Electrolux practice their whistle blowing skills.

Kate Carnell, Australian Small Business and Family Enterprise Ombudsman

Attendees visit the trade exhibition hall.

Kirk Cheesman, Chris Doube, Colin Wagstaff, John Johnston and James Pearson.

Benny Kesuma of Bureau van Dijk.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

2017 National Conference

John Winter, CEO ARITA.

2017 National Conference

President’s Dinner

The Great Hall at Parliament House is set for the President’s dinner.

Catrina Galanti, Charles Tims, Nikki Dennis and Alison Said.

Brooke Lawrence, Lou Caldararo and Suzanne Chhour.

Frank Vredenbregt, Cynthia Thomas and Amanda Logan-Halaj.

Alex Pappas, Jan Reeves, Gloria Chan, Paul Clarke and Treacy Sheehan.

Jason Louis, Neil Ricketts.

Nunzio and Nuala Settenelli.

Dinner attendees in awe of SA Division President Gail Crowder’s dance moves.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

President’s Dinner

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Mark Draper, Emma Treblicock, Anastasia Khayrets, Mai Huynh and David McRae.

Elizabeth Morris, Graeme Annable, Louise Thomson and Karen Leggett.

Annette Giarratano, Debbie Rose, Melissa Giarratano, Dermot Ormsby and Jack Elias.

Hiten Vinchhi , Joe Laban, Andrew Spring, Bree-Anna McFarlane and Heather Spring.

Simon Bligh CEO illion announces change of name.

Kay and Brian Fullarton.

Craig Storkey, Timothy Holden, Andrew Worrell, Mahlee Terrell and Corey Hanlon.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

2017 National Conference

Conference delegates admire the entry to Parliament House.

2017 National Conference

Young Credit Professional 2017

A new generation driving change

Nathan Wilkinson.

Automation, crypto currencies and more offshoring is the AICM’s 2017 Young Professional of the Year award winner’s vision for credit’s future. Nathan Wilkinson is accounts receivable manager at the Australian Institute of Personal Trainers. Nathan’s 10-minute presentation delivered to secure the award was on the future of credit. He relied on his network to help him prepare. “I threw ideas back and forth to find an interesting topic and my mentors gave me their perspective on the future of credit. Constructive criticism was really important. I had to be willing to look at my work critically. It was also great to be able to practice with them,” he adds. Nathan’s preparation focused on body language, the strength of his message and his interpretation of the future. He believes automation and technology like voice recognition will disrupt credit. “We will also increasingly rely on overseas talent, which is considerably cheaper than in Australia.” He says the potentially for a cashless society and the rise of crypto currencies will also play their part in credit over time. “Digital currencies offer clients an extra way to pay. With cash flow so important, they are likely to be part of the future.” Nathan says he was naturally nervous as a young member of the institute engaging with older mentors as he prepared for the award. But the opportunity to get to know industry leaders far outweighed initial concerns. “I wanted to test my abilities and come out of the competition a better version of myself. Regardless of the result, anyone who enters will learn about themselves.” As the 2017 Young Professional of the Year Nathan had the opportunity to deliver an address at this year’s conference, which he says was, “absolutely fantastic.

James Neate, Suzanne Chhour, Peter Hamers, Alice Carter, Jack Elias, Nathan Wilkinson, Mark Russell and Simon Bligh.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Young Credit Professional 2017 He acknowledges he was fortunate to take the stage to thank his mentors and the AICM. “Without the institute you’d be stuck in your little whirlwind of work and not look to the horizon and see what other professionals are doing. The AICM’s relevance and importance is paramount to credit’s future success.”

South Australian finalist – Alice Carter of Lynch Meyer.

West Australian finalist – Peter Hamers of Wesfarmers Kleenheat.

New South Wales finalist – Jack Elias of CFMG.

Victorian finalist – Suzanne Chhour of recoveriescorp.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

2017 National Conference

Blockchain, crypto currencies and automation were all a focus. There was a lot I could take back to my team to help us improve efficiencies. “The network of people who attended were second to none; all the big names in the industry were there. I took every opportunity to bounce ideas off them.”

2017 National Conference

Credit Team of the Year

A team approach sets Recoveriescorp apart The team from recoveriescorp including Brooke Lawrence and Prashant Mathur took out the Credit Team of the Year award at this year’s AICM annual conference. The team have previously been runners up in this category. Recoveriescorp has been an AICM member since 2012, and Brooke says the institute plays an unparalleled role bringing together credit managers. “It’s a great organisation for us to be involved with and stay abreast of what’s happening in the industry,” says Brooke. Prashant says preparing the James Neate, Ian Hadwin and Neil Shilbury of Equifax present recoveriescorp award application was an opportunity Robert Martin, Prashant Mathur, Brooke Lawrence and Suzanne Chhour for the recoveriescorp Credit Team with the winning trophy. to proudly reflect on the contribution the team had made to the customer experience, especially when it came to hardship customers. “It was a great learning process to see how far we’ve come and what we’ve all achieved, especially the initiatives we‘ve implemented to co-partner with NAB. We’ve got a great team of skilled operators,” he says. Recoveriescorp has a partnership with NAB to manage accounts in James Neate, Mark Poile , Hiten Vinchhi, Michelle Kirkwood, Leanne Fizzell, Neil arrears as well as hardship clients. Shilbury, Heather Spring, Ian Hadwin, Maggie Jaouhara and Bree-Anna McFarlane. Brooke says the award is also useful to see what other credit providers are doing in the important recognition of the high-performing nature of the industry and any changes they’ve gone through,” she says. team’s individual members. Says Prashant: “It helps you get an understanding “The NAB Team in particular have achieved much over about where you’re placed in the credit industry relative to the last year. We have journeyed with NAB as they have your peers.” Brooke says she would strongly recommend started to rebrand some of their hardship products. Part participating in the awards and attending the AICM of our success is the open and transparent relationship we conference. have with NAB,” she explains. “There are 30 people in our team, and six were able to Brooke says what’s paramount in recoveriescorp’s take part in the presentation stage of the award process. It relationship with NAB is representing its brand. was important that the Award was something every person “We offer NAB resources to manage debt recovery, in the team shared in from start to finish,” Prashant says. keeping in mind many are vulnerable customers going “We made a video as part of our presentation, which through hardship,” she says. Commenting on this year’s captured the input of team members who didn’t present, Conference, Brooke says the team was especially interested allowing every team member the opportunity to contribute to learn more about the National Payments Platform. to the award submission. Getting everyone involved in the “Hearing guest speakers present on trends and the process helped us be recognised and acknowledged for our economy gives us valuable insights we can use when having accomplishments,” he says. conversations within the business or with clients. It’s also

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Student of the Year

Anastasia Khayrets is the AICM 2017 Student of the Year, an incredible accomplishment given she only moved to Australia from her hometown of Volgograd in Russia in 2012 as a skilled migrant. Anastasia initially started working for her current employer BASF as an accounts coordinator and now supports the credit management team. She started studying to obtain the Diploma in Credit Management in September last year. “I enjoy being involved in the process of taking decisions on credit and I wanted to improve my theoretical knowledge and understanding of the Australian economy. “So I decided to study credit management to achieve a formal qualification. Among hundreds of education providers in the field, AICM is the only membership body that is well-recognised, prestigious and reputable,” she says. Incredibly, Anastasia completed the three-year diploma program in seven months. “The opportunity to study online via AICM’s learning platform was beneficial and convenient, as I could combine studying and working full time in a busy corporate environment. “It also gave me a chance to be in constant contact with my fantastic facilitator, Toni Sawyer, who provided prompt advice and feedback. Taking part in forums was an important way to communicate with other students, taking into account different experiences, approaches and opinions,” she says. Anastasia says her favourite subjects were corporate insolvency, personal insolvency, legal compliance and managing the credit function. “I learnt to apply an holistic approach to credit management processes and consider the external and internal factors that impact credit. Credit managers are not just the guardians of cash flows, they are also critical in the process of creating sales opportunity and value,” she says. This year’s AICM National Conference was the first Anastasia has attended. “It will remain in my memory as a magnificent event. It completely met my expectations and I made

connections with many interesting people and company executives. “I had a chance to upskill at specialised learning sessions, become familiar with the latest industry trends and collaborate with hundreds of other credit professionals. Thanks to all the partners and sponsors for assisting AICM to organise this fantastic event. The dinner at Parliament House was for many of us a once-in-a-lifetime experience,” she says. Anastasia recommends the Diploma in Credit Management course to all entry-level credit and collections officers to obtain basic theoretical knowledge and skills in credit management. “It could also be beneficial for more advanced credit professionals wanting to upgrade their skills and jump to the next level in their careers,” she says. Commenting on AICM’s half century, Anastasia says, “fifty years of incorporation is a milestone for any organisation. The institute plays a uniting role in the credit management community, bonding individuals and organisations with a spirit of camaraderie and professionalism. I am certain AICM is looking toward an even more sustainable future and an ever-increasing relevance in credit.”

Anastasia Khayrets.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

2017 National Conference

Student of the year completed diploma in record time

2017 National Conference

CCE Dux and Re-certification

CCE benefits the whole team Gerrad Harper, Certified Credit Executive (CCE) Dux for 2017, first became involved with AICM in 2006. “I had been a Credit Manager for a couple of years and wanted to become part of a professional body to expand my knowledge and networks,” he says. Gerrad completed a Diploma of Financial Services in 2011 and, after a few years’ hiatus to give him a break from studying, decided to enrol for the CCE in 2016. He is currently a Credit and Legal Manager at CGU Insurance. “I was aware the CCE was the highest qualification and I was motivated to get to the next level. It was another challenge for me and I also had to find the right time to do it, considering all my other obligations,” he says.

The advantages of the CCE

Gerrad says one of the best aspects of the CCE is the ability to put into practice everything he learnt during the course. This has benefitted his credit team and CGU’s wider business. “We have undertaken a significant change management process over the last few years. I have asked a lot of my team as we have moved to more Gerrad Harper automated workflows. It’s been a huge turnaround,” he explains. According to Gerrad, he was able to apply information absorbed studying for the CCE directly to his role. And conversely, a lot of his work experience was also ready to be applied to the CCE essay. “You have to read extensively and stay on top of what’s happening in the industry. Then once I picked my subject, which was Accounts Receivable Management, it was a case of drawing on real issues in the workplace to use as case studies.” He picked eight issues on which to focus on across three main areas – installing new systems, revising terms and conditions, and managing accounts. “Some of the issues I focused on in the CCE had been ongoing in our business and needed to be either overhauled or refined with ongoing monitoring. It allowed me to provide the team with the tools they needed to do their job better.” As a result, CGU’s cash flow has improved, payment terms have been reduced and customer interaction is more NCI Managing Director Kirk Cheesman presents the CCE informed. “We’ve experienced a range of improvements, Dux Grange to Lou Caldararo on behalf of Gerrad Harper. really, and the team has been able to see the benefits and results of these efficiencies.” Gerrad would recommend the CCE to anyone wanting to advance their career. “It’s really rewarding because it’s quite a challenge. It forces you to look at your career and credit management from a strategic standpoint. That’s what the CCE is about. “Credit Managers in all industries need to constantly update their knowledge and expertise, and the CCE allows you 2017 newly minted CCE’s – Chris Williams, Decia Guttormsen, Rex Cheng, Tanya Nightingale, Rhys Buzza, and Donna Smith receive their certificates from Trevor Goodwin. to do that,” he says.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

CCE Re-certifications

2005 – Nella Simeoni, Trevor Goodwin and Simon Dawson.

2002 – Trevor Goodwin and Barbara Proberts.

2011 – Lisa Anderson and Trevor Goodwin.

2008 – Anne Wilkins and Graham Swan.

1999 – Andrew Le Marchant, Abraham Cohen, Trevor Goodwin, Frank Vredenbregt and Charles Tims.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

2017 National Conference

2014 – Amit Jaiswal,Trevor Goodwin and Greg Young.

2017 National Conference

President’s Trophy

Queensland councillors Decia Guttormsen and Peter Mills accept the President’s Trophy for best performing state.

President’s trophy: Queensland on top Queensland has taken out this year’s AICM President’s Trophy award. Qld AICM President Roger Masamvu says the award recognises the efforts of the hard working people in the Queensland council. “We work very closely with the national office so that we can achieve our goals, engage members and provide networking opportunities and a community for credit professionals,” says Roger. “We dedicate a lot of time to putting together events and listening to members and hopefully that’s reflected in this award,” he says. Like many people, Roger fell into a credit role and found it suited him and subsequently joined AICM in 2013 as a support network. “At first I didn’t even realise there was a member body for credit people. I had been doing research on my own to inform my work and didn’t realise this great network existed,” he says. A past winner of the Qld Young Credit Professional of the Year, Roger has been closely involved in building the Queensland division for many years. “The members in Queensland are a great bunch. New and existing members are able to find out all about what’s happening in different industries. We also share information about new processes and best practices. “We are lucky to have a great group of people on council who know how to have fun and can be serious when they need to as well. It’s a really supportive environment for young members in particular, with older members always

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

James Neate, Toni Sawyer, Nathan Wilkinson, Peter Mills, Elizabeth Morris, Warwick Ballantine-Jones, Erica Barron and Decia Guttormsen proudly display the trophy.

Queensland crew excitedly celebrate their achievements at the President dinner. willing to take new people in the industry under their wing, even when they may not yet be a member,” he says. Now in the role of Queensland president, his focus is trying to help members as much as possible and assisting his fellow councillors. “No one gets paid to do the job. So it’s a balance in terms of who’s doing what and how much people are giving,” he says. Roger says the award follows three years of hard work by the Queensland team. “We do focus on member engagement and ensuring the topics we cover at our events are really relevant. There’s a lot more value we could be giving members and we’re getting that happening.” Roger says the AICM’s 50th anniversary is an important milestone for the credit sector. “It’s a good opportunity to look back. In life, you’re always looking forward, but sometimes useful when you reach a milestone to look back and appreciate what has happened in the past. As our membership grows, it’s important to remember where we came from.” He also says it’s essential to acknowledge the businesses whose staff are members for their support of AICM. “People like me who are involved with the council dedicate a lot of time to be able to make the contribution we do and sometimes this overlaps into working hours. “So it’s good to know employers see the value in being an AICM member and support the institute. I think it’s important that goes on the record,” he says.

See you at AICMâ&#x20AC;&#x2122;s

2018

NATIONAL CONFERENCE 17 - 19 October 2018 MELBOURNE Visit aicm.com.au for details and registrations

AROUND THE STATES

New South Wales

Back row: Asheem Khan, Michelle Brown, Patricia Talsma, Misty Lee Turner, Linda Powell, Deline Manuel, John Pamboris – Credit Manager Jaybro. Front Row: Sev Indrele – Credit Manager Orange Hire and Carlie Dunn.

The Australian Institute of Credit Management welcomes our Partners for 2017. National Partners

Divisional Partners

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.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

President’s Report As we are winding down for 2017, I have been reflecting on what has been a momentous year for us all. Even though, as a Council we have always boasted that we are more like ‘friends’ rather than ‘colleagues’; the passing of our dear friend (and leader) Col Magee left us devastated and disconnected from one another. We all share the loss, and miss him immensely especially during our face-to- face meetings. But, funnily enough, when making an AICM related decision we stop and ask ourselves ‘What would Col do?’, ‘What would Col say?’, ‘What would Col want?’ This is his legacy, and the influence he still has over us today. As a result however, there has been a lot of growth and development which has united the NSW Council; and I am proud to work alongside each and every one of them in 2018. The Pinnacle Awards are being held in the first week of December, and due to the very hard work of our National Office, and Council, our event is a completely sold out. It is a real accomplishment to host such an event, where our high calibre of award nominees are able to network and meet our wonderful members of the AICM. In addition, the Pinnacle Awards provides the AICM members and guests with the opportunity to celebrate the year and wish each other well for 2018. Whist it is a great way to end the year, we do have a lot to look forward to as we settle back into work in 2018. Some highlights include: 1. A Symposium will be held in February 2018 which provides a complete summary of all the recent and proposed changes to the laws relating to Credit, Debt Collection and Insolvency. As well as practical solutions to the problems that are faced by Credit Managers from a speaker that knows the subject, Geoffrey McDonald, both as a Barrister and an Insolvency Practitioner. 2. Barefoot Bowls Youth Networking Night in early 2018. 3. Industry forums which address niche areas of concern and issues for our members. Wishing you a very happy and safe Christmas and New Year from all of us here in NSW, – Balveen Saini

New South Wales AROUND THE STATES

(LtoR) Grant Morris (NCM Southern Steel Group), Stacey Smith (Ferrocut – SA), Rachel Jones (Rigby Jones – NSW), Lee Doel (Southern Steel – NSW), Merna Spain (Brice Metals – SA), Vicky Sprecak (Southern Queensland Steel – Qld), Terri Pickett (Surdex Steel – Vic), Susan Chen (Surdex Sheet & Coil – Vic) and Greg Sellick (RPG Australia – Qld).

this new role at Orange Hire due to the growth of the company and the excitement of bringing her deep skills to a new role. Click through using this link to see Sev and the other NSW councillors’ profiles and make sure you come and say hello at the next function.

Company profile – Southern Steel

AICM CEO Nick Pilavidis and Rhett Kipps.

Practical tips for legal recoveries Barrister Rhett Kipps provided the audience with a wealth of knowledge on how to structure your recovery action and to be prepared when considering whether to pursue your claim through the court process. Lively debate ensued with the audience very engaged and wanting to hear more of how they can improve their recoveries process. The presentation was held at the offices of CPA which was our first time using their great facilities which members and guests enjoyed and we look forward to meeting at CPA in 2018.

Councillor profile – Sev Indrele NSW Councillor Sev Indrele recently changed roles and has commenced as Credit Manager with Orange Hire at Arndell Park. Orange Hire is a fast growing rental company providing Plant & Traffic equipment to the civil construction industry, and serves 65% of its equipment on the East Coast of Australia. Sev is a passionate credit manager with over 18 years’ experience. Sev has worked in the equipment hire industry for the past 8 plus years, specialising in risk and recoveries. She was drawn to

Grant Morris, National Credit Manager at Southern Steel Group, saw the AICM national conference as an ideal opportunity to bring together many of the businesses’ Credit Managers to workshop and share best practices and new methods whilst also network and learn from the conference proper. Grant worked with the AICM to book meeting rooms and facilities on site and arrange speakers such as James Neate (Lynch Meyer, SA – account applications and terms), Malcolm Poslinsky (EDX NSW – all things new and critical in PPSA) and Anna Taylor (Results Legal Qld – electronic signatures). He also arranged a video link with the Group GM and a GoToMeeting with their IT guru who talked about their upcoming system upgrade. With a day to themselves the group held a workshop on best practice in account lapsing, data maintenance, trading terms, grace periods and account actioning, risk monitoring, credit limit review processes, post to email conversion of invoice/statement despatch, cash forecasting and much more. It was a long and full day and by combining it with the national conference over the following 3 days they were able to continue discussions, better understand others processes and difficulties and meet a large number of credit managers many of whom they had talked with over the phone or exchanged emails. The educational elements of the conference proper were the icing on the cake. This was the first time the Southern Steel credit management leaders had been together and the experiences gained and shared were invaluable. They are already seeing real benefits in their workplace and the business and the team members are both winners. There were concerns about maintaining response times to normal workload however with a little planning and through the use of 21st century technology the team was able to accommodate 4 days away from their official workplaces. Planning for next year is already underway. December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

Queensland

John Shanahan, Samantha Goddard, Simon Dawson and Greg Young.

Samantha Goddard driving the drinks cart.

Wincollect AICM golf day The Wincollect AICM Golf Day was held at Virginia Golf Club on Friday 29 September 2017. It was a hot Friday afternoon. The course was firm and fast. The winning team was from DSS Law with second place going to the team from SM Solvency Accountants. The NAGA Award went to the Wincollect 1 team. Nearest the pins were won by Gary Forrest, Johan Steyn, and the straightest drive Mens was won by Matt Hudson and the Ladies by Shireen Long. We acknowledge the supporters of the day being Wincollect, Creditor watch, SM Solvency Accountants, Forbes Dowling Lawyers, DSS Law and Equifax. This year our supported charity was the Cancer Council Queensland. We raised $440.00. Thanks to all who participated and I look forward to seeing you next year. – Greg Young, Chair Queensland Golf Day Organising Committee

The history of Credit Education in the Queensland Division BY DONALD J. FENWICK FICM I joined the Institute in 1997 and joined the State Council in 1980. In 1983 I was given the Education and other activities portfolio. 1984 Bill Duncan who had started the TAFE Credit Management Course at Kangaroo Point moved to Sydney to start another business, this left us without a lecturer. Howard Goodall, a councillor took over this role, however within 3 months he also moved to Sydney to take up a new role in Credit Management. So I took over the course and finished the year. However it was very difficult as we were left with a minimal outline of the course and minimal course notes. 66

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Matthew Hudson (SV Partners), Shireen Long (DSS Law), David Chen (DSS Law), and Alicia Odenthal (Pilot Partners).

So over the Christmas break I took it upon myself to create a detailed curriculum for the following year, which after Council approval was presented to the Study Area Co-ordinator of Kangaroo Point TAFE and it was also approved by them. I then took on the task of research and development of course lecture notes and notes for the students. In 1986 The Queensland Department of Education decided that all Industry Specialist Teachers had to have attained an accreditation in Instructional Skills to be able to teach within the TAFE system. About twenty of the current Specialist Industry Trainers commenced the course of 13 subjects. zz The role of the instructor. zz The Teacher and the adult learner. zz The Teacher and the adolescent learner. Writing lesson objectives. zz Lesson planning and presentation. zz Student assessment and program evaluation. Program development. zz Program interpretation and implementation. Teaching strategies. zz Practical Teaching skills. Video techniques. zz Projection techniques. Visual display techniques.

Queensland

In October 1987 we were presented with our statement of attainment and were allowed to continue our teaching, however with all this under my belt I believed we could improve our one year course to two years with an advanced credit management course. Council agreed and with the help of other councillors we structured an advanced credit management course which was approved by TAFE and introduced in 1989. Graham Vickers joined me on the teaching team and took over the first year of Credit Control Procedures and Advanced Credit Control Procedures while I took on the Credit Management and Advanced Credit Management subjects. TAFE also allowed the subject to become electives of the Associate Diploma in Business which I believe was a first in Australia. In 1993 I was appointed consultant lecturer at the Ithaca TAFE Training Centre and conducted short courses there. Between 1993 and 1995 I was invited to present the same course at the Darling Downs TAFE and the TAFE College Gympie. News got around and I was then invited by the South Australian Division to present courses in Darwin. In June 1993 Australian United Foods, (Peters & Pauls Icecream) ceased its operation in Queensland which meant I was out of Credit Management as an occupation so I turned to the training aspect and continued with my teaching at Kangaroo Point. In 1994 I completed the professional education course “Interactive Teaching Strategies.” I also attended the “Competent Trainer Course” through Next Training and in the same year the Queensland Division certified me as an Accredited Trainer of the Division. In 1994 Marion Hintz and I registered a company Maridon Pty Ltd trading as Maridon Training Consultants and worked for the Institute in presenting short term credit management courses in Cairns, Townsville, Lismore and Brisbane. In 1996 the National Council was arranging a meeting in Melbourne to plan what was to become the Certified Credit Executive program. Being the current College lecturer and the Certified Trainer for the Division and with over ten years handson experience in education I expected to be Queensland’s representative but the powers to be did not agree and Marion Hintz was chosen to represent Queensland. 1997 saw Maridon Training Consultants closed and at the

Creditorwatch team - Johan Steyn, Oliver Sherlock, Joshua Mann, and Ryan Booker.

end of the year gave up my teaching role. I do not regret the effort I put into Credit Management education and as I reread the article I wrote on education in the 1988 Bicentennial Edition of Queensland Credit much of what I was saying and predicting has come to pass, so I am proud to have been a small part in this great area of success for the Australian Institute of Management.

The Australian Institute of Credit Management welcomes our Partners for 2017. National Partners

Divisional Partners

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.

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

Brendan Nixon (SM Solvency Accountants), Craig Pease, Jos Basson (CLH Lawyers), Nathan Shaw (McPherson Chambers).

AROUND THE STATES

South Australia

Marcelle McEwan of Kemps Credit Solutions and James Neate, Australian President at the S.A. Network evening.

John Antoniadis (CCE Recertification), Ericson Malvar (new CCE) and Ratibor Mirkovic (new CCE), all of NCI, receive their certificates from CCE Director Trevor Goodwin.

President’s Report

I would like to wish every state a wonderful Christmas and a safe and Happy New Year. Take care over the festive season and I look forward to catching up in 2018.

We are now into the Festive Season! I feel like it commenced at the beginning of November this year! It is getting earlier and earlier as I feel myself getting older and older, trying to keep up with the bustle of this crazy season. In saying this, it is a wonderful time to catch up with our members, past and present, and share the vast knowledge between all of us whilst discussing the events of the year, and what lies ahead for 2018. Canberra was certainly the right place for the commemoration of our 50 years. The QT was a great venue offering high quality facilities. All attendees from South Australia found Canberra offered more than they anticipated and spoke of how they enjoyed the quantity and quality of the conference. I speak on behalf of our SA members in saying well done to our national office. We have since held several events, including a toolbox session on Collect with Confidence. This was an enlightening re-cap on policies and procedures that we sometimes tend to neglect and forget. It was well received and will be followed by part 2 in the new year. Our last networking/50 year event was a real buzz. Past and present members and credit professionals attended. We were very pleased to have such a good turn out and look forward to putting more of these together over the years ahead. Our councillors continue to seek feedback from our members and non members on our event content. Please contact us and give any suggestions you may have. We are here for you and insist that you are a part of everything we do throughout the year. This is also a chance for me to thank our local partners: Worrells, BRI Ferrier and Kemps Credit Solutions. We really appreciate your input throughout the year. Your continual support in attending functions and offering your services is important. Thank you to our wonderful Councillors. All your time and effort throughout the year does not go unnoticed and you keep me motivated! We are lucky to have such a brainstorming team that continue to juggle work, family and the AICM …. Also, thank you to our national office for your patience. Your gentle reminders are necessary and you do it well. 68

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

– Gail Crowder SA Division President

Breakfast with Nick Xenophon Adelaide Convention Centre offered the AICM a great venue for breakfast followed by 3 high calibre speakers for a half day symposium on 21 September. What a great start to the day with a hearty meal, fruit, muesli and the beverages to accompany. Our speaker was none other than Mr X or The X Factor Senator Nick Xenophon. Before the event began, Senator Xenophon managed to spread himself around to each table to find out where people worked! By the time he began his speech he was relating it to our individual business sectors. He then continued to explain the impact his actions and beliefs may/or may not have in the future. The topics that were discussed ranged from overseas to local issues. He started with his citizenship issues that are currently before the High Court. He believes he has a 50-50 chance and jokingly said that this could be his last speech! Of course we all hope that this is not the case as Senator Xenophon continues to do so much for SA. Issues like the level of volatility in the world and how Francois Hollande became president just in 12 months to “Rocket Man” Kim Jong Un and his missiles and then to Donald Trump who is becoming “unhinged”. We also cannot forget the climate and the devastation that is also having on the economy. We have uncertain times ahead and believe this will have a 1020% impact on our economy. Locally, Australia has the most expensive energy prices in the world. Implications to South Australia is that companies will close or go offshore as they can no longer afford to be here. In his opinion, we have made a complete mess of our energy policy. Regarding the Safe Harbour and Ipso Facto insolvency law reforms, Nick spoke to us about the changes that may affect us in regards to Directors liability in liquidations or insolvency. Just some different facts that Senator Xenophon mentioned, we have fewer 18-34 year old’s than in 1982. Sportsbet you

South Australia

Charlie Degabriele and other attendees enjoying the Network night at the Cathedral Hotel.

can place a bet on who will have the first blackout in Australia. I believe SA is the front runner on this. FOS was too restricted and needed to change. We are over governed in this country. State Governments need to work harder and in the future, we will have more hung parliaments. What an informative way to start the day! Senator Xenophon certainly showed how knowledgeable and interactive he is with the public.

Collect with Confidence Part One

– Anne Wilkins FICM CCE Vice President SA AICM Council

AROUND THE STATES

Gail Crowder, S.A. President and Karen Goodwin of Toro Australia at the recent Network night.

This educational event was professionally presented by Suzi O’Connor, Pacific Credit Manager, Pernod Ricard Winemakers P/L. Once again, the Hindmarsh Education Development Centre was the perfect venue and catered well with tea, coffee and morning tea goodies. The room was well set up with a U shape seating arrangement which lean’s to a more interactive audience. Aimed at entry-middle level credit professionals it was clear to see that the presentation was graduating to a higher level. The experience within the audience created a lot of interaction

Functions Report Our final social function for the year was a networking night held at the Cathedral Hotel, North Adelaide on Thursday 23rd November. This stylish venue has a lovely view over the city skyline and particularly accentuates the magnificent Adelaide Oval and North Adelaide Cathedral. The venue was a perfect size for our event and the food was enjoyed by all of the members and their colleagues. Approximately 35 people attended this most enjoyable evening which consisted with a good mixture of members, associates and past members for our final event celebrating the 50th year of incorporation. It was great to see so many past members who have contributed so much to the Institute over the years. A great deal of reminiscing occurred throughout the evening and everyone was excited about catching up in a social environment over a drink and finger food. Gail Crowder and Trevor Goodwin thanked everyone for attending and reflected on the busy 2017 year, and the exciting year to come. The Functions Committee is already busy planning the calendar for 2018. This will include looking at venues and organising events that will be interesting and entertaining for our members and their colleagues. During the year we will be holding functions including: the networking evenings, Annual Awards night, Quiz night and any other functions requested by our members. – Trevor Goodwin, Functions

The Australian Institute of Credit Management welcomes our Partners for 2017. National Partners

Divisional Partners

Official Division Supporting Sponsors

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

South Australia

Victoria/Tasmania

Attendees at Toolbox training.

Getting Warmed Up for the Singing Bee.

President’s Report

Toolbox Trainer Suzi O’Connor.

with many questions and ‘in practice’ stories being told. It was good to see that everyone was willing to interact and share their knowledge. Suzi showed her passion for training and presenting by engaging the audience and encouraging note taking, which was evident from the less experienced credit staff. Being aware of the legislations is imperative, but not always mentioned. This session enlightened the importance of knowing these before making a call for collection of an account. Whether you are speaking with an individual or a company, you need to be the one creditor that is at the top of their list to pay. Suzi explained that you need to befriend them, in a professional manner, controlling the call at all times. You are looking for a result which is: payment in full or a plan that will clear the debt as quickly as possible. Suzi showed that if you have a difficult call, standing up or walking around the room helps you take control of the call and enables you to think more clearly about the conversation taking place. This was part 1 of the toolbox and only a small section of the tips discussed. Part 2 will be in February 2018 so look out for the date on the AICM website calendar and lock this in your diary! Continue to ‘Collect with Confidence’! – Gail Crowder 70

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Firstly, I would like to thank the Victorian state Councillors for their commitment and help during the year they are the back bone of the Vic/Tas council, the AICM National office, thank you for your help and assistances they are the quiet achievers, that just get the job done. To all our members the journey we are on with AICM is just getting bigger and better, the memberships has increased again. It is great to see so many new faces attending our events during the year and look forward in seeing all our members at next year’s network and events. We have great opportunities to grow our membership further in 2018 with some new great initiatives. To the great speakers and presenters thank you for your time, knowledge, wisdom and the energy you bring to our sessions, it is very much appreciated. To our National Partners Equifax, illion, Austral Mercantile and Bureau Van Dijk and our State Partners AMPAC, Sharp & Carter and On Guard. I also thank our Professional Partner Ashurst and NCI and GSA as our divisional supporting partners. Thank you for support and contribution over the last 12 months, looking forward to a bigger and better year in 2018. Wishing everyone a happy and enjoyable festive season and no doubt a well-deserved break over the holiday period and a very happy and prospers New Year. – Lou Caldararo Vic/Tas State President

AICM’s Toolbox Series again a winner with Credit Professionals! Vic/Tas Council has successfully delivered the first two (2) Modules of the AICM Credit Toolbox Series in the second round of presenting this training for 2017. Toolbox 1 (Fundamentals of Credit) was conducted on 24 October 2017 by Jeff Hurst from Trade Bureau, with approximately 6 participants in attendance. Toolbox 1 covers Legislation Overview, Legal Entities, Procedures, 5 C’s of credit, and Warning signs. Toolbox 2 (Collect with Confidence) was conducted on 10 November 2017 by Donna Smith of Reliance Recoveries with 3 participants in attendance. Toolbox 2 covers

Victoria/Tasmania

Making the call, Documentation, Securities, Risk) When, Why and How to make a call, Difficult Debtors and Best practice for all call types. Feedback is very positive for this ongoing education aimed at those who want a general understanding the whole credit picture. The sessions are fun, informative and interactive encouraging students to ask questions during the presentation to get the most from their studies. Toolbox 3 (Understanding Credit) covers What is Risk Management, Areas of Risk, Assessing the Risk, Fundamentals of Managing Risk, and Managing the Risk. The sessions will be held at QBE Buildings on 6 December 2017. A very special thanks to Catrina Galanti for donating her time and every arranging access to the facilities and to QBE for generously donating their training room facilities at 628 Bourke Street for the training. We really appreciate the ongoing support you provide the AICM. For those interested in the Toolbox series register your interest with AICM National Office, and just so you know, the AICM offers a variety of other courses both face-to-face and online for those interested in further educating themselves in the changing realm of credit. Go to the AICM website for information on upcoming events and courses http://aicm.com.au/courses/.

Trivia Night a Roaring Success On the 26 October 2017 approximately 70 members and guests attended the 2nd Annual Trivia Night at the Royal Melbourne Hotel. A lovely venue, built in 1889 and located on the former site of Melbourne’s Bourke Street-West Police Station, RMH incorporates historical features & modern architecture culminating into one of Melbourne’s most iconic entertainment & dining venues. The food and beverage service was excellent. As the flyer said, there is nothing like a cheerful pub trivia session to help stave off any mid-week boredom, and this event certainly did not disappoint. There was lots of friendly competition and healthy ribbing and it was a great way to catch up with our Industry compatriots. A great time was had by all. Again hosted by former Victorian Councilor Neil Smith and our Grand Quiz Master, he did not let us down with his high

Eduardo Perez (Interactive IT) presents on Cyber Security.

Gabriella Forte, Daniel Sutherland, Lou Caldararo and Frank Fisher.

standard of questions again this year. Neil demonstrated his passion for all things volcano and his penchant for unusual pop culture questions, there were certainly some doozies in there. RecoveriesCorp took out the grand prize ahead of some close competition from Team Austral coming in second by only 1 point. A huge thank you to the Vic/Tas Committee Members, Catrina Galanti (QBE Insurance) and Amaran Navaratnam (REA Group) for organising this event. It takes a great deal of time and effort to organise these events and without the dedication and application of our committee members volunteering their time and energy, events like these would be impossible.

CCE Event & Presentation – Cyber Security – Sponsored by Interactive IT Eduardo Perez, who is the Head of Cyber Security at Interactive Pty Ltd, Australia’s largest privately-owned IT company, stood before 15 CCE’s and delivered a lively and informative presentation on Cyber Security. The essence of Eduardo’s presentation was that Cybersecurity is an issue for all business professionals. Credit Professionals are custodians of not only one of the organisations largest financial assets but also one of the company’s most valuable information and business critical December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

President Lou Caldararo presents CCE Dux Gerrad Harper (CGU) with his award.

AROUND THE STATES

Victoria/Tasmania systems. This makes Cybersecurity a must know topic for all credit managers. Participants enjoyed the open discussions about breach, phishing, and other cyber security risks, as well as recent cyber threats that have occurred in Australia and around the globe. Congratulations to all the newly appointed CCE’s, Gabriella Forte and Frank Fisher from Australia Post, and Daniel Sutherland, who were presented with their certificates at the breakfast. Well done all for your participation and achievement. A super huge congratulations goes to Gerrad Harper, Credit and Legal Manager at CGU Insurance, who took out the national prize for highest achievement in CCE, emerging the Dux of 2017. What an achievement Gerrad! You are a credit to yourself, CGU, your state and the industry. Thank you for participating and bringing us your best. On behalf of all the members and guests I want to extend a huge thank you to Interactive IT for donating the fabulous warm breakfast, fruit and barista made coffees and their modern facilities. Thank you to Eduardo for donating his time and expertise and to Sherif Hussein (Billing & Credit Manager, Interactive) for organising the event. – Mary Petreski (Credit Manager – Commercial Team at Workwear Group)

Meet Stephen Maloney of AMPAC Debt Recovery – Sponsor in the Spotlight Without our State Sponsors many of the events that the AICM hosts would not be possible. Therefore we would like to take the opportunity to highlight and thank AMPAC Debt Recovery for their continued support of the AICM, by introducing you to Stephen Moloney, Director of AMPAC. Stephen is a long term member of the AICM, and he is really proud of AMPAC’s continued growth on the back of unique debtor engagement technology and resources. Stephen has been a Director of APMAC for 5 ½ years. He’s married to Lynn with 2 grown sons who are 29 and 27. Stephen loves his golf, and watching local footy. He’s also a keen table tennis player, surfer and is generally into fitness. Foo Fighters are his current favourite band; however he did confess that he grew up on and still loves AC/DC. When it comes to movies, Life of Brian is an old favourite of his, and Peaky Blinders and Vikings are shows he likes to binge watch on Netflix. Stephen says he is AFL all the way, his dad brainwashing him from a young age, and him growing up idolizing all the Carlton stars. He says he has been quietly supporting them of late because they haven’t been doing so great, but he is still devoted. Check out the accompanying photo of Stephen. You should notice that he is sporting a rather snazzy pair of golf pants. He said that his wife bought him those crackers, so once a year he wears his “happy pants” to stir up the lads, lighten the mood and become and easy target for ridicule. When you next see Stephen at an event please go up and introduce yourself. He is more than happy to talk to you about the Foo Fighters, golf or his happy pants or perhaps something else you might have in common with him. Thanks Stephen for sharing all that wonderful and interesting information. 72

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Stephen Moloney in his Happy Pants.

The Australian Institute of Credit Management welcomes our Partners for 2017. National Partners

Divisional Partners

Professional Partners

Official Division Supporting Sponsors

Western Australia/NT

President’s report Change is slow in the credit world – we all still want to be paid for services rendered. The market continues to tighten and purse strings follow along. Lucky for us, the way we get paid is going to change, with instant payments going to be just that ‘instant’. One day in the near future, we will all be wondering how we ever survived having to wait 24-48 hours for payments between banks to arrive. Until this becomes part of everyday accepted practice, we will have to be patient. This change should relive cash-flow and improve KPI’s for those that way inclined. As the year unfolded our rights, obligations and the way we interacted with insolvency professionals changed for the better. The changes improved creditor’s ability to obtain information and influence the approach taken in an administration. These alterations to process and regulation are certainly a highlight. The decision to celebrate the AICM’s 50th Anniversary in Canberra proved to be an inspired choice. The National Conference continues to be well supported by Western Australia. Delegates from AHG, Bunnings, BGC, Equifax, QBE, MGL, Veolia and Wesfarmers confirmed another successful program was delivered. Although we were well represented at the YCPA by Peter Hamers we were unable to take away the chocolates on the day. The WA Council take this opportunity to congratulate Nick Pilavidis and his team for another well put together event that demonstrates what the AICM is all about today and into the future. The WA Credit Community closed 2017 with our traditional festivities in the marquee at the South Perth Yacht Club with a twist. The WA Council hosted the Pinnacle Awards sponsored by Austral on 7th December. We especially thank Damian Romano and Nick Pilavidis for being available to join us in celebrating the evening with WA Members. The City of Perth at night is truly an amazing backdrop for any event. We are very lucky to have her lights shine on our winners. Looking forward to seeing all of our members in 2018. Lisa Marr, WA State President

WA Division State President Lisa Marr welcomes attendees to the October breakfast.

Reflection on 2017 in WA Out first event of the year was the Barefoot Bowls competition held at Leederville Bowls Club. The team from Ferrier Hodgson took the honours this year. In March we held the economic update which was presented by Alan Langford, the Chief Economist at Bankwest. Alan covered topics ranging from the state election and the implications that has on the economy, as well as the election of Donald Trump as President of the USA and what that might mean for Australia. In June we had the Women in Credit Event held at the Crown Perth. Mia Davies, leader of the WA Nationals, was the main speaker. In July we held the YCPA gala dinner at Burswood. It was a great night with strong competition for the gong, which went to Peter Hamers of Wesfarmers Kleenheat. Our presenter for the breakfast presentation in August was Cynthia Thomas of Austral Mercantile, speaking on Effective Credit Management in a changing society.

The Australian Institute of Credit Management welcomes our Partners for 2017. National Partners

Divisional Partners

Official Division Supporting Sponsors

October Breakfast meeting The final WA Credit Community breakfast of the year was held on 18 October at the Matilda Bay restaurant on the Swan River. Nathan Stubing from FTI Consulting presented on the recent changes to the insolvency legislation and their impact on credit practitioners. It was a very relevant presentation that was well received and the location, as always, is spectacular!

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

Nathan Stubing addresses the October breakfast meeting.

AROUND THE STATES

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

Australian Capital Territory

Tasmania

Adam Cutri Anthony Lane

Dana Choy Sam Watson

Bartier Perry Vincents Chartered Accountants

Vodafone Hutchinson Australia Pty Ltd Vodafone Hutchinson Australia Pty Ltd

New South Wales

Victoria

Helen Anderson AHG Danielle Bajzak AHG Jane Billinghurst AHG James Blake Forbes Dowling Lawyers Pty Ltd Faraz-Ul-Hassan Bugvi AHG Dianne Curtis-Oates Sanofi-Aventis Australia Pty Ltd Anna Darroch - Dobbie Turks Legal Damon Fletcher Credit Industriel et Commercial (CIC) Zenab Fouane Vodafone Pty Ltd Mark Glynn Bartier Perry Janelle Green Simplot Australia Pty Ltd Ganga Gurung Hilti (Aust) Pty Ltd Samantha Guthrie Hilti (Aust) Pty Ltd Monique Hardy AHG Christine Higgins AHG Tara Horgan Equifax Rupinder Hosking Aristocrat Technologies Australia Pty Ltd Stephen Ke Bartier Perry Lawyers Bronwyn Knopp AHG KC Lim Credit Industriel et Commercial (CIC) Amanda Logan-Halaj Austral (QBE) Deon Maritz Aristocrat Technologies Australia Pty Ltd Fiona Mifsud Aristocrat Technologies Australia Pty Ltd Mansi Nangru Aristocrat Technologies Australia Pty Ltd Agnieszka Olszanowska AHG Edna Otto Manpower Group Shirjana Rai Hilit (Aust) Pty Ltd Jesusita Roach Aristocrat Technologies Australia Pty Ltd Anthony Ryan Zodiac Group Australia Pty Ltd Crishelle Sanchez AHG Tarun Sharma Vodafone Hutchinson Australia Pty Ltd Kerry Smith AHG George Tokitsis Toll Holdings Anna Ngoc Kien Truong Omnicom Media Group Australia Hon Sang Yap Hilti (Aust) Pty Ltd Emme Meme Yap Aristocrat Technology Australia Pty Ltd Snezana Zappia AHG Mohammed Zawed Mitsubishi Electric Australia Pty Ltd

Anoop Agarwal Darren Behan Rachel Belej Peter (Tuck) Chong Justin Coates Lisa Dahl Gehan Dedigama Ozkan Dilek Michelle d’Offay Jason Dowling Melissa Doyle Kerrie Ellis Nicole Flynn Andrea Forryan Jasmine Geurens Alyssa Gutierrez Clifford Heri Nana Kawase Anastasia Khayrets Stergoula Klementou David Laing-Short Michael Later Weiming Li Jason Lim Nitin Malik Katrina McComb Aneil Pancha Verity Ranieri Clifford Row Janet Shahine Troy Sherry Brian Siew Jatendar Singh Tab Uddin Patrick Viguet Jennifer Wallace Raymond Wilson Jane Zhao

Queensland

Western Australia

Karen Louise Clarkson Michelle Ann Kirkby Kristen Launt Denica Saunders Aleisha Weber

Iplex Pipelines Pty Ltd ERM Power Bulk Fuel Australia Pty Ltd Collection House Limited The Stoddart Group

South Australia Ross Fedele Julie-Ann Field Vincenzo Fragomeni Daniel Harris Kelly Maree Memmler Renee Muschiol David Nichol Vivienne Pearson Susan Saunders Kylie Speck Daniel Tandler 74

Group Management Services Group Management Services CCC Financial Solutions Pty Ltd NCI (Brokers) Pty Ltd Elders Rural Services Australia Limited Group Management Services Austral Mercantile Collections Pty Ltd Group Management Services Group Management Services Group Management Services EMT Legal

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

Melanie de Jager Malcolm Field Edwina Reed Nicole Rogers Damian Romano Candice Sharp Wanda Spencer

EFM Logistics realestate.com.au Visy Credit Services BMW Financial Services BMW Financial Services Simplot Australia Pty Ltd BP Australia Pty Ltd Porta Mouldings Pty Ltd BMW Financial Services Collection House Limited Simplot Australia Pty Ltd SBD Simplot Australia Pty Ltd Simplot Australia Pty Ltd EFM Logistics IODM Limited BMW Financial Services BMW Financial Services BASF Australia Ltd Dynamic Supplies Pty Ltd IODM Limited BMW Financial Services Bank of Queensland Viva Energy Australia Pty Ltd BMW Financial Services illion Austral Mercantile Collections Adidas Australia Pty Ltd Kemps Petersons Receivables Management Cummins South Pacific Pty Ltd Austral Mercantile BMW Financial Services Gale Pacific Ltd EFM Logistics Stramit Building Products Stramit Building Products National Credit Management Limited EFM Logistics

Capricorn Society Ltd SV Partners Brickworks Building Products Kleenheat Gas Austral Lumen Christi College BGC Australia

Overseas Emily Henry Hannah Henry Serena Hindt Mandy Lavery Matthew Ling Valmae Panui Melody Pope Darrell Horton

Fletcher Building Fletcher Building Group Shared Services Fletcher Building Ltd Fletcher Building Limited Fletcher Building Group Fletcher Building Group Fletcher Building Group Aristocrat Technologies

AICM Marketplace Directory of services For information, options and pricing please contact Andrew Le Marchant on +61 2 8317 5052 or E: andrew@aicm.com.au COLLECTIONS AICM Divisional Partner

AMPAC Debt Recovery Level 5, 35 Clarence Street Sydney NSW 2000 Tel: 1300 426 722 Email: info@4ampac.com.au Web: www.4ampac.com.au Trust AMPAC, we guarantee to give you the right advice…… AMPAC provides a complete range of debt recovery and receivables management services to big business, government and thousands of SME’s nationally, so next time you are deciding how to deal with that difficult customer, pick up the phone and call us. We are ready to help you too.

DEBT COLLECTION

INFORMATION

AICM National Partner

Austral Payment Management Services Tel: 1300 422 665 Email: info@australmercantile.com.au Web: www.australmercantile.com.au Austral provides complete credit management services and works closely with our clients to understand their business and provide the solutions they require. Our experienced team works hard to deliver a consistently good experience and are always looking for ways to improve processes to help ensure your business has a continuous cash flow. So while we work on helping your debtors stay in the black, you can focus on what you do best and grow your business with confidence.

AICM National Partner

illion Tel: 13 23 33 Web: www.dnb.com.au Dun & Bradstreet has changed. We are now illion. Bringing data, analytics and insights to life is at the heart of what we do, and we will continue to break new ground in the product development and innovation space. Our commercial and consumer databases enable Australian businesses and consumers to make informed decisions, based on real time data drawn from an extensive range of sources. We remain a reliable and trusted partner to a wide range of global organisations, who use our solutions for credit reporting, risk management, sales and marketing and receivables management.

COLLECTION SYSTEMS AICM Divisional Partner

Kemps Credit Solutions OnGuard Tel: 1800 123 613 Web: www.onguard.com OnGuard’s Credit management solution will help you hit your collection targets – each and every month. By working smarter and providing better visibility, OnGuard will help you reduce your DSOs. Why not give your staff a friendly solution that will make their life so much easier. Contact us to show you how OnGuard has made life a whole lot easier for our customers.

CONSULTANCY

50 Grenfell Street Adelaide 5000 Tel: 08 8418 1450 Email: gcrowder@kemps.com.au Web: www.creditsolutions.net.au/kemps Kemps Credit Solutions. A debt collection partner you can trust. Working with some of the country’s leading providers of information management and data intelligence solutions. Since 1965 Kemps Credit Solutions has set the benchmark for providing quality collection and recovery services to South Australian businesses and government.

DEBT PURCHASING

EDX Tel: 03 9028 8278 Email: enquiries@edxppsr.com.au Web: www.edxppsr.com.au EDX is the market leader in PPSA consultancy and registration, with over 15 years’ experience in Australia and New Zealand. We have helped hundreds of Australian businesses adjust to the PPSA by providing no-nonsense practical advice, coupled with first class PPSR registration capability and registry management. Whether you have high volumes and need a software solution or simply wish to outsource, EDX has a solution to meet your needs.

AICM National Partner

AICM Divisional Partner

Debt Sale Brokers Australia Tel: 1300 896 122 Email: adam@dsba.com.au Web: www.dsba.com.au Debt Sale Brokers Australia represents credit issuers across banking/finance, utilities, telecommunications, trade credit and mercantile agents with services to maximise returns on non performing debt ledgers. Contact Adam Dayien to find out more on how you can turn your non performing debts into cash.

AICM MARKETPLACE

Equifax Tel: 13 83 32 Web: www.equifax.com.au Equifax powers the financial future of individuals and organisations around the world. Using the combined strength of unique trusted data, technology and innovative analytics, Equifax helps its customers make informed decisions. Headquartered in Atlanta, Ga., Equifax operates or has investments in 24 countries in North, Central and South America, Europe and more recently in the Asia Pacific region, with the acquisition of Veda, a data analytics company and the leading provider of credit information and analysis in Australia and New Zealand.

AICM Marketplace – our new initiative Welcome to our new marketplace. We’re proud of the AICM and we want to let all credit professionals know those businesses that support the AICM. Thank you to these companies for their continued support and please consider them first when you’re looking for assistance in your business. We’ll also include these sponsors on our website so you can be sure to find them easily. For more information contact:

Andrew Le Marchant Direct: +61 2 8317 5052 Email: andrew@aicm.com.au Tel: 1300 560 996

December 2017 • CREDIT MANAGEMENT IN AUSTRALIA

AICM Marketplace Directory of services For information, options and pricing please contact Andrew Le Marchant on +61 2 8317 5052 or E: andrew@aicm.com.au INFORMATION

INSOLVENCY

AICM Divisional Partner

Trade Bureaux Australia

AICM Divisional Partner

Worrells

PO Box 473, South Morang VIC 3355 Tel: 03 9303 8900 Email: tba@bigpond.net.au Web: www.tba.net.au

FTI Consulting

Trade Bureaux Australia P/L provides secretarial and chairperson facilities for Industry Credit groups within Australia. Operating since March 1998 we are independent and cater for over 25% of the Australian Credit Bureaux market. Our members work together to strengthen their credit knowledge and reduce their company’s investment in working capital and bad debts. Contact Jeff Hurst to find out about forming or joining one of our industry groups.

FTI Consulting is an independent global business advisory firm dedicated to helping organisations manage change, mitigate risk and resolve disputes: financial, legal, operational, political & regulatory, reputational and transactional. Collectively, FTI Consulting offers a comprehensive suite of services designed to assist clients across the business cycle – from proactive risk management to the ability to respond rapidly to unexpected events and dynamic environments.

Tel: 08 9321 8533 Web: www.fticonsulting.com

INSOLVENCY

Suite 1103, Level 11, 147 Pirie Street Adelaide SA 5000 Tel: 08 8214 0500 Email: adelaide@worrells.net.au Web: www.worrells.com.au Worrells is dedicated to solvency management, insolvency administration and forensic investigation. Worrells have been providing high quality corporate and personal insolvency services for over 40 years. We pride ourselves on offering reliable and practical solutions to those burdened with debt. With 24 partners and over 100 staff in 26 locations across Australia we are resourced nationally but focussed locally.

LEGAL

AICM Divisional Partner

Insolvency Intel BRI Ferrier Adelaide Level 4, 12 Pirie Street Adelaide SA 5000 GPO Box 952, Adelaide SA 5001 Tel: 08 8233 9900 Fax: 08 8211 6644 Web: www.briferrier.com.au BRI Ferrier Adelaide provides recovery, insolvency, advisory and forensic accounting services to businesses throughout South Australia and beyond. We have a wealth of in-house technical expertise as well as the support of our specialist professionals from BRI Ferrier’s unrivalled national and international network.

Tel: 1300 265 753 Web: www.insolvencyintel.com.au Email: answers@insolvencyintel.com.au Insolvency Intel: a subscription-only provider of insolvency and turnaround services for credit managers. Backed by national firm Jirsch Sutherland, our friendly team is just a phone call or email away, providing members with practical, strategic advice about corporate and personal insolvency. Free initial consultation; networking opportunities; training and presentations; knowledge database access; regular newsletters. Register now for a free subscription.

AICM Divisional Partner

Results Legal Level 4, 183 North Quay Brisbane QLD 4000 Tel: 1300 757 534 Web: www.resultslegal.com.au Results Legal is a national firm with a focus on promoting and protecting the rights of trade creditors. Our clients are some of Australia’s largest trade credit companies who rely on our assistance for legal recovery, dispute resolution, preference claim defence and PPSA rights. Results Legal are the obvious first choice for companies seeking a national solution to resolve commercial disputes and pursue swift, successful and cost effective legal recovery action.

AICM Divisional Partner

Ferrier Hodgson Level 28, 108 St George’s Terrace Perth WA 6000 Tel: 08 9214 1444 Email: perth@fh.com.au Web: www.fh.com.au As a leading independent financial advisory and restructuring provider, Ferrier Hodgson solves complex problems with commercial solutions.

Vincents

TurksLegal

Level 34 Santos Place, 32 Turbot Street Brisbane QLD 4000 Tel: 1300 VINCENTS (07) 3228 4000 Web: www.vincents.com.au

Tel: 02 8257 5700 Web: www.turkslegal.com.au Contact: Daniel Turk

We live in a world of increasing complexities; the need for true expert advice is now more evident than ever. Established for more than 25 years Vincents is an Australian firm of accounting experts and business advisers specialising in assurance & risk advisory, business advisory, corporate advisory, financial advisory, forensic services, and insolvency & reconstruction. Gain insight and take control with Vincents.

CREDIT MANAGEMENT IN AUSTRALIA • December 2017

TurksLegal is a specialist commercial law firm with 33 Partners and over 160 staff across our Sydney, Melbourne and Brisbane offices. We are proud to look after the interests of trade creditor suppliers and financial institutions in: l Portfolio debt recovery using our market-leading, real-time client interface, ‘TurksFocus’ l Resolution of complex debt disputes l PPSA recovery l Defence of unfair preference claims l Supply documentation and guarantees.

AICM MARKETPLACE

AICM Marketplace Directory of services For information, options and pricing please contact Andrew Le Marchant on +61 2 8317 5052 or E: andrew@aicm.com.au RECRUITMENT

TECHNOLOGY

TRADE CREDIT INSURANCE

AICM Divisional Partner

National Supporting Sponsor

Sharp & Carter

CreditSoft Solutions

Web: www.sharpandcarter.com.au For any assistance with Credit recruitment, please call Melbourne – Chris Belegrinos on 03 9616 2622 Email: cbelegrinos@sharpandcarter.com.au Sydney – Janine Coppeller on 02 8315 8804 Email: jcoppeller@sharpandcarter.com.au Sharp & Carter will tailor candidate sourcing strategies to suit your company’s needs, taking into account factors such as time frame, budget, level of role and availability of candidates in the market. We are committed to achieving a successful outcome for every assignment on which we work.

Tel: 1300 720 164 Email: info@creditsoft.com.au Web: www.creditsoft.com.au

National Credit Insurance Brokers

CreditSoft specialises in providing credit managers with innovative products that will save your business significant operating costs and allow you to manage your time and resources more efficiently. We offer contact, tracing, payment, reporting and analytic solutions that redefine the way credit departments operate. Our goal is to ensure you achieve the best possible return on your investment.

National Credit Insurance Brokers (NCI) has established itself as the premier trade credit insurance broker in Australia, New Zealand and Singapore. Trade credit insurance is a highly specialised area of insurance and, with its 30 years of experience, National Credit Insurance Brokers has developed an unmatched depth of expertise in arranging the right protection at the best price for your particular trading needs.

Tel: 1800 882 820 (freecall) Email: info@nci.com.au Web: www.nci.com.au

LET’S GIVE CREDIT TO GREAT WOMEN IN OUR INDUSTRY

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