Credit Management in Australia - October 2015 by AICM

Volume 23, No 1 October 2015

IN AUSTRALIA

The Publication for Credit and Financial Professionals

2015

Annual Conference Find out the latest on:

 Human Resources  Credit Management  Technology  Training news

2015 National Conference

Check our website ... www.aicm.com.au

DIRECTORS Australian President – G.L. Morris MICM CCE Australian VP, Legal Affairs – J.A. Neate MICM Professional Development – S.D. Mitchinson LICM YCPA & CCE – G.C. Young MICM CCE Member Services – J.G. Hurst FICM CCE Finance – G. Odlum MICM CCE

NSW Division: Young Credit Professional Award Dinner and getting to know your Councillors.

CHIEF EXECUTIVE OFFICER N. Pilavidis MICM CCE Level 1, 619 Pacific Highway, St Leonards NSW 2065 Tel: (02) 9906 4563, Fax: (02) 9906 5686 Email: nick@aicm.com.au EDITOR/PUBLISHER Nick Pilavidis | Email: nick@aicm.com.au

45 Qld Division: Brian Kay and Murray Walter accepting the Marion Hintz Meritorious Service Award 2015 from Brian Kay.

CONTRIBUTING EDITORS Colin Magee NSW Stacey Woodward Qld Gail Crowder SA Warren Meyers WA Donna Smith VIC/TAS ADVERTISING MANAGER Tony Paul | Association Media Tel: 0401 917 799 | Email: tony@associationmedia.com.au EDITING & PRODUCTION Anthea Vandertouw | Ferncliff Productions Tel: 0408 290 440 | Email: ferncliff1@bigpond.com

48 SA Division: Michael Seychell with YCP SA Winner Tate O’Connor from NCML Limited.

PRINTING Pegasus Print Group, Building B, 1A Bessemer Street, Blacktown NSW 2148, Ph: 8822 0600 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 1, 619 Pacific Highway, 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, 2015.

51 Vic/Tas Divisioin: YCPA – President Lou Caldararo with Keynote Speaker Narelle Fraser.

JOIN US ON LINKEDIN

Click Here EDITORIAL CONTRIBUTIONS SHOULD BE SENT TO: The Editor, Level 1, 619 Pacific Highway St Leonards NSW 2065 or Email: nick@aicm.com.au

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

54 WA Division: YCP finalsists.

Volume 23, Number 1 – October 2015 Message From the President

Technology

CEO Report – Year in Review and Year Ahead

Leveraging the future to improve credit and collections – are you a leader or a laggard?

By Steve Mitchinson

Human Resources?

Peak Performance By Linda Murray

Digital B2B payments

By Richard Miller

How to get the most out of networking By Cynthia Thomas

The evolution of banking in Australia

By Amaran Navaratnam

Credit Management Marked improvement in the way Australian companies are managing credit and payment terms

By Chris Little

Veda National Credit Managers’ Survey 2015

By Moses Samaha

Benchmarking – a critically important enabler of improving performance

By Michael Hartman

Can cash flow finance help credit managers get paid on time…

AICM Can we Help?

AICM Training news

2015 and 2016 face to face training calendar Recent graduates and testimonial What is your learning style?

Around the States New South Wales Queensland South Australia

By Ian Smallman

Communicating the old fashioned way By Frank Vredenbregt

Victoria/Tasmania Western Australia/Northern Territory

ATO toughening up

New Members

42 45 48 51 54 57

By Adam Lysle

Don’t get burnt by the Phoenix

ASSOCIATION MEDIA

For Advertising Opportunities

in Credit Management In Australia

By Robyn Erskine and Adrian Hunter

Economic update from Dun & Bradstreet By Darin Milner

Legal No short cuts on standards of evidence By Wojtek Randla

Statutory Demands: Beware of grabbing the tiger by the tail By Bill Andrews

CALL Tony Paul Phone: 0401 917 799

6 Linda Murray

12 Michael Hartman

Bill Andrews

Email: tony@associationmedia.com.au

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From the President

Grant Morris MICM CCE Australian President

elcome to our only hard copy

and information, face to face Professional Development

magazine of the year. Something

sessions will remain the AICMs focus as there are a wealth

we have timed to coincide with our

of benefits that can’t be replicated online.

National Conference in Sydney and

In confirmation of the AICMs expertise we were

something we will issue each year at this time. If you

asked to be an official endorser of the 25th annual Credit

are reading this at the conference then congratulations

Law Conference also held in October. Peter Mills, our

to you as you are part of the largest gathering of credit

Queensland President and resident sage on all things

professionals in Australia. If not then you are missing a

PPSA, presented at the conference. This was a good

great opportunity to grow your knowledge, keep abreast

opportunity to spread our wings and show our support for

of legal changes and network with your peers. Mark your

the advancement and improvement of credit professionals

diary now for next year’s annual conference on the Gold

across the country. We wish the annual Credit Law

Coast from 12th – 14th October 2016.

Conferences every success and am pleased to note that

Some will see a hard copy magazine as a regressive

AICM members attending the conferences can save

step but we hope many will treasure our annual bumper

more than $300 and obtain a 10% discount by using the

print edition and make full use of the many articles and

promotion code AICM10.

reports it contains. It is a handy reference point for your desk or coffee table. Back on the technological front we held our first

In an historic move, AICM has signed an agreement with the UK’s Chartered Institute of Credit Management (CICM) – Europe’s largest professional credit management

webinar in September when we partnered with Dun &

body – to provide its Quality Accreditation (CICMQ) to our

Bradstreet to deliver an Economic Update. It was delivered

members.

by Dr Stephen Koukoulas, or as he is perhaps better known ‘The Kouk’. The Kouk covered China and US markets, expected

Under the agreement, the AICM will be licenced to use the CICM accreditation process, documentation and intellectual property. CICMQ accreditation is formal

sales, retail sales, residential housing pricing and

recognition of an organisation’s commitment to quality,

approvals, wages, employment and the labour market.

continuous improvement and best practice in all things

Importantly he talked about credit growth, interest rates,

credit. To gain accreditation you must successfully

non performing assets, business start ups and failures,

complete an assessment process which includes an initial

cash flow and payment times. The latter has dropped to

appraisal of your submitted documentation, a Discovery

it’s lowest level in more than a decade. If your collection

Assessment and Gap Analysis report followed by the

rates are not improving perhaps you should get yourself

Full Assessment and Report. Those who qualify will have

along to an AICM training course, toolbox or other

access to the same resources currently available to holders

function to sharpen your knowledge and keep up with

of the UK CICM accreditation.

the rest of us. We had over 400 registrations for the

This agreement represents a significant addition to

webinar and I am sure every single one of us were totally

the AICMs initiatives focused at improving the standard

enthralled by The Kouk.

of credit management and achieving recognition for the

We are working to bring you further webinars on a

role the credit function plays within businesses. We look

range of Credit Management topics and hope to make

forward to many Australian credit operations joining

this D&B Economic Update a regular quarterly feature.

the UK companies (many of whom are FTSE top 100’s)

While webinars are an efficient way to access updates

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

currently holding the accreditation and working with these

From the President

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companies and the CICM to further develop the standards

Grant’s Soapbox

of best practice as the credit function continues to evolve.

I haven’t broken the soapbox yet so let’s wheel it out again.

It is pleasing to see companies entering External

We have received a strong response to our request for

Administration of all forms dropped in 2014/2015 by 9%

support of our proposed lobbying of the Attorney-General

to be at the lowest level since the 2007/2008 financial

and ARITA for changes to legislation and practices in

year. This makes 3 years in a row where the failure rate has

zz The recovery of preferential payments and those

declined and we are now 20% below the post GFC peak.

Liquidator recovered funds not being paid in dividends

On the personal insolvency front it was also pleasing to

to unsecured creditors or any class of creditor for that

see the number of Personal Insolvencies of all form fall by 4.2% to also be at the lowest level in more than 7 years. June quarter new business start-ups were at their highest level in many years and with falling insolvencies this should augur well for the future.

matter. zz Should unsecured creditors who are genuinely at arms length be subject to preference claims? zz The 3 year “statute of limitations” on making preference claims is too long and should be shortened

During the year I was subpoenaed to appear as a witness in a case where a company’s General Manager was charged with signing false declarations supporting payment claims to the project principle. Great to see and we will feature more on this in the next magazine. Our two major national Awards are running well with a solid number of high quality candidates entering the Dun

to a year or less. zz Spurious and inflated preference claims from Liquidators ie claiming $700K and settling for $10K. zz Fees charged by Administrators, Liquidators and Receivers & Managers ie specifically annual increases of 5 – 10% and more. These can never have enough support and it is not too

and Bradstreet sponsored Young Credit Professional of

late to register your support by sending Nick (our CEO)

the Year Award and the Veda sponsored Credit Team of

or I an email simply saying you support positive changes

the Year. Both winners will be announced at the national

in these areas. It doesn’t need to be wordy. We are happy

conference in Sydney in October. Good luck to the finalists

with a simple “good onya”. The emails/links are grant.

who are

morris@coateshire.com.au and nick@aicm.com.au. I hope we see you at the AICM conference in Sydney

YCPA Division Finalists

in October and if not I hope to see you at an AICM event

NSW – Kimberley Hale, from Baycorp

soon as you support the Institute which supports you.

Qld – Michael McDowell, from NCI Vic – Patrick Barry, from Goodyear and Dunlop Tyres

Grant Morris

SA – Tate O’Connor, from NCML

grant.morris@coateshire.com.au

WA – David Brennan, from Kikka Capital

0407 405 198

Credit Team of the Year Finalists Caltex South East Water and congratulations to all nominees who made it a very close contest in deed, right across the country.

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

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CEO Year in Review 2014/15 The 2014/15 membership year has been one of great achievements for the AICM and has laid new ground to build on in 2015/16 and beyond. Young Credit Professional of the Year – Supported by Dun and Bradstreet 2014 saw the first ever joint winners • Anna Golubeva – Hilti • Rebecca Edmiston – Bendigo and Adelaide Bank 2015 saw the highest level of interest ever!

Credit Team of the Year – Supported by Veda In 2015 we received applications from companies in industries including Utilities, Consumer Credit, Banking and Finance, Local Government, Insurance, Agriculture and Manufacturing to name a few. The four finalist teams received a $1000 team development Grant, a new inclusion in 2015. This was used by the teams for activities such as team bonding and learning new skills and knowledge. The 2014 Finalists were: Recoveries Corporation Pty Ltd Reece Seek Hilti The 2014 Credit Team of the Year was Reece!

Financial Results Through rational control of costs and significant effort on the part of Staff, Board Members and Councillors the AICM achieved a very welcome better than budget surplus. This surplus builds our net asset position and allows for investment in a number of projects such as the new Website that will build the profile of Credit Management and the AICM.

Record Member Participation With new and refreshed events in every division, 2015 saw record attendance at events across the country such as Women in Credit Luncheon’s, Insolvency Symposiums, Trivia Nights, Pinnacle Awards, breakfasts and dinners. Following sold out events in Sydney, the Pinnacle Awards are being expanded from NSW to Victoria in December this year and the Women in Credit events to Brisbane (September) and Melbourne (November).

International Associations A Licencing agreement was entered with the UK Credit Institute, Chartered Institute of Credit Management. This will see the AICM deliver Quality Accreditation for Australian operations and lift the standard of Credit Management in Australia.

Increased Partnerships In 2015 we recognised the role our sponsors and supporters play in our Institute by recognising them as National and Divisional Partners. Our National Partners are Veda, Dun and Bradstreet and Austral Mercantile. Our partners have all made significant contributions to the AICM by providing their expertise, connections or other assistance on top of their financial contributions. Don’t forget to support them at every opportunity.

Learning Services We saw significant increases in student numbers undertaking Certificate IV or Diploma in Credit Management Qualifications both online and face to face. We continued to improve the learning experience for students in the online environment and have expanded our face to face training sessions as a result of several classes being fully subscribed – especially since pricing revisions in January 2015. In-house training was conducted at major banks and finance companies, utilities and trade credit operations as well as in Manilla.

20% increase in Certified Credit Executives The CCE designation is gaining some positive momentum with a 20% increase in members achieving CCE status in the 2014/15 membership year.

National Conference The 2014 National Conference, held at the Marriott Gold Coast, was one of the largest gatherings of Credit Professionals from around Australia for several years. The 2015 National Conference at the Sofitel Wentworth Sydney was, at the time of writing, well on the road to exceed the 2014 numbers.

More information and updates In order to bring you more timely information the AICM moved into the digital era bringing you monthly newsletters and a digital magazine. The monthly newsletter brings you timely informative articles (such as quarterly insolvency statistics) relevant articles and AICM related updates. It also includes details of the upcoming events, professional development and face to face training sessions. The digital magazine allows for more timely publication of information and has allowed more articles to be included due to fewer restrictions than print versions. The digital version also allows for links to additional content such as videos, websites and additional information.

CEO Year Ahead 2015/16

Young Credit Professional of the Year – Supported by Dun and Bradstreet The 2015 finalists are • NSW – Kimberley Hale, from Baycorp • Qld – Michael McDowell, from NCI • Vic/Tas – Patrick Barry, from Goodyear and Dunlop Tyres • SA – Tate O’Connor, from NCML • WA – David Brennan, from Kikka Capital The finalists progress to the national conference for a further panel interview and presentation in order to be named the 2015 Young Credit Professional of Australia.

Credit Team of the Year – Supported by Veda The 2015 Finalists are Wyong Council South East Water Caltex Peters Ice Cream Following the presentations and interviews the Judging panel (after much deliberation) selected Caltex and South East Water as the final two. The 2015 National Credit Team of the Year will be announced at the AICM Conference in Sydney in October!

Refreshed Divisional Councils All divisional councils are refreshed and invigorated with the addition of new councillors to an experienced core. We welcome new Divisional Presidents Lisa Marr WA and Peter Mills Qld. All of the councils will be making further efforts to understand the pressures you face in your roles and how the AICM can help.

Developing Credit Professionals at all levels Credit Toolbox A newly designed series of ½ day toolbox sessions will be delivered throughout 2015/16. These are designed as either a refresher or introduction to the fundamentals of Credit Management. National Qualifications The AICM remains the best place to obtain qualifications in Credit Management. Students at all levels can work toward completing the Certificate IV or Diploma in Credit Management qualifications or select units that meet a specific need. Professional Development – now including webinars The regular divisional events will be supplemented by regular webinars to increase the access to updates and information on current topics affecting credit management.

Brand New Website The AICM’s digital presence has undergone a gradual refresh over the last 12 months which will be finalised with a brand new website due for delivery in October/November 2015. The new website will: •C learly communicate the value and role of the AICM, •B e easier to use and navigate especially for online registrations and payments, •P rovide more information, such as news and articles in an easy to access format. Above all the website will lift the profile of the AICM and the Credit Profession.

Membership Growth Growth of our membership is an important component of lifting the profile of the Credit Profession. In 2015/16 we are targeting membership growth. Whist this may seem modest it should be viewed against a backdrop of many professional bodies experiencing significant declines in membership numbers. There are a number of activities planned to attract Credit Professionals to the AICM however the best initiative is our members being AICM ambassadors and sharing their experiences with Credit Professionals and Business Professionals.

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Looking forward the 2015/16 membership year is already shaping up to be one of further advancements.

National Conference The 2015 National Conference at the Sofitel Wentworth Sydney was, at the time of writing, well on the road to being the biggest and best gathering of Credit Professionals for many years. In 2016 the conference will head back to the Gold Coast but at a new venue to us and a brand new conference centre at Seaworld Hotel and Resort.

AICM Quality Accreditation – AICMQ Growing on the strengths of our sister institute in the UK, the Chartered Institute of Credit Management, the AICM will launch the AICMQ Quality Accreditation program. The Quality Accreditation program will be a formal quality accreditation and help credit operations benchmark themselves against clearly defined best practice criteria and embark on continuous improvement.

Human Resources

Peak performance – is your head in the game? By Linda Murray* How often have you stood and admired the performance of our elite athletes, and thought about the discipline and concentration it must take to reach that level of success? Now let me ask you this. How often have you admired the performance of our top leaders and considered what it took to get there? In most cases, it’s the athletes who dominated our thoughts, yet sustained peak performance doesn’t happen by accident in any industry. To be capable of peak performance as a leader, you’ve really got to get your head in the game because it can be either your greatest ally or your worst enemy. Your mind is powerful – probably far more powerful than you realise. The more you practice and exercise your mind, the more capable you are of sustaining your peak performance. Let’s get your mind warmed up.

Linda Murray

Stop focusing on the negative When you’re pushing yourself to greatness, one small negative consumes your focus, like a pimple on your first date. It is so easy to think that this one bad event will create a chain reaction, however that kind of thinking can ruin all of the hard work that got you this far in the first place. Great leaders have taught themselves to look at the circumstances behind the negative event, and take lessons from them. This simple shift of focus changes their reactions from panic and self-blame, to one which is more positive and helps move them forward. So, make a mistake, forgive yourself and call it a learning experience.

Visualise success Rehearse key skills, practice responses to changing circumstances, and achieve emotional readiness. Think of potential obstacles, and visualise how you will overcome them. It’s the same process the athletes use to prepare for their events. You practice over and over, building action pathways in your brain, until you can perform without thinking. So rehearse, and picture success. See it, hear it, feel it. Imagine yourself giving an inspiring presentation, solving a problem, negotiating a difficult agreement, gaining recognition, or accomplishing your goal. Make mental rehearsal a daily habit.

slows your responses and your thought processes, and elevates your stress levels. In a quickly changing environment, where your team looks to you for leadership, you need to be able to think on your feet and choose the best game plan. If you’re sleep deprived, you’ll be short on patience and concentration, which is not a good mix. Start building good sleep habits and routines and you’ll notice the difference immediately.

Just believe in yourself Michael Jordan said “You have to expect things of yourself before you can do them.” Sometimes you just have to stop analysing and start doing. Expect high performance. Expect success. Trust your instinct because it works harder than you do to keep you on the right track. You know what to do; allow yourself to do it. Believe in yourself enough to make it happen.

If you are going to doubt something, doubt your limits. – Don Ward

Look after your mind – sleep

You are the one who defines your limits as well as your goals. Don’t doubt that you can be an exceptional leader. Yes, it will take some work to keep your mind in the right space to achieve peak performance, but a trained mind is a powerful thing. Not only will it help you become a peak performer, it will make it easier to sustain your performance at that level. u

Just as athletes care for their bodies, you need to care for your mind, and in this case, it’s sleep which has the huge impact. Lack of sleep affects your ability to think clearly,

*Linda Murray is Business Coach, Executive Coach & Mentor for high performing professional women. M: 0405 322 005 www.athenacoaching.com.au

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

Human Resources

How to get the most out of networking By Cynthia Thomas*

As credit managers, sales and networking aren’t always necessarily front of mind and representing yourself and your organisation at an event can often seem daunting. When you find yourself at the front line however, the below practical tips will help you make the most of the opportunity and provide some guidance to better promote yourself and your organisation.

Be prepared

“Being a good networker takes practice and can be challenging at first, however preparation is key and will go a long way to helping you deal with any nerves and leave a positive first impression.”

The key to successfully networking and connecting with potential suppliers and clients is being prepared, professional and proactive. Being a good networker takes practice and can be challenging at first, however preparation is key and will go a long way to helping you deal with any nerves and leave a positive first impression. Make sure: zz your business cards are current; zz your LinkedIn profile is up to date; zz you have a presentable image representing your personal and business brand; and zz you have an objective – know why you are attending the event and what you want to achieve by being there. If you have a sales role or similar, which is all about connecting with people, it’s also important you take the time to understand your target audience.

Put yourself out there

Cynthia Thomas

Industry events often have a blend of suppliers and vendors and are a great opportunity to research the market and its supporting services. To ensure you make the most of these events,

try to visit as many trade booths as possible. Suppliers are there because they’re interested in your business and you’ll get a first-hand feel for their organisation. As mentioned earlier, it helps to know what your objectives are before you enter a trade show, so you can be on the front foot with booth representatives and ensure you’re getting the information you need. They will want to know as much about your business and potential opportunities as possible so they can best accommodate your queries. It’s a good idea to exchange contact information even if you don’t currently require their services. There could be a key piece of information they give you, or would have access to, that you may need later on when you get back to the office; build your network as much as possible with subject matter experts.

Get your game on! The trade booths at industry events are a hugely valuable part of the conference experience for delegates and exhibitors. It is not often all the main suppliers in the industry are in the one room so take this opportunity to learn as much as possible about the companies represented and their insights into the general trends of the industry. While you may not conduct any business at the conference understanding the key suppliers in the industry will help you when and if you do face a challenge they can help with. u

*Cynthia Thomas is National Sales Manager for Austral Mercantile. Email: cynthia. thomas@australmercantile.com.au

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

Marked improvement in the way Australian companies are managing credit and payment terms: Coface research l Coface warns Australian companies to avoid overextending themselves in a bid to win business in Asia l In China, companies payment experiences are deteriorating l As a result, more Chinese businesses seeking improved protection and better risk management of customers’ non-payment of invoices – a strong signal for Australian companies wishing to export to do the same By Chris Little

While there has been an overall deterioration in the payment experience of corporations in the Asia Pacific region, Australian companies have been adopting a more prudent and disciplined approach in the credit and payment terms they are offering their customers according to the latest Survey of Corporate Payment Trends in Asia Pacific conducted by Coface, one of the world’s leading international credit insurance. The report, which surveyed 2,695 companies in eight Asia Pacific countries, states two years ago 92.9% of Australian companies offered credit terms to their customers. Interestingly, this figure has now fallen to 81.9%. In addition, there has been a 12.6%

drop in the number of companies experiencing overdue payments from their customers to 74% of those surveyed. Of those Australian companies that provided credit terms to their customers, 82.6% of them offer average credit terms of 30 days and 16.4% offer between 60 and 90 days. No company offered average credit terms of 120 day and just 1.03% offered average credit terms of more than 120 days. Mr Chris Little, Coface Commercial Director in Australia, said the trend of Australian companies taking tighter control of their credit management was encouraging. “Coface’s latest research indicates

“...latest research indicates that the number of Australian companies experiencing ultra-long overdue payments of more than 120 days that account for more than 2% of turnover ... has fallen from 23% in the previous year to 17%” 8

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

Credit Management

that the number of Australian companies experiencing ultra-long overdue payments of more than 120 days that account for more than 2% of turnover – the point as which this would hurt a company’s liquidity – has fallen from 23% in the previous year to 17%,” he said. In China things have moved in the opposite direction. Two years ago 86.4% of Chinese companies offered credit to customers. This has now risen to 89.6%. Only 30.1% of the Chinese businesses surveyed offer 30 day average credit terms with the majority (58.3%) offering between 60 and 90 day average credit terms. More than 7.5% of Chinese companies surveyed provided average credit terms of 120 or more days. Also, 79.8% of China-based

companies surveyed said they were dealing with overdues compared with 77.1% two years earlier. What’s more, 56.4% of Chinese companies confirmed the US dollar value of overdues had increased. This compares with 23.4% of Australian companies experiencing higher US dollar values of overdues. What is most concerning, however, for Chinese businesses is that 30% of those that offer credit terms said they were experiencing ultra-long overdue payments of more than 120 days that account for more than 2% of turnover, which is unsustainable. The main reasons cited by Chinabased businesses for overdue payments was customers’ financial difficulties and management problems (76.2%), and fraud or lack of morality

Presentations

in customers trying to delay payments (12.2%) as well as commercial disputes (1.7%). In Australia, 68.5% of respondents said overdues were a result of customers’ financial difficulties and management problems while just 4.0% said overdues were due to customer fraud or lack of morality, however 10.3% claimed it was due to commercial disputes. Mr Little said, “In speaking with Coface clients in Australia that have traditionally focused on conducting business just in the Australian market, I’d say 70% of those looking to expand into offshore exporting are now looking to Asia. As tempting as it may seem to pursue business in the considerably larger Asian markets, it’s important Australian businesses do not relax their credit management

Awards: YC PA

Social events

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

controls with extended payment terms in an attempt to be seen as competitive to win new orders as it could actually weaken their business and stunt future growth,” he said. Coface research indicates the payment experience in China is getting worse, with a rising ratio of non-performing loans, which are up 97% since 2011, and a corporate sector overleveraged by high-cost debt. As a result, earlier this month, Coface issued a downgrade on China, placing an A4 rating which deems the risk of businesses defaulting as “acceptable”. Other countries in the region with similar ratings include India, Indonesia and Thailand. Coface’s rating for Australia is A2, which rates the risk of businesses defaulting as “low”. Other countries in the region with this rating include Singapore, Malaysia, New Zealand and South Korea. Countries with A1 “very low” risk ratings are Japan, Hong Kong and Taiwan. Mr Little added, “Australian businesses wishing to expand overseas need to do more to protect their businesses from the nonpayment of debts. The need to take more credit protection measures is something Australian companies should all take note of if they are going to conduct or extend their businesses in China,” he said. The Coface survey shows 31.5% do not use any form of credit management tool. This is up from 23.6% from the year before. In China, the figure for the non-use of credit management tools is similar at just below 30%. However, with extended credit terms and escalating overdue levels, the figure for the non-use of credit management tools is down

from 36.5% the year before and 41.7% in 2012. From a geographic standpoint, Australia is ideally placed to export goods and services to its regional neighbours. In addition, with the lower Australian dollar, free trade agreements signed late last year with China, Japan and South Korea and technological improvements made in e-tailing, as well as the rising number of middle class citizens in China, these companies want to seize the opportunity to grow. Coface’s top 10 tips for companies wishing to expand into China and other Asian countries includes: zz Clearly identify the entity you are dealing with but this can be challenging as there is no requirement in China for companies to lodge their financials with a regulatory authority zz Do not rely, as many companies do, on three trade references conducted over the phone or via email zz Instead use a credit reference agency to gain deeper insight on the trade history of a potential customer zz Take out credit risk insurance to protect you against payment arrears or non-payment of invoices zz As part of this, use an experienced risk underwriter to advise on setting of credit amounts for customers in different countries and stick to them zz Use an on-the-ground agent to manage the relationship with partners as they will have a clear view of the local market and can pinpoint any existing or potential issues zz If a long-term client is suddenly

“Australian businesses wishing to expand overseas need to do more to protect their businesses from the non-payment of debts.” 10

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

delaying payment this could signal a cashflow problem in their business; it’s important to be in regular communications to ensure payment is not further delayed zz Instil discipline with credit terms (30 or 90 days) and the level of credit you are prepared to offer and do not be tempted to overtrade or offer extended credit terms zz By having a Trade Credit Risk insurance policy, companies can avoid letters of credit as they impact their cashflow zz Operate within your means.

About the survey The survey was conducted in 4Q2014 across eight economies – Hong Kong, Australia, India, Japan, Thailand, Singapore, Taiwan and China – among 2,695 companies. Around 33% of the companies were located in China, 19% were in Hong Kong, 11% from India and 9% from Australia. They represented half the sample size, while Thailand, Japan and Singapore accounted for the remaining survey respondents. The survey respondents represented a wide-range of company sizes. Among the respondents, 34% had estimated sales revenues of lower than €5m in 2014, while 23% expected sales revenues to be between €5m to €10m. 27% of companies had revenues between €10m and €100m, while 16% had annual revenues of over €100m. u

Media contact: Tania MUÑIZ. Ph: (02) 8235 8615, Email: tania.muniz@coface.com www.coface.com About Coface: The Coface Group, a worldwide leader in credit insurance, offers companies around the globe solutions to protect them against the risk of financial default of their clients, both on the domestic market and for export. In 2014, the Group, supported by its 4,406 staff, posted a consolidated turnover of €1.441 billion. Present directly or indirectly in 99 countries, it secures transactions of 40,000 companies in more than 200 countries. Each quarter, Coface publishes its assessments of country risk for 160 countries, based on its unique knowledge of companies’ payment behaviour and on the expertise of its 350 underwriters located close to clients and their debtors. In France, Coface manages export public guarantees on behalf of the French State.

Credit Management

Veda National Credit Manager’s Survey 2015 By Moses Samaha* Over the last few years, Veda’s credit risk management team has conducted an annual survey of Australian credit managers. These surveys have been providing valuable insights into the evolution of credit risk management practices in Australia. This year’s survey concluded in October 2015, with a total of 240 credit managers from a variety of firms of different size and industry participating. In addition, this year’s survey had a special focus on the outlook for credit management in the future over the period to 2020. The results of the 2015 survey were analysed by Deloitte Access Economics. The timing of the 2015 survey coincided with a more upbeat Federal Budget and one of the themes that emerged was that credit managers have also become more upbeat about broader economic conditions. Economic conditions are seen to have

Moses Samaha

improved and sentiment regarding future economic conditions has also become more positive. The proportion of respondents expecting a negative impact from the economy in the next 6-12 months (21%) recorded a decline for the fourth consecutive year. However, growth in the Australian economy has remained below trend since the survey and uncertainties about our main trading partner, China, have intensified in recent times. Despite economic conditions being viewed as somewhat easier, credit managers continued to adopt stricter and tighter lending criteria. For example, 70% of credit managers indicated they had increased or tightened collections activity over the past 6 months and 59% planned to do so in the next 6 months. However, the trend has slowed in this respect with credit managers intending to tighten practices at a slower pace than they were planning a year ago. Among the other findings, respondents indicated a reduction in the use of some information types such as ASIC information, PPSR grantor search results and credit reports in making credit decisions. Average payment terms had also shortened slightly to 29.38 days, while there was a marginal improvement in Days Sales Outstanding performance to 43.44 in 2015. Credit management is a function that has historically been situated within the Finance department. However, the proportion of respondents indicating that credit management would be situated within the Finance department fell from 65% currently to 54% in the future. In particular, there may be a tendency for credit management to move out of

the finance department and operate either as part of the management function more generally, or as an independently operating function. Changing technology, particularly digital and analytical innovations, have influenced the credit management process over the years. Yet, human judgement has historically been an important aspect of credit management. Looking ahead, there was a slight skew towards partial agreement that the credit management process would become more automated in the future, but many respondents held differing opinions. It is also interesting to note that a very large proportion (85%) stated that offshoring of credit management would not occur in the future. Only around one third (32%) of respondents stated that they currently give advice about which markets to approach to sales or management. Yet, this is expected to change markedly in the future. In the future, just over half (51%) of credit managers expected to provide this advice to sales or management. Perhaps not surprisingly given this changing role of credit managers, the greatest challenge for the credit manager of the future as nominated by credit managers was the challenge to position credit management as a strategic partner. Around 45% of respondents nominated this as the biggest challenge, but 23% nominated that ensuring their organisation actually uses credit information was the biggest challenge. u

*Moses Samaha is General Manager, Commercial & Property Solutions for Veda. www.veda.com.au

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

Benchmarking

– a critically important enabler of improving performance

By Michael Hartman* Measurements provide context, helping focus on what matters ….enabling us to manage better, as we all have heard: “You manage what you measure”. We set targets and plan activities – develop ‘budgets’, track actual performance against them and re-plan based on variances – all with the aim of more effectively and consistently achieving our objectives. But is it enough to know only how your business or department is travelling in absolute terms? Unless your business is one of the extremely rare structural monopolies – no.

So how important is it then to know how your performance stacks up against others? Think how many times the questions has been asked – “Where are we sitting?” or “How are we tracking versus the competition?” In racing it is vital to know who is in front of you, who is next to you and who is behind you … and what they are doing….it’s the same in business. Typically all that is available today to assist in answering these questions are ad hoc reports – which are limited in terms of accuracy, frequency and cost, and Publicly Reported Series Data – which is limited in terms of range

Three Major Benefits of Benchmarking

AICM is looking to make such information available for AICM members offering Trade Credit AICM have teamed up with the Benchmarking Division of RFi Group, a global business intelligence provider specialising in Financial Services and are looking for expressions of interest

Benefits of Benchmarking

Product and Process Improvement

zz Benchmarking helps identify the gaps between the organisation that is undertaking the benchmarking assessment and best practice.

Cost Reduction

zz Undertaking benchmarking can lead to improvements being incorporated into processes and systems delivering gains in efficiency and effectiveness.

Competitive Strategy

zz Benchmarking can help align improvement activity with strategic goals and objectives.

Michael Hartman

and relevance of metrics, and often accuracy. The ideal approach to understanding relative/competitive performance is benchmarking – or more specifically in this case a continuous programme of gathering and sharing specifically comparable and relevant data covering the end to end credit lifecycle (on a strictly anonymised basis) by design. Unlike Ad Hoc Reports or Publically Reported Series Data, benchmarking is interactive.…and whilst that means it involves input on your behalf the outputs are assured to be comparable and much more relevant hence far more actionable for benefit.

We all have competitors…and we hear frequently: “The level of competition seems to be ever increasing”. And surprising as it may seem, some of these competitors might be doing some things better than you are.

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

Credit Management

What would be involved for the Trade Credit benchmarking Pilot? Firstly it’s important to stress that participation in the Pilot comes with no obligation to continue with the programme should it prove to be a success and becomes ongoing (which history suggest will be the case). There would be no cost for participation in the Pilot (aside from administrative and IT costs related to activities described below). Assuming the Pilot is successful the service will be offered on an annual subscription basis anticipated at this stage to be in the vicinity of $3,500. In terms of Timing: —— Kick off within the month subject to getting sufficient interest. —— The intention is to run the pilot and present results back to participants within a couple of months with a summary of the exercise to be presented back to the wider membership. Input required from Pilot participants: —— Attendance at/on a kick off meeting or conference call (date tba) —— A small amount of paperwork – a two way non-disclosure agreement (NDA); and —— Gathering the required data,

relating to your organisation type and your trade credit activities and performance – information that you are likely to have ‘readily’ available. What Pilot participants will receive in return: zz Output reports – showing you clearly where you stand relative to the other participants…though the other participants’ performance will not be individually identifiable. zz A facilitated review – either face to face as a group or via a conference call where we’ll review what the reports say, and discuss what they mean. What is envisaged if the Pilot is successful: zz Ongoing quarterly reports – (most likely containing monthly data) – the same type as in the Pilot and potentially expanded based on what can be done with the data that is captured. zz Facilitated reviews – either face to face as a group or via a conference call. NOTE: These will be optional and at additional cost to the subscription.

Recommendation (Figure 1): Having participated in a number of benchmarking forums, I know first-hand the value of this type of information. In fact, each time I have explained this to the various executive groups and Boards that I have reported to, they have all insisted benchmarking be included as a regular part of their reporting. One fact that may help you make a decision: Since starting the Risk and Collections Managers’ Roundtables back in 2002, not a single participating organisation has ever left …. zero attrition over 13 years! We are looking for at least 10 to start (and will accommodate a few more). 6 members have already said they wish to participate…and a number of others seeking Executive/Board approval to get involved. If you are interested please contact either Nick Pilavidis, CEO of AICM at aicm@aicm.com.au or myself, Michael Hartman at Mhartmanau@gmail.com u *Michael Hartman is one of the Principal Consultants at Inflexion Point Consulting. Email: mhartman@inflexionpoint.com.au, www.inflexionpoint.com.au

Figure 1: The Benefits of Benchmarking

Higher

AFTER BENCHMARKING

BEST-IN-CLASS PERFORMANCE CURVE AVERAGE PERFORMANCE CURVE

QUALITY of SERVICE

from AICM members to pilot a trade credit specific benchmarking program. The RFi Group benchmarking team have been operating a number of Risk and Collections Managers’ Roundtables in both Australia and New Zealand since 2002 – benchmarking portfolio, collections and repayment performance for loan books across Mortgages, Credit Cards, Personal Loans, Auto Finance, SME and Commercial Lending. Subscribers to their benchmarking programmes include all major and second tier banks, plus a number of Mutuals and Finance Houses. Now you can gain the same benefits they have from this type of activity.

STARTING POINT: BEFORE BENCHMARKING

Lower

COST PER CALL

Higher

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

Can cash flow finance help credit managers get paid on time… and why we should be raising a glass to it at the AICM National Conference? By Ian Smallman*

As we all know, cash flow is one of the most important features of the health of any business, but how many people are aware just how far the cash flow chain stretches? While many may see it as a two way street between them and the clients due to pay invoices, as credit managers know it’s a much more involved process. Depending on how extensive a company’s supply chain is, cash and invoices will flow on to a number of businesses. If there’s a blockage at one point and a company is paid late, this then influences how they pay their creditors and starts the domino effect of non-payment up the chain. While the variables that determine when an invoice will be paid are many, there’s a solution that can benefit most members of the supply chain – cash flow finance. In particular, credit managers can benefit if their slower paying clients take up these services. By encouraging their clients to consider this option, they can increase the likelihood of getting paid regularly, as the people that owe them money have access to finance based on their invoices.

Are businesses getting the most out of cash flow finance? Ian Smallman MICM

For some businesses and most credit

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

managers, understanding the benefits of debtor finance will be nothing new, but many SME’s in Australia aren’t even aware that the product exists, whereas in the UK it’s very much a mainstream banking product. Put simply, cash flow finance takes the guess work out of getting paid, so late-paying clients can’t disrupt your own DSO’s. According to the Debtor and Invoice Finance Association (DIFA), using cash flow finance (invoice discounting or factoring) is a business strategy that is maintaining its popularity with companies throughout Australia. The organisation released figures revealing that there are about 4500 companies who use it around the country. There’s a significant amount of turnover tied up in the invoice factoring sector as well, with the industry peaking notably this time last year – food for thought heading into this year’s silly season! DIFA revealed that quarterly turnover for the industry usually sat at around the $15 billion mark, rising to well over $17 billion for the December quarter. This is a notable increase on the numbers seen just five years ago, as more businesses warm to the benefits of invoice factoring.

Credit Management

What do credit managers need to know about cash flow finance?

The benefits of invoice factoring goes beyond cash flow

To ensure their clients are aware of this finance option, credit managers should be aware of how invoice discounting, or factoring, works and how to benefit from it. In many cases, credit managers are paid late because their clients are chasing their own late-paying debtors, reinforcing the idea detailed above. Every late invoice has a flow on effect – unless that debtor is supported by cash flow finance. On top of this, as we all know, late payments can strain business relationships. One of the other key benefits inherent in using a cash flow finance solution is the time savings from not having to chase clients. This adds to the stress for businesses that are trying to secure payments from clients so they can settle their own outstanding debts. They’re chasing money while being chased themselves, whereas if credit managers can sell their clients on the advantages of having a cash flow finance provider, it can potentially save both parties a lot of time and stress.

While it’s great receiving the cash owed to your business on time, the advantages for cash flow finance goes beyond just the money in the bank, as cash flow finance providers can incorporate credit insurance into the facility. If your customers are using cash flow finance, and debtor insurance is built in, it protects them against their own unexpected bad debts.

Why raise a glass to cash flow finance at the AICM National Conference? Cash flow finance is used in a broad range of business sectors including labour hire, manufacturing, wholesale trade, transport and storage, agriculture and mining, business services and construction. However one industry that is benefitting from it right now is the expanding boutique craft beer, cider, wine & spirits market, as Australians are looking for more premium quality products and producers have responded. The extended payment terms of the highly concentrated major liquor retailers

in Australia and the requirement for prompt payment of excise duty leads to considerable cash flow problems for brewers, wine growers and liquor importers and many of them are turning to cash flow finance to assist their growth.

Why does the education process need to start with credit managers? Credit managers are the most knowledgeable people in an organisation when it comes to determining business risk. One of their key jobs is to detect the likelihood of clients paying late or defaulting and how that could affect their company. Because of this, they typically won’t be aware of all options to ensure their clients can pay their bills. In most cases, cash flow finance will create a more stable relationship between them and their clients, as both parties will have an easier time receiving the money owed to them by debtors. u

*Ian Smallman is National Sales Manager for Earlypay. Earlypay is part of the CML Group, an ASX listed provider of payroll finance and employment services. www.earlypay.com.au

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

Communicating – the old fashioned way By Frank Vredenbregt*

Frank Vredenbregt LICM CCE

An article in the AICM Magazine I read several years ago sticks in my mind. It was a reprint of an article by a retired British Credit Manager. He passed a comment “the job of a credit manager is to remove all obstacles to payment”. Whilst I endorse his comment, I believe it goes further than that. Our responsibilities include getting payment while at the same time maintaining good customer relations, and maintaining the cash flow of the business. I am not going to launch into a treatise on credit management, but highlight the undisputed most valuable tool we can use to do that – the humble telephone.

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

To dinosaurs like me, it is the telephone (or phone). To others it may be the mobile, the cell, the i-phone, the smart phone. Call it what you will, it can’t be beaten. Unfortunately, the telephone appears at times to be a dying resource. E-mails, Facebook, Linked-in etc are taking over. I can recall in my earlier years working in a bank where we had secret code books and telex machines for communicating with overseas banks. Modern technologies have definitely made life easier, but they should not replace the basics. I have even seen staff e-mail the person sitting at the next desk. What?

Credit Management

Get real! You have a mouth. Other people have ears. Use them. Some people say I am old fashioned. Maybe I am, but I do keep up with technology. I never used to be able to figure out how to use the video, now I can’t figure out how to use streaming. I can use a computer, I am competent with EXCEL and WORD, but I would never call myself “tech-savy”, and facebook is beyond me. How many times do you sit in a restaurant, and see all people at one table engrossed in their mobiles? I can see a use for it, but we appear to be losing the basic art of communication by talking. I once had to set up a facebook account to look at some methodology published by a Government Department. I now get a constant barrage of requests from people I may or may not know wanting to be my ‘friend’. I also get a constant stream of requests to join linked-in and other such forums. Sorry, no offence, but I have trouble in my average working day keeping up with the e-mails I receive. Why don’t people just pick up the phone and say “hey Frank, can you do this for me?” or “what do you think of this?” or just “g’day.” They would get a quicker response, my day would be easier, and our rapport would build. By talking to customers, you can build a rapport which can even skyrocket into genuine friendship. An e-mail can be ignored or deleted. To ignore a phone call is more difficult. By building rapport with a customer, you can get to the stage when they will ring you if they have a problem. It makes your job so much easier. You can even build lasting friendships, be they strictly business or personal. Some are mutual, some

are one way, some you want, some you don’t. But friendships help build that communication ability to soaring levels. I once made a ‘friend for life’ (more one way than mutual) by helping a customer manage his cash flow and save his business. Some years later he invited me for a weekend with him at a brothel his wife owned. The invitation WAS declined, but it shows the level of rapport that can be built by communication. I do not allow my staff to use message bank. If a phone in the department rings during office hours, it must be answered. If the person on whose desk the phone sits is not there, someone else must pick it up and deal with the immediate problem, not just take a message. Generally, we, as credit managers, do not ring a customer unless there is a problem. Conversely, a customer does not ring us unless there is a problem. If a customer has a problem he wants it dealt with now, not later when you can find the time to call him back. This is called basic customer service. If you are communicating with your customers, half your battle is won. At the start of this article I quoted “the job of a credit manager is to remove all obstacles to payment”. Building on this, I say “if a customer has not paid, why has he not paid? What can I do so he can pay?” It may be that cash is a bit tight and he needs a couple of days. It is so much easier if the customer rings you and says “I am not in a position to pay you this month. I need a couple of days, but will definitely have my payment to you by the second”. Yes, you will have an overdue account, but you would have had it anyway, but it is an account you don’t have to follow

By talking to customers, you can build a rapport which can even skyrocket into genuine friendship. An e-mail can be ignored or deleted.

up. This scenario occurs as a result of communication. Communication by phone. Talking to your customers, building rapport, not sending them an email, or a text message when they are overdue.

Tips when using collecting by telephone: 1. Answer it when it rings. 2. Never argue with a customer. 3. A customer is always right. It is part of the art of being a credit manager to convince him that you are more right than he is. 4. If a customer gets abusive to you personally, don’t get upset. Tell him that you will hang up if he continues. 5. If a customer abuses your system, put up with it. He is entitled to his opinion. Take note and analyse your systems. 6. Diarise arrangements and follow up immediately if commitments not kept. As a footnote, I do accept that in some consumer situations, contact by text is needed and used, generally used to high volume and small dollar amounts, but I seriously doubt it is as effective as a debtor answering a phone call from a credit officer. u

*Frank Vredenbregt LICM (CCE), FIPA is Group Credit Manager for Automotive Holdings Group Limited.

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

ATO toughening up By Adam Lysle*

Adam Lysle

It has been widely reported and in the main accepted that the Australian Taxation Office (“ATO”) aren’t actually the best when collecting their debts. Many talk about ‘threshholds’ and ‘agreements’ when speaking about their interaction with the ATO but in reality, when the ATO forces the hand, it generally ends up collecting 5% of the debt owed. When the ATO is owed over $35 Billion dollars and has a net debt growth of around 10% per annum, this is a big issue and it won’t go away very quietly. The ATO has re-established their stance of collection in the last six months with their suite of options including garnishee notices, payment arrangements, director penalty notices and winding up applications. That said, is it really making a difference? You see, 64% of all insolvent debt is made up by small business and 60% of all small business have turnover less than $500,000 according to a report by the Inspector General of Taxation, Mr Ali Noroozi. One of the recommendations put forward by Mr Noroozi was that the ATO take security by way of mortgages or bank guarantees and that the internal process for the ATO is better refined. Also, an increased utilisation of external debt collection agents to collect debt owed to the ATO was a key point. Other than these, the majority of the recommendations were benign with the exception of moving the debt collection team into the compliance section (audit) of the ATO. What does it mean for members of the AICM? Well there are a number of factors I believe our membership should take into consideration:

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

a) Director Guarantees; b) Company Tax Debt; and c) Garnishee rights. Let’s deal with each of these quite specifically:

Director Guarantees The Inspector General of Taxation has recently reported to the Commissioner of Taxation that the powers that the ATO have to gain security for debts owed to the ATO should be more regularly utilised. When AICM members seek Director’s Guarantees, the question needs to be asked about the debt owed to the ATO and maybe even requesting a copy of the latest running account balance from the ATO. One naturally assumes that a guarantee is actually worth something but when the ATO infiltrates the security mix and potentially dilutes any equity that a creditor is relying upon, a guarantee may well not be all it seems. Therefore, not only at the time credit is provided but at regular intervals, AICM members should seek updated information from debtors as to their financial position and determine the dilution if any of any equity that directors have at that time. Perhaps reconsider terms whereby a bi-annual review on the debtors financial position is conducted by your external accountant or insolvency expert.

Company Tax Debt The ATO is not commercial in its collections and the principle issue here is that the ATO is increasing its debt by 10% on average for the last three years; which when extrapolated out would mean that as at 30 June 2015, the total debt owed to the ATO

Credit Management

would be in the vicinity of $40B with almost half of this being written off by the ATO. So, what does this mean for business? It means that now more than ever, businesses need to make sure that if they have a debt owing to the ATO that they need to be proactive in their approach to managing this debt. Putting it in the too hard basket just doesn’t work and potentially places the businesses and its directors at further risk. The principal thing to remember here is that there is clearly a desire to effectively transfer the debt owed to the ATO by a company and lift the corporate veil by way of seeking security from a company’s directors. This will only place pressure on debtors to extinguish claims by the ATO in priority to other creditors or in the alternative dilute their personal equity position as outlined earlier. Early advice is key.

Garnishee Rights The ATO has been quite aggressive with garnishee notices over the last six months. So much so that anecdotally we have been alerted to the ATO seeking to garnishee debts owed to factoring and debtor finance

The ATO has re-established their stance of collection in the last six months with their suite of options including garnishee notices, payment arrangements, director penalty notices and winding up applications. entities and attempt to ‘jump ahead’ using terms like ‘statutory charge’ and other acute legal arguments. AICM members should remember that the ATO have a suite of information available to them and can intercept debts owed to AICM members which could be uncomfortable for cashflow and any other collection strategies. The important factor to take into account here is to use the ‘be ahead of the game rule’. Information is the key and knowing what is going on in the debtors business should provide the most comfort.

Summary

be sought long before the situation gets out of hand. Whilst the ATO are getting their shop in order, the warning should now be heeded that the ATO is in the gym muscling up for their next phase of collection strategies. The risk for AICM members is that the ATO has a wealth of resources to muscle up and have many statutes on their side. The reward for AICM members that choose to stay ahead of the game is to minimise any exposures that could come about because of an aggressive collection process instituted by a goliath organisation that really should have dealt with the debt owed to it long before now. u

What AICM members should do is seek good sound advice from their lawyer or external accountant at the very least. This advice should

*Adam Lysle is Senior Manager at Veritas Advisory. www.veritasadvisory.com.au

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October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

Don’t get burnt by the Phoenix By Robyn Erskine and Adrian Hunter*

Many creditors are often left frustrated by what seems at times a lack of prosecution of the perpetrators of Phoenix activity, but is that about to change?

Raids undertaken

Robyn Erskine

In June of this year more than 100 ATO Officers as part of a joint ATO, Federal and State police operation into fraudulent phoenix activity took part in unannounced raids into more than a dozen Sydney law firms, accounting practices and liquidators offices. It is alleged the network of Sydney professionals may be helping to set up phoenix businesses where tax revenue of more than $40m was at risk. The ATO is particularly concerned where third parties (e.g. Registered Liquidators) that are meant to be independent and transparent may be assisting directors in this process. It is estimated phoenix activity costs the Australian economy up to $3.2 billion each year. Creditors caught out by directors engaging in illegal phoenix activity suffer the most, losing almost $2 billion in unpaid debts and the non-supply of purchased goods and services so increased attention on exposing illegal phoenix activity is long overdue.

Inter-Agency Phoenix Forum & Phoenix Taskforce

Adrian Hunter

The increased attention is not just the focus of the ATO. A number of federal agencies are paying more than just ‘lip-service’ to this troublesome area and are joining together in a whole of government approach to curtail phoenix behaviour. Recently we have seen the

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

creation of the Inter-Agency Phoenix Forum which is made up of representatives from: zz Australian Crime Commission zz Australian Federal Police zz ASIC zz Department of Education, Employment and Workplace Relations zz Fair Work Building & Construction zz Fair Work Ombudsman zz State Revenue Office zz ATO zz Australian Business Register The members of the forum are looking to work cohesively and share data between departments to enable resources to be focused on those engaged in phoenix activity. Previously the ability to share information across government agencies was limited and in some cases not legally possible. In addition, earlier this year the ATO established its Phoenix Taskforce. The Taskforce is teaming with the new Serious Financial Crime Taskforce to share intelligence and information between partner agencies to facilitate the identification, management and monitoring of suspected criminal behaviour.

But when is a Phoenix not a Phoenix? Illegal phoenix activity involves a transfer of assets from an indebted company to a new company for no or inadequate consideration. Often the new company will have essentially the same directors and be involved in similar activities. By doing this the parties set out to deliberately avoid paying creditors, tax obligations or employee entitlements.

Credit Management

Unfortunately the term phoenix is a term that has many definitions including legal phoenix, illegal phoenix and fraudulent phoenix. A legal phoenix occurs where the assets of a company are sold for fair value to another company prior to the appointment of a Liquidator. Providing fair value has been paid there is little that a Liquidator can do to overturn the sale. Understandably even in these situations creditors and at times the Liquidators appointed are unhappy about this outcome. You will note the information now on the ASIC website tries to focus creditors away from the more general term of phoenix and focuses more on illegal phoenix activity. Fraudulent ‘phoenix’ activity is a term that is preferred by the ATO and in their view occurs where a company deliberately liquidates to avoid paying in the main taxes and employee entitlements. Businesses reborn through the phoenix process often exhibit a number of similar traits. Typically these are: zz The directors of the new entity are family members of the director of the former company or are close associates, such as managers, of the former business. zz A similar or identical trading name is used by the new entity which often has a company name similar to that which it replaced (e.g. NewCo (Aust) Pty Ltd). zz The same business premises and telephone number (particularly mobile number) are used by the new entity. zz A number of employees of the former business are likely to have been transferred over to the new entity. None of the above however automatically mean that illegal or fraudulent behaviour has occurred. Often the only party that is prepared to buy the assets of the distressed business is the director. Likewise often the only way the director knows

how to earn a living is by continuing to work in the same industry doing the same work as the company in liquidation did previously. However where physical assets or intangible assets such as intellectual property or goodwill have been transferred to a new company for inadequate consideration or there is a history of systematic rolling of companies into liquidation that is great cause for concern and definitely an indication of illegal phoenix activity.

company with new suppliers who are unware of the company’s trading history.

What can I do?

How can it affect me?

Be vigilant. Sometimes creditors or suppliers to the business are unaware of the change from the original company to a new company but may receive an apparent innocuous request to change the invoicing entity from the former to the new trading entity. By working as a united community, credit professionals can help to impede the spread of illegal phoenix activity by being tough on debtors who leave them behind or by making it difficult for the new entity to get supply. zz Ensure you do adequate background checks on new credit applications to help stop these newly born phoenix companies from getting supply. zz Refuse to supply companies that are associated with directors who have a history of multiple failures. zz Make it known to your fellow credit professionals what you are seeing so that they too can be proactive in taking a stand against these operators. zz Seek to wind-up entities that you suspect of being illegally phoenixed so that ASIC may take banning action against directors with a history of corporate failures. If your debtors are in financial difficulties it is important they seek specialist insolvency advice from someone you know and trust. Through a structured workout or a bone-fide insolvency appointment, solutions can be found that will enable you to ideally collect on your debt or help to halt illegal phoenix activity. u

The ATO doesn’t stand alone in the queue of unpaid entities. Trade creditors too, are often victims of illegal phoenix activity as they can often be viewed as part of the baggage to be left behind as the director aligns the newly birthed

*Both Robyn Erskine and Adrian Hunter present regularly to discussion groups on this topic and are Official Liquidators within the practice of Brooke Bird – Restructuring, Turnaround and Insolvency Specialists. Ph: (03) 9882 6666 E: info@brookebird.com.au

What damage does Illegal Phoenix activity do? Whilst the ATO is sometimes the only creditor “left behind” in the old entity once the phoenix commences, there are other hidden costs that are not easily recognisable. These can include: zz by not paying their fair share of tax the company is able to seriously (and unfairly) undercut it’s competition which in turns causes viable companies to fail; zz workers are pressured to take leave whilst the business is transferred from the old entity to the new; zz workers can have their employment status changed from permanent to casual; zz workers are underpaid or paid irregularly; zz superannuation payments are not made; zz warranties or guarantees provided for workmanship by the old entity become unenforceable/worthless; zz company owners or directors enjoy an extravagant lifestyle at the cost of creditors who don’t get paid.

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

Economic update from Dun & Bradstreet By Darin Milner*

Darin Milner

First, a potential Grexit avoided. Next, a Chinese stock market crash with a Chinese government that intervenes one minute and withdraws the next. Now, persistent volatility on global equity and commodity markets, mass migration into Europe, and subdued growth in all advanced global economies. And another day, another new Prime Minister for Australia! We are indeed in unprecedented and inherently uncertain times. But what does this mean for credit managers, Australian businesses and the credit industry? Together with the AICM, Dun & Bradstreet identified an opportunity to host a unique event to update and educate AICM members and our customers on specifically this question. On Thursday September 3rd, we delivered the inaugural Dun &

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

Bradstreet Quarterly Economic Update with Stephen Koukoulas. We were proud to host this event in conjunction with the AICM’s Nick Pilavidis as part of their National Partners Webinar Series. This first event was incredibly timely given it was delivered two days after the monthly RBA Board meeting and interest rate decision, and immediately following a week of particular volatility on global markets. Further, recently released research by Dun & Bradstreet added a richness to the event’s content and insight that was unique to credit managers. Stephen Koukoulas, Economic Advisor to Dun & Bradstreet, discussed a broad range of research and economic indicators affecting Australian businesses. On a global level, he canvassed the slowing Chinese growth and production

Credit Management

indicators that are so critical for Australian given China is our largest trading partner. While China is undoubtedly slowing – the elephant in the room remains exactly how far it will slow. Over in the United States, the picture is brighter with their economic recovery clearly gaining traction. As the world’s incumbent economic powerhouse, the sustained GDP, consumption and employment growth they are experiencing will have significant and positive repercussions for the global economy. Closer to home, the outlook is one of cautious positivity. Dun & Bradstreet’s Business Expectations Index, which has a strong track record as an accurate leading indicator of domestic business

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October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Credit Management

sentiment, is tracking at historic highs. In similarly positive news, business sales, profit and employment/hiring expectations are all strong in this historically low interest rate and inflation environment. For the credit industry specifically, Stephen canvassed further good signs with bad debt levels and average payment times staying remarkably low, all while we are seeing a broad-based upturn in credit growth. Concerns for the domestic economy include unemployment edging higher, multi-speed

economies persisting across our states (growth in NSW and Victoria while the other states struggle), and sluggish business investment. Looking ahead, Dun & Bradstreet is predicting economic growth to remain subdued in the near term while picking up in 2016, with unemployment to remain in the 6-6.5% band. We see interest rates on hold for the long term, with the RBA content to sit and wait for fresh news from the larger global economies. Finally, we predict the Australian Dollar to remain under persistent pressure in

We are indeed in unprecedented and inherently uncertain times. But what does this mean for credit managers, Australian businesses and the credit industry? 24

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

the 60-70 US cent range, but could bounce if the domestic growth outlook improves. And with 2016 an election year under a new Prime Minister seeking to quickly make his mark, we may see significant policy changes that could impact the economy. Feedback from this webinar has been consistently excellent, such that we are delighted to announce that we will continue to partner with the AICM to host this ongoing economic webinar series on a quarterly basis going forward. We invite all AICM members to join us for the next Quarterly Economic Update webinar in early December which will be an event not to be missed. Look out for your invitation email to be sent to you in November. u

*Darin Milner is Director, Risk Management Solutions, Dun & Bradstreet Australia and New Zealand.

Legal

No short cuts on standards of evidence SANDRA MCGUINNESS v ACM GROUP LIMITED (ACN 127 181 097) [2015] VSC 216 By Wojtek Randla* Snapshot zz A recent case in the Supreme Court of Victoria, on appeal from the Magistrates’ Court of Victoria, considered the respondent’s standard of evidence in proceedings for the recovery of credit card debt. zz Riordan J set aside the judgment of the Magistrate and dismissed the respondent’s claim identifying several weaknesses in the respondent’s evidence relating to assignment of the credit card debt, terms and conditions of the credit card, and the application of the interest rate and penalty charges. zz In absence of the document itself, a party may produce evidence of the contents of the credit card contract by adducing it from a witness pursuant to section 48(4) of the Evidence Act.

Wojtek Randla

In the recent decision of Sandra McGuiness v ACM Group Limited [2015] VSC 216, Riordan J of the Supreme Court of Victoria, ordered that the final order of the Magistrates’ Court in matter number D11054960 (‘Magistrates’ Court Proceedings’) made on 7 March 2014 be set aside and the claim be dismissed1. The Magistrates’ Court Proceedings were brought by the respondent against the appellant for nonpayment of a credit card debt. On appeal, Riordan J was required to deal with issues relating to matters such as: 1. whether the finding of the appellant applying for a credit card was open on the evidence; 2. the admissibility of secondary evidence of the contents of a credit card contract; 3. the adequacy of proof of applicable terms of a credit card, including proof of interest and other charges; and

4. whether the Magistrate ensured a fair trial for a self-represented litigant. On a broader level, the decision can be seen as the courts reluctance to simply accept secondary evidence, and/or infer evidence, on one or more aspects of a plaintiff’s claim, particularly when the evidence is not overly strong at first instance.

Background In November 1993, the National Australia Bank (‘NAB’) issued a NAB Gold Rewards Visa Card (‘Credit Card’), account number 4557 0168 3700 5714 (‘Account’), in the name of the appellant. The appellant used the Credit Card from time to time between 1993 and December 2007. In or about late December 2007, NAB issued a statement addressed to the appellant for a Credit Card for the period 24 November 2007 to 24 December 2007. The statement identified the unpaid balance at $28,408.25.

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Legal

On or about 19 March 2008, the NAB assigned the debt due under the Credit Card to Accounts Control Management Services Pty Ltd, which in April 2013 then assigned the debt to the respondent. By a complaint filed in the Magistrates’ Court Proceedings on 15 April 2013, the respondent claimed from the appellant the amount of $28,408.25 plus interest and late fees of $42,419.88, being a total of $70,828.13. On 7 March 2014 the Magistrate entered judgment in favor of the respondent for the sum of $70,828.13 plus costs of $12,107.00 (‘Judgment’).

i. had itself any rights under the Credit Card ‘contract’ to recover interest and/or penalties from the appellant; and ii. could assign any rights to recover interest and/or penalties from the appellant to any third person such as the Respondent; c. that the appellant had personally requested the Credit Card contract; and d. that the Appellant had notice, constructive or otherwise, of the ‘Conditions of use for credit cards’ or any subsequent variation of such terms and conditions.

Grounds for appeal By an Amended Notice of Appeal dated 15 May 2015, the appellant sought to have the Judgment set aside and the respondent’s claim dismissed. In summary the appellant’s grounds for appeal were inter alia: 1. that in making her decision [the Magistrate] failed to take into account that the respondent had the burden of proving that: a. by application in March 1993, the appellant personally requested to enter into an agreement with the NAB for the Credit Card (also hereinafter referred to as the ‘Credit Card contract’ otherwise described as the ‘Loan Facility’ in the decision); b. the respondent had actually given notice to the appellant of the ‘Conditions of use for credit cards’ in operation in March 1993; c. the NAB could unilaterally assign any of its rights under the Credit Card contract to any third person such as the respondent; and d. the respondent could charge penalties and/or interest on $28,408.25 in accordance with the terms of the Loan Facility terms as at the date of the initial assignment on 19 March 2008; 2. in making the said decision, the Magistrate took into account the following irrelevant considerations: a. that an application for an increased limit (identified as the 2001 Variation Application) was evidence of an application for an increased limit of the Credit Card; and b. an aide-mémoire prepared by the respondent that purported to calculate the sum of $70,828.13 of which $42,419.88 was said to be for interest and/ or penalties, as evidence of the actual damages recoverable from the appellant; 3. there was no direct evidence substantiating several aspects of the respondent’s claims including inter alia: a. NAB’s right to assign the Credit Card contract to any third party; b. that the first assignee [Accounts Control Management Services Pty Ltd]:

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

Decision By judgment dated 10 June 2015, Riordan J found in favor of the appellant and made an order setting aside Judgment and dismissing the respondent’s claim. Riordan J handed down a 37 page decision in which he cited the following reasons for his decision: 1. the Magistrate erred in finding that the 2001 Variation Application was ‘applicable to’ the Credit Card in so far as: a. there was no evidence from any witness that the 2001 Variation Application related to the Loan Facility; and b. it was not put to any witness or to the court on behalf of the respondent that the 2001 Variation Application did relate to the Credit Card; 2. the Magistrate erred in admitting evidence of Mr Zhao [a Senior Associate employed by the NAB], about the appellant applying for the Credit Card, in so far as he: a. did not have nor could not produce the appellant’s application for Credit Card or any supporting documents; b. was not familiar with the making of records relating to the Credit Card seeing that he had only been an employee of the NAB for the last 6 years; and c. the respondent failed to adduce evidence2 from Mr Zhao as to the contents of the documents relating to the Credit Card in question which were unavailable (principally the application and ‘Conditions of use for credit cards’ in operation in March 19933); 3. it was not open for the court to infer that the appellant enter into an agreement with the NAB for the Credit Card based on the documentary evidence and the evidence of Mr Zhao; 4. the Magistrate erred in finding that the terms of the Credit Card were proved seeing that: a. Exhibit B described as “Conditions of use for credit cards published by the National Australia Bank effective from 01/12/93 for the period until 31/10/96” (‘Conditions’) could not have been applicable to the Credit Card that was issued 11 March 1993; and

Legal

b. in cross-examination Mr Zhao could not confirm why the Conditions would apply to the Credit Contract; 5. the Magistrate erred in finding that the respondent was entitled to interest and “late payment fees” under the Credit Card contract seeing that: a. the respondent could not produce NAB’s Schedule to the Conditions; b. the respondent did not produce any evidence as to the interest rate or rates or any evidence of late fees; c. the court should not infer the interest rates from the evidence of Mr Vieira, the National Manager of Operations for the respondent on the basis that Mr Vieira: i. was not an employee of the NAB; and ii. did not disclose the basis of the calculation.

Further observations in the decision Riordan J also made three interesting observations in his decision which should resonate strongly with banks and debt management companies seeking the auspices of the judiciary in similar type proceedings: 1. firstly, that the court will not hesitate to insist on ‘best evidence-rule’4 in assessing secondary evidence tendered by a party; 2. secondly, he was surprised that a bank would not have retained documents past the statutory implied period of seven years seeing that the bank has “facility to retain mortgages and other contractual documents for longer periods of time”5 and that it “would destroy documents which evidence the terms of a continuing trading relationship without even retaining a copy”6; and 3. thirdly, the presumption of regularity should not be applied in circumstances where a party is claiming interest on an account particularly when “a very favourable inference is sought to be drawn by reason of the respondent’s failure to produce”7 evidence of the said interest rate.

This decision should prompt trade creditors to review their own debt recovery practices to ensure that any recovery proceedings they intend to take are not plagued by the same issues the respondent suffered in these proceedings. through the particulars of your claim and producing the evidence in support of those particulars; 2. ensure that any witness chosen to give evidence has the practical knowledge to comfortably depose as to the practices and procedure engaged by the company in commercial transaction (this employee should be at mid-senior level and have specific competencies and training relating to your credit procedures); 3. If the company is an assignee of a debt, ensure that it can clearly demonstrate: a. the assignor’s right to assign the debt; b. the terms of the assignment (normally contained in a deed or agreement); and c. that the debtor has received written notice of the assignment; 4. Particularise interest calculations, especially in circumstances where the plaintiff intends to charge a contractual default rate as opposed to a statutory or prescribed rate. u

What does this mean for creditors generally? The decision reinforces the courts position on proceedings premised mainly on inference. In a market which over the last 20 years has seen a proliferation of regulation and selfrepresented litigants, trade creditors need to be smarter about how they record commercial transactions. This decision should prompt trade creditors to review their own debt recovery practices to ensure that any recovery proceedings they intend to take are not plagued by the same issues the respondent suffered in these proceedings. To achieve a more robust practice trade creditors can start by: 1. reviewing their document management process to ensure that original documents are imaged, stored, and can be accessed quickly for referencing – often disputes can be settled promptly by taking the debtor

*Wojtek Randla is a Legal Practitioner Director & Litigation Manager for Baycorp – Australia. Phone: (02) 9806 2598, www.baycorp.com

FOOTNOTES: 1 S CI 2014 01340 2 Under the auspices of s. 48(4) of the Evidence Act, a party may adduce evidence of the contents of a document in question that is not available to the party, or the existence and contents of which are not in issue in the proceeding, by (a) tendering a document that is a copy of, or an extract from or summary of, the document in question, or (b) adducing from a witness evidence of the contents of the document in question 3 The ‘unavailability of the documents and things’ is defined by clause 5 of Part 2 of the Dictionary to the Evidence Act 4 At paragraph 16 5 At paragraph 27 6 ibid 7 At paragraph 40

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Legal

Statutory Demands: Beware of grabbing the tiger by the tail By Bill Andrews*

The Corporations Act 2001 (Cth) (Act) allows a creditor to serve on a debtor a ‘statutory demand’ to pay a debt within 21 days, or risk the creditor applying to the appropriate court for orders that the debtor be ‘wound up in insolvency’. The statutory demand has served for many years as a quick, cheap and effective way of recovering a debt, provided it is in the correct form and is properly served on the debtor company. And there are two further provisos: zz The first is that there should be no genuine dispute about the existence or amount of the debt.

“The statutory demand has served for many years as a quick, cheap and effective way of recovering a debt, provided it is in the correct form...”

Bill Andrews

In fact, the Act requires that, unless the claimed debt is a judgment debt, a creditor must accompany the demand with an affidavit declaring that the creditor knows of no genuine dispute regarding the debt. zz The second further proviso is that there should be no ‘other reason’ that the demand ought to be set aside by the court. The Act permits an alleged debtor to approach an appropriate court for orders setting aside the demand, with costs, if any of the above provisos is breached.

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

A case to consider In a case decided in May this year, In the matter of AAP Investments (Aust) Pty Limited (AAP), a creditor learned to its cost in the Supreme Court of New South Wales that issuing a statutory demand without attention to the two further provisos was rather like grabbing a tiger by the tail and not letting go when it had the chance. In that case, AAP had received a bill of costs in November 2014 from its solicitors (B&C) regarding complex legal matters for which B&C had been retained. The Legal Profession Act 2004 (NSW) provided machinery for AAP to seek an independent assessment of its bill, and AAP (through another lawyer) informed B&C of that intention towards the end of November 2014. In fact, AAP had not commenced the assessment procedure by the onset of Christmas 2014 and B&C proceeded, between Christmas and the New Year, to issue proceedings in the District Court of New South Wales to recover its claim as a debt. AAP failed to file a defence in time and a default judgment was entered in favour of B&C in early February 2015. Immediately afterwards, B&C obtained a garnishee order directed to AAP’s bank for payment of the judgment debt, and AAP commenced injunction proceedings to restrain that action. At about the same time, AAP’s lawyer was writing to B&C, pressing APP’s claim for assessment. It was in this disputatious context that B&C issued and served its

Legal

Costs consequences

statutory demand, based on the unpaid judgment debt. Because the debt was a judgment debt, there was no requirement under the Act for B&C to serve any affidavit stating that B&C believed there was no genuine dispute. Within days, AAP applied to the District Court to set aside B&C’s default judgment so that it could defend B&C’s claim, and AAP’s lawyer wrote to B&C asking that the demand be withdrawn. B&C declined to take that action and AAP then applied to the Supreme Court, within the permitted 21 days, for the demand to be set aside. Before the matter came before the Supreme Court, the District Court set aside the judgment on which the demand depended. Nonetheless, B&C chose to defend its position on the basis that there could not be a genuine dispute about the bill of costs because of the clear terms of the costs agreement and the detailed nature of the bill. The Court gave no credit to that argument. The demand was based

on the District Court judgment, now gone, and not on the claim underlying the judgment. Once the judgment was set aside, there was no scope for considering the underlying claim in order to decide whether or not there was a genuine dispute. But ultimately, the Court found that there was no need to decide whether there was a genuine dispute. It was sufficient to rely on the “some other reason” proviso to set aside the demand. Demands based on judgment debts have commonly been set aside under that proviso because of pending appeals. In the AAP case, the Court found that the matter was even clearer because, as at the time the matter was being decided, the judgment in question had already been set aside. In those circumstances the failure to pay the judgment debt could not reasonably give rise to a presumption of insolvency. The Court duly ordered that the demand must be set aside even though there had been a judgment in place at the time the demand was issued.

The Court then turned attention to the costs consequences of that outcome. In the usual course, ‘costs follow the event’: that is, the successful party is entitled to its costs either on ‘the ordinary basis’, or on the ‘indemnity basis’. In this case, B&C argued that, since it was entitled to issue a demand on the basis of an existing judgment debt, then it should have the benefit of costs up to the date that the default judgment was set aside, and that the parties should pay their own costs thereafter. However, the Court took the view that B&C should have known that it was inherent in any default judgment that it may be set aside, and that was a risk a creditor had to take into account in issuing a statutory demand. Furthermore, it should have been clear to a creditor in the position of B&C that, once the default judgment had been set aside, the demand based upon it was likely also to be set aside. Accordingly, the Court decided that B&C should pay AAP’s costs up to the date the default judgment was set aside on the ordinary basis, but after that date on the indemnity basis.

Conclusion The lessons to be learned from this case are clear: a creditor should issue a statutory demand only when it is objectively apparent that there is no dispute at all about the existence or amount of an alleged debt, and that reliance on a default judgment, when the creditor knows that the claim nevertheless remains disputed, is unwise. u

This article is intended as a source of information only. No reader should act on any matter without first obtaining professional advice. *Bill Andrews is Senior Associate for Bartier Perry. For more information please contact: David Creais, Executive Lawyer, Bartier Perry T: 02 8281 7823, E: dcreais@bartier.com.au

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Software and Technology

Leveraging the future to improve credit and collections – are you a leader or a laggard? By Steve Mitchinson* The evolution of customer management has been dramatic in recent years, yet overall the area of receivables management has proven to be a laggard in terms of adopting and implementing more efficient and effective solutions. Customer attitudes are evolving at a rapid rate and rising customer expectations create new credit and collections challenges. For a generation the Business to Customer (B2C) segment has been going through massive transformation acknowledging the rapidly changing expectations of customers. Some may argue that this is now evolving to the era of Business to Me (B2Me) – one that recognises that customers expect you to know who they are, what their value is to your organisation and to

Steve Mitchinson LICM

understand what their current and future circumstances and needs are. At the same time Business to Business (B2B) leaders have been pursuing similar efficiency and performance gains to those achieved in the B2C environment, albeit at a slower rate. Much of this transformation is reliant on accessing digital advancements, however, when assessing technology solutions and the collections process, it is often difficult to know where to begin and where to stop because the possibilities are virtually endless. Many enterprises are under significant pressure to both reduce operational costs and improve performance, yet many commercial enterprises continue to handle the collections and risk management processes using mail/email, spreadsheets, and paper. This process often requires access to multiple systems and interactions between departments. Manual investigation involving multiple groups may be required if a customer contests a decision, charge or invoice. Receivables management’s three most expensive inputs are often referred to as the three P’s – people, paper, phones all of which can be significantly improved by embracing the future. Whilst credit scoring has been an essential risk management tool

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

for decades in the credit field, particularly in the B2C market, the range of data sources both internal and external that continues to emerge can take this to a much higher level. So why is it that enterprises are not investing in the rapidly increasing range of opportunities presented? On the receivables management side, there are even greater opportunities that offer substantial opportunities to develop behavioural analytics to drive more effective collection programs. Much of the functionality deployed to take Call Centres (cost-cutting initiative) to Contact Centres (strategic customer management initiative) is ideally suited to driving greater efficiency and effectiveness across the credit life cycle, yet many enterprises are laggards in terms of adoption. Having been immersed in this space for nearly 20 years I take these capabilities for granted, and so in recent times as we see an increase in enterprises seeking support in the more effective management of their credit functions it is essential that all credit leaders understand and preferably pursue many of these opportunities. Recent research by the Aberdeen Group has highlighted the substantial difference in performance in both accounts payable and accounts receivable between enterprises

Software and Technology

that are embracing technology and efficiency advances and those that are not. We believe that one of the reasons for this low take-up in some sectors is indeed a lack of understanding of the capabilities available, the true cost to implement and benefits achievable. It would be quite easy to fill this magazine with a description of all the opportunities that are available, however in the contexts of this article I have highlighted below what we believe to be the top 10 opportunities for the credit industry to embrace in order to deliver more effective outcomes more efficiently. The opportunities are: 1. Behavioural analytics to drive effective collection cycles and programs. A scientific modelling approach pulling together everything we know about the debtor allows us to profile far more than just the risk rating of debtors. Being able to use your organisation’s customer and collections database to create Customer Segmentation and develop customer response segmentation can be a powerful advantage. We all know different customers will respond differently to contact

Can Pay

ABILITY

$

$

$  Will Pay

channels but we don’t always apply this knowledge in a scientific way. Once a debtor has been profiled, a campaign can be implemented to manage them based on much more holistic criteria. This simple 4 box matrix extracted from Collections, A Best Practice Guide by Serco is a simplified example – see diagram below. We know different customers have a different propensity to churn and so we typically have different customer retention strategies. So why, when we know different customers have a different propensity to pay do we mostly use the same rules and methods despite these differences. Behavioural scoring will enable a more proactive approach to collections and ensure that we apply the most effective approach to each customer. Once the propensity models have been built for each customer (or customer segment) they can be treated differently. This includes the timing of the collections activity, the channel used and the severity of the approach. For example alternative campaigns with different steps and methods might be:

INTENTION

Won’t Pay

Collections Campaign Development

Reminder Service Use of TXT/SMS No Action

Hardship

$

Debt Sale/ Mercantile Agency/ No Action

Can’t Pay

zz Campaign 1 (high propensity to pay) zz Campaign 2 (medium propensity to pay) zz Campaign 3 (low propensity to pay) A more advanced approach to campaign management may be seen in Table 1 (see over page). It is also important to match any segment analysis with operational performance and cost in order to further evolve the capability and effectiveness of outcomes. 2. Automated and/or Interactive Messaging – The use of interactive messaging that is often automated and enabled by deployment of the opportunity above allows customer behaviour triggers to trigger messages, and customer responses, to the SMS to initiate the next phase in the collection cycle. Similarly speech based IVRs can allow debtors to interact, perhaps whilst saving face, and can include the option to be connected to a collections officer as part of the transaction. It can also enable ”right officer” routing – while retaining efficient work practices, the collections team should use right officer routing to find a balance between transactional and relationship collections. In deploying the methodology you can: zz Route a previously called debtor back to the same Collections Officer zz Ensure a more difficult collections call is sent to a suitably experienced Collections Officer zz Not miss wasted opportunities when the nominated officer is not available 3. Automation of payment options and payment arrangements – Something that was embraced wholeheartedly by the B2C market place 15 years ago is only now gaining substantial traction in the commercial market place. Given the rapid transformation of the market place to a dominance of SME’s this is

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Software and Technology Table 1 Model

Result

Technique

P (contact, no contact, the message)

The likelihood that an attempt will turn into a contact by time of day and day of week, given the customer’s contact history

Data analysis, predictive model

P (promises given contact)

Probability that a contact will result in a promise

Data analysis, predictive model

P (payment given promise)

The likelihood that a promise will result in payment received

Data analysis, predictive model

P (payment given NO promise

The likelihood that payment will come in without contact given the time that has elapsed since the last cycle

Data analysis, predictive model, simulation model

Distribution of customer rolling to a better/ worse condition given payment

Expected next cycle risk segment of the delinquent customer given a payment received

Data analysis, statistical model

Distribution and customer rolling to a better/worse condition given no payment

Expected next cycle risk segment of the delinquent customer given NO payment received

Data analysis, statistical models

Source – Interactive intelligence Collection Trends Webinar

becoming critically important as many SME’s behave just like consumers, particularly in the service sector. 4. Voice or call recording – Has developed into contact centres under the guise of “training and coaching purposes” it is much more than that. With the right terms and conditions in place, the use of voice recording of conversations between debtors and creditors for proof can avoid the lengthy paper trails and can have a very positive effect on collection cycles and outcomes and indeed the initial credit granting process. 5. Speech analytics (in real time) is one of the most exciting technology advances in the area of customer management in recent years. Being able to analyse customer calls in real time is an incredibly powerful tool not only for achieving more positive outcomes during the call but also for driving improved effectiveness of team members and ensuring that all interactions are delivered in accordance with accepted standards. Results being achieved already by the early adopters in customer service and sales channels are quite staggering and there is no reason why the same can’t be achieved in the credit area. To have customer

conversations in a digital format can also play a vital role in further enabling the opportunities presented by detailed data analytics to improve collection effectiveness. 6. Enhanced reporting for workplace performance and results. This includes the development of more effective KPI’s and reporting frameworks using the broader range of data that is now available to the Credit Department. The reporting of credit performance is still dominated by lag indicators. The term lagging indicator refers to measurements that reflect what customers have already experienced or what the business has achieved – they are a bit like rear vision mirrors. By contrast, a leading indicator reflects what you are doing in advance of customers experiencing it. They are a bit like the GPS giving your directions along the journey. Lagging indicators are important big-picture measures of achievement, but they are not prescriptive, and therefore they are not actionable. Leading indicators are internal operational measures that empower teams by letting them see a direct connection between their work and its outcomes (which are the lagging indicators). In much the same way as

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

customer management KPI’s have evolved from operational metrics to outcome metrics, in recent times there is a strong argument that traditional measures within the credit environment also need to be reconsidered and supplemented by such measures as: zz Right Party Contact (RPC) RPC/ File Dialler Management zz Promise to Pay (PTP) or call Efficiency PTP/RPC Officer/Team Leader zz PTP Effectiveness (Kept Rate) Payments/PTP Officer/Team Leader zz AHT Total Activity Time/Calls Officer/Team Leader zz Quality As per the Quality Scorecard by Officer/Team Leader zz Collection Efficiency – $ Collected/ $ Available by Officer/Team Leader zz DSO Velocity Index With advanced analytics: you know... so you can calculate – see Table 2. 7. Real time performance dashboards. Again we need, in this high-speed world, to be tracking and responding to performance in real time not after the event where all too often the opportunity has been missed. Every one of us operates in a far more competitive world than we

Software and Technology did years ago. Products and services are less differentiated and so the efficiency with which we undertake our administrative activities is having an increasing impact on the overall performance of the enterprise. Being aware of performance as it happens is a key to improvement. 8. Software as a service. For many years the cost of replacing incumbent systems has been used as an excuse not to embrace digital opportunities. Not only has a typical cost to modernise reduced dramatically, but the increasing emphasis on and opportunity to move, expenditure from capital expenditure to operating expenditure makes the use of software as a service a compelling opportunity in many circumstances. It also helps alleviate the risk of getting it wrong. 9. CRM integration/desktop optimisation. Many enterprises still try and collect using legacy billing systems – the old green screen of death! In today’s connected world you simply can’t expect a new (and likely young) collections officer to tab between billing systems and type specific commands during a collections call. Many legacy systems are cumbersome and lack the intuitive GUI interfaces that are present in just about every

other aspect of their dailylife. In these legacy systems, agents are often required to make notes in multiple places, and handle times can be long. There is abundant research showing a link between staff tenure and the technology used to perform the job so if you want to keep the best and the brightest you need to invest. The agent must be in the right state of mind and be able to focus on the conversation when they speak with customers. Asked to use a poor quality or inflexible interface, agents often get irritated, and the customer is likely to sense their irritation, and a poor quality interaction or outcome may result. Integration of data from many sources is necessary to provide the holistic and real-time view of account information that credit and collection officers require to do their jobs effectively. All too often staff are required to interact with multiple systems and screens in order to facilitate transactions with the customer. The ability to provide a simpler intuitive interface for staff is proven in a number of industries and environments to dramatically improve productivity and efficiency. Indeed there are software development companies found on the sole premise of providing an improved user interface for some of the world’s largest core systems.

Table 2 You know…

…so you can calculate

Contact history, probability of contact, left message, non contact

Number of contacts you expect if you prescribe a series of contacts

The number of contacts you expect

The number of promises you would expect

The number of promises you expect

The number of payments you would receive

The number of payments received, balance, payment due, and the probability of a payment without a contact

The marginal payment amount associated with making a calling attempt to that customer

The expected payment amount

Expected risk profile for the next cycle Marginal account role rates Marginal dollar role rates Marginal delinquency by bucket

Expected risk score for next cycle and expected role rates for next cycle

Change in charge-off exposure due to an attempt

Collections expense

The cost of an attempt

10. Automated and/or predictive outbound dialling. Outbound calling is acknowledged as typically the most effective collection method, but it is also one of the most expensive due to the manual effort and inefficiency. Once the domain of those annoying, anonymous dinner time callers we all experience after a hard day at the office, automation of outbound dialling integrated with core billing and customer management systems is one of the greatest efficiency opportunities available to the credit community. As we all know one of the great challenges of outbound dialling is the strike rates, and in the consumer world using manual dialling methods it is not unusual for a strike rate of one in five call attempts. Effective dialler management uses historical dialling information to better target current debtors and uses past dialler information at a debtor level to determine when that debtor should be called (assuming it was a successful contact) and avoids the time wasted when encountering answering-machines and voice mail systems. This can drastically improve officer utilisation, reduce unnecessary telephony costs and typically accelerate cash flow. In summary, today’s broad range of technologies enable receivables departments to: zz Increase receipts from collections activity zz Be more responsive when there are complaints zz Prevent or reduce the risk of important actions falling through the cracks zz Better assess the marginal economics of a collections campaign before the campaign begins zz Improve the quality and timing of decision-making zz Improve employee enablement and engagement zz Lower operating costs u

*Steve Mitchinson is a Director – AICM and Director of BBB Advisory. Visit www.bbbadvisory.com.au

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Software and Technology

Digital B2B payments help rid businesses of red tape but some still struggle to cut out paper – Deloitte report By Richard Miller* Commercial organisations of all sizes are under continued pressure to improve efficiency and effectiveness. Both accounts payable and accounts receivable functions are critical to efficiently managing these cash flows which are the lifeblood of the business. This is especially true for businessto-business (B2B) payments which represent the majority of commercial expenditure. Suppliers seeking a condensed accounts receivable cycle as well as improved and more predictable cash flow are providing a growing acceptance base for

Richard Miller

buyers to depend on digital and card payments as their primary payment instruments. Although digital payments provide considerable benefits to Australian organisations many have yet to make the switch to realise the potential. This was the finding from a Deloitte survey of 150 medium and large organisations (67% in Australia and 33% in New Zealand) to ascertain key B2B payments metrics and trends.

Results The results published in the Deloitte report, ‘B2B Payments: 2015 Australia and New Zealand Research’ indicate that digital account-based payment mechanisms are typically considered better, faster and cheaper by organisations that use them. This is driven by business process benefits such as improved cash flow, less administration and reduced time chasing payment or reconciling invoices. As well as the speed improvements due to digitisation or reduced approval steps and the cost savings including lower transaction and total process costs. The research also found that organisations are increasingly driving towards electronic means of payment as well as experimenting with different tools and providers to add value through data analysis and cash flow visibility.

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

The ability to leverage data moves the accounts receivable function from a tactical administrative processing role to acting as a partner to the financial managers in the company. This shift drives efficiencies in multiple areas including inventory planning and stock supply management, production capacity planning and the optimum use of working capital facilities from banking partners. By using digital solutions that are focused on working capital benefits such as single use accounts, virtual accounts and payment platforms, the gap between physical purchasing cards and trade finance products gets bridged. An important feature of the B2B Payments study was the inclusion of the supplier and accounts receivable perspectives as past research has tended to focus on buyers and accounts payable. Among other insights the research identified that suppliers share many of the same benefits from using cards as buyers.

Collaboration Banks, payment technology companies and fintechs are increasingly working together to bring digital solutions to market to improve the whole process of making or receiving payments. New technologies, often brought to market initially by innovative

Software and Technology

fintech companies, are beginning to change the way payments are being made and received. Businesses and government organisations are increasingly looking to such digital solutions to improve productivity and reduce the time between invoicing and receiving payment. When it comes to being paid 73% of the survey respondents rated faster payment as an important benefit of accepting digital payments, with 49% saying that cards reduced the cost of doing business.

There was a ‘but’ … However suppliers also share the same misconceptions about cards and buyer preferences which can hamper adoption. Suppliers that accept card-based payments highlighted a number of important benefits, with more than half citing: zz working capital improvements through faster payment zz cost savings through reduced processing effort zz administrative simplification resulting from improved reconciliation. In addition to these benefits 45% of suppliers reported an increase in sales volume once they introduced card acceptance for B2B payments. Less tangible but in some cases even more important was the improved customer relationships that could develop through better integration with buyers’ processes. Digitising payment processes can provide benefits to both suppliers and buyers but it does require both sides to work together. While the working capital benefit of card-based transactions has a positive impact on buyers’ cash flow, the speed of card transactions can have a more direct and significant impact on suppliers. Seventy three per cent of the surveyed group cited improved cash flow as an important benefit of accepting cards for payments.

A survey respondent said: ‘Digital B2B payments are great for cash flow and great for us: less paperwork, less mistakes in the process, better reporting.’ With payments authorised in realtime, and typically settled in less than two business days suppliers have observed better control over their receivables with tangible benefits for the business. Almost half of the respondents in the Deloitte survey reported a decrease in overall business costs as a result of accepting card-based payments. Electronic payment mechanisms like cards also tend to reduce manual intervention and reconciliation effort. Together with better data and analytical insights this can significantly improve the operational performance which can in turn offset the merchant service fee paid to the acquiring bank. There was also a perception that buyers ‘do not want to pay by card,’ which suggests a ‘disconnect’ with the perspectives reported by buying organisations in the study. In fact, buyers using card solutions wanted to further increase their use, including being willing to absorb some of the cost of acceptance, in return for faster payment such as that through discount.

…the ‘but’ is being addressed Suppliers also often viewed cards as a consumer-focused mechanism, indicating that the amounts being transacted were not appropriate for cards. In response to growing demand for large transactions Visa has raised limits, making card-based B2B transactions up to US$10M in value now possible. Another concern was the merchant service fee associated with a card transaction. This was often

regarded in isolation, not accounting for the overall process cost and potential for reducing operating costs, such as staff, postage, stationery and banking fees. Nor did it consider the potential upside of accepting cards on the top line. There are a number of challenges in implementing and optimising digital payment programs, including the effort involved and initial cost, which can be exacerbated by a limited understanding of benefits. Like any process and organisational change implementing a digital payment program requires a well-managed effort to succeed. The study interviews indicated that opportunities exist to improve both the initial implementation of such programs as well as the need to optimise their on-going operation. To assist organisations manage this Deloitte developed a manual of best practices to implement and manage card-based payment solutions. However there is still considerable opportunity to improve take-up with almost half of survey respondents (47%) not using the available solutions and 100% still having paper processes to support cheque payments. According to Visa, a key technology partner for banks across the region and sponsor of the Deloitte report, the future is about digitising processes and creating an integrated view across a portfolio of mechanisms often through innovative tools developed by fintechs. u *Richard Miller is Payments Director for Deloitte. For further information on the report or optimising B2B payments, contact Richard at: rimiller@deloitte.com.au

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

Software and Technology

The evolution of banking in Australia By Amaran Navaratnam*

“In years to come we will all have a story to tell our children of when we had to wait in line at the branch for 20 minutes patiently watching the flip clock.”

Amaran Navaratnam

For most Young Credit Professionals of Australia (YCPA) our first banking experience started with a Commonwealth Bank Dollarmite savings account, we were excited about the moneybox rather than the saving aspect. As we matured into adolescents so did the banking experience. In years to come we will all have a story to tell our children of when we had to wait in line at the branch for 20 minutes patiently watching the flip clock. The reaction will be priceless given what their first banking experience will be. Technology and innovation was revolutionary in the late 2000’s driving us to the ‘Mobile Commerce’ generation with the ability to pay bills, do our internet banking and open new accounts simply with the use of our mobile. Something we definitely could not do on a Nokia 5110. Since 2009 we have all felt the strong presence of digital marketing and online shopping. What did the banks do to cater for our online shopping obsession? They admitted the ATM card for plastic surgery! We now refer to it as a ‘Debit Card’ with its new appearance, rewards programs and greater security with the ‘Europay MasterCard Visa’ (EMV) chip making online purchasing easier using our own money. The Australian Bureau of Statistics have reported in 2009 that online retail sales totalled $24 billion with the most popular purchases being travel and accommodation. In recent years with apps such as Groupon, daily deals, RedBalloon and other sites there is no need to be stalking for a

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

car park during Christmas week, as we can shop online. As our debit and credit cards evolve so do the payment methods. Over the last 5 years PayPass and PayWave have made us wave goodbye to signing for retail purchases. In years to come I am sure we will soon be farewelling the PIN. Our cards will always revisit the surgeon for a ‘nip and tuck’ to keep up with customers evolving needs in a card with added benefits and tighter security. We have all experienced the gut wrenching feeling of leaving our wallet or purse at home and only realising half way to work. In 2015 Westpac and Commonwealth bank successfully launched its ‘Cardless Cash’ service enabling us to use our mobile banking app to withdraw money. If you leave both your phone and wallet at home then I hope the apple from the recent fruit box delivery is still on your desk as it seems this will be your replacement lunch. In the last 6 years our banks have flexed their ‘CANSTAR’ achievements through their innovation, products and services as rated by consumers. Some banks have invested over $500 million on innovation, behavioural science, analytics, digital software and social media platforms just to know us better. Smart move. Banks have tailored credit products and services to meet customer needs and wants. For example, our banks have increased their airline affiliations getting us closer to the departure gates in style by converting retail expenses

Software and Technology

“...we were excited about the moneybox rather than the saving aspect.” into frequent flier miles with added benefits such as lounge access and travel insurance. Flying like a YCPA should! Cricket fanatic or not we were all captured by the Commonwealth Bank advertisements on Facebook. Did they win me over? Yes. The advertisements flooded my newsfeed and I began reading cricket club stories then finding myself calculating my borrowing power. This is a perfect example of our banks innovative marketing strategies through the use of social media. The evolution of banking in Australia has been exciting but has it created a cause and effect for consumers leaving us now financially over committed? Sure, we can be faster than John Wayne to draw out our credit card when we see interest free deals online but can we repay this within the interest free period?

Putting aside the increase of cost of living in Australia, household debts have soared in recent years. The most worrying fact is that in 1990 the average household debt represented less than six months of annual income. That has now tripled to 18 months of annual income. The Australian Financial Security Authority of Australia reported in September 2014 that 3000 debt agreements were lodged within the demographic age of 18-24. I think it’s time for schools to begin educating students on credit consequences and safety sooner than later, don’t you? They are the future of the Australian economy. Who is to blame for all this debt? It is us, the consumers. Australian consumers in recent years have focused on satisfying more of the wants in life as opposed to the needs. Moving forward to 2020, Australian consumers will need to act

smart when it comes to credit. It is easy to fall into the trap of effective marketing strategies but we as consumers need to exercise careful judgement, rather than instinct. The greater the household debt increases in Australia the stronger the scent of a financial crisis gets. Is the lead up to 2020 in banking going to be evolutionary or revolutionary? Truth be told, it will be both. The banking sector will face greater challenges on how to win a greater customer base as they will continue to flex their innovations in response to the evolving forces of customer expectations, regulatory requirements, technology, demographics and shifting economics. How we as consumers contribute and handle the changes will determine the future of our economy. u *Amaran Navaratnam is Business Development Manager Assistant at Recoveriescorp. www.recoveriescorp.com.au

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

aicm Can We Help? AICM receives questions from Credit Managers that it puts to a panel of lawyers, insolvency experts and credit professionals to answer. The brief is not only to answer the question but to look into the root cause of the problem and contribute strategic thought. All articles contain general information only. They are not legal advice. You should seek your own legal advice if faced with a similar situation.

Trade references Question I was at a meeting of creditors the other day when the resolution to be considered by creditors was amended. The Chairman was not sure what he could do with all the special proxies, as they were casting a vote on a resolution which had changed. Were they invalid, once the resolution had changed, no matter how big or small the change? Were the special proxies still valid to the extent only that the amended resolution was not adverse to their position compared to the original resolution?

Question Answer

My company provides goods and services to other

Meetings of creditors are important in the insolvency

businesses ie all of my customers, be they a sole trader,

process because they allow creditors a say in decisions

partnership or company have provided me with their

that often need to be made. Creditors can vote by proxy

ABN and my goods are generally for business purposes.

if they are unable to attend, by way of a general or a specific proxy.

On which of my customers may I provide a commercial trade reference and to whom?

The nature of a specific proxy grants special power to

What are my obligations if I provide a commercial

the holder to vote in a pre-determined manner. Certainly

trade reference to another supplier of a customer ie:

they should not be used where there is a material

zz must I keep a copy of the reference, and if so for how

difference from the original resolution. The Chairperson, usually the insolvency practitioner, has the power to make determinations regarding the use of proxies and may adjourn a meeting for the purpose of investigating

long? zz must I divulge to the customer the fact I have provided a trade reference? zz must I produce a copy of the reference if so

a person’s entitlement to vote at the meeting. Any party

demanded by the customer?

aggrieved by the outcome of a meeting of creditors has

What are the obligations on the requesting party ie:

the power to apply to the court regarding the validity of

zz must he keep a copy of the reference?

resolutions.

zz with whom may he share the information eg internally,

It is important to note that if a resolution is put to a meeting of creditors which has not been included in the specific proxy, the holder of the specific proxy is entitled

externally? zz must he produce a copy of the reference if so demanded by the customer>

to vote as if the proxy was a general proxy. Chapter 24 of the ARITA Code of Professional Practice

Answer

gives guidance on the conduct of creditors meetings,

We will source an answer from some experts and provide

including proxies: 24.5.

their responses in the December issue

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

aicm Training News

Legal

2015 – 2016 Face to Face Training Calendar MELBOURNE

SYDNEY

17th & 18th November – Manage factoring and invoice discounting arrangements (E,D)

23rd November – Manage the credit relationship (C,D)

19th November – Manage the credit relationship (C,D)

24th & 25th November – Manage factoring and invoice discounting arrangements (E,D)

14th December – Process customer complaints and Conduct customer engagement (E,4)

11th December – Process customer complaints and Conduct customer engagement (E,4)

10th February – Implement risk management strategies (C,4)

18th & 19th February – Manage factoring and invoice discounting arrangements (E,D)

11th & 12th February – Manage factoring and invoice discounting arrangements (E,D)

10th March – Manage risk and Policies and procedures (C,D)

21st & 22nd March – Legal Compliance (C,D and 4)

11th March – Implement risk management strategies (C,4)

14th April – Personal Insolvency (C,D)

17th & 18th March – Legal Compliance (C,D and 4)

13th April – Manage overdue accounts (C,4)

21st April – Personal Insolvency (C,D)

18th May – Corporate Insolvency (C,D) 19th & 20th May – Manage factoring and invoice discounting arrangements (E,D) 21st & 22nd June – Developing your credit policy and procedures (C,D)

BRISBANE 10th & 11th November – Manage factoring and invoice discounting arrangements (E,D) 12th November – Manage the credit relationship (C,D) 7th December – Process customer complaints and Conduct customer engagement (E,4) 8th & 9th February – Manage factoring and invoice discounting arrangements (E,D) 24th February – Implement risk management strategies (C,4) 25th & 26th February – Legal Compliance (C,D and 4) 7th April – Personal Insolvency (C,D) 8th April – Manage overdue accounts (C,4) 9th May – Corporate Insolvency (C,D) 10th & 11th May – Manage factoring and invoice discounting arrangements (E,D) 8th & 9th June – Developing your credit policy and procedures (C,D)

22nd April – Manage overdue accounts (C,4) 23rd May – Corporate Insolvency (C,D) 24th & 25th May – Manage factoring and invoice discounting arrangements (E,D) 27th & 28th June – Developing your credit policy and procedures (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. Should you wish to receive a nationally recognised Statement of Attainment, you will be required to undertake the online assessment at completion of the face to face training. Please register your interest early, as there is a minimum requirement of 8 students to conduct face to face training.

Recent Graduates: Mark Beauchamps Cheryl Baird Callum Andrews Rahill Memon Long Truong Ellen Harraden Lauren Martin Rian Pask Karianne Menezes Steve White Carlo Razon Jason Hopkins Aneesha Hassan Zoey Suthers Wendy Johnson

Organisations that have undertaken in-house training: St George Bank Bank of Melbourne Westpac Bunzl Food Processor Supplies Baiada Australia Werner Co Australia (Manila Division)

Testimonial One of the benefits of belonging to AICM is that professional development is at our fingertips (just pick up the phone and talk to Debby or Nick). Consequently In an effort to ensure our offshore team was more effective and to ensure compliance, AICM came to Manilla. The subject matter was very relevant to the team’s day to day operations and was presented in a manner that reflected our process and procedures. My team gave the feedback that they have had a fun time which made the days enjoyable and learnt things that will help them perform the tasks required for their positions. Gloria Johnson | National Credit Manager/Supervisor Aust & NZ Werner Co Australia Pty Ltd.

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

aicm Training News What is your learning style? There are THREE basic types of learning styles. These are Visual, Auditory and Kinaesthetic. To learn we depend on our senses to process information around us. Most people tend to use one of their senses more than the others. The following questionnaire has been designed to help you identify your staff learning styles. This can be used as a tool when creating training plans for customised

organisational training as one style does not meet all participants’ learning needs. The questionnaire will help you identify which of these learning styles you and your staff rely upon the most. Read the questions and select the answer that most closely fits your answer. Do not think about the question too much; just go with your first choice.

Question 1: When you study for a test, would you rather

Question 5: To learn how something works, would you rather

A. Read notes, read headings in a book and look at diagrams and illustrations? B. Have someone ask you questions, or repeat facts silently to yourself? C. Write things out, make diagrams?

A. Watch a movie about it? B. Listen to someone explain how it works? C. Take something apart, and try and figure out how it works by yourself?

Question 2: Which of these do you do when you listen to music? A. Daydream (see things that go with the music) B. Hum along C. Move with the music; tap your foot, etc.

Question 3: When you work at solving a problem do you

Question 6: You have just entered a science museum, what would you do first? A. Look around and find a map showing the locations of various exhibitions B. Talk to the museum guide and ask about exhibits C. Go into the first exhibit that looks interesting, and read directions later

A. Make a list, organise the steps and check them off as they are completed? B. Make a few phone calls and talk to friends and experts? C. Make a model of the problem or walk through all of the steps in your mind?

Question 7: What kind of restaurant would you rather not go to?

Question 4: When you read for fun, do you prefer?

Question 8: Would you rather go to

A. A travel book with lots of pictures in it B. A mystery book with a lot of conversation in it C. A book where you answer questions and solve problems

A. An art class? B. A music class? C. An exercise class?

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

A. One that is too bright B. One that is too loud with chatter or music C. One with uncomfortable chairs

aicm Training News

Legal

Question 9: Which are you most likely to do when you are happy?

If you scored mostly A’s you may have a visual learning style. You learn by seeing and looking.

A. Smile B. Shout with joy C. Jump for joy

zz zz zz zz

Question 10: If you were at a party, what would you be most likely to remember the next day? A. The faces of the people, but not the names B. The names but not the faces C. The things you did and said while you were there

Question 11: When you see the word “DOG”, what do you do first?

zz zz zz zz zz

A. Think of a picture of a particular dog in your mind B. Say the word “dog” to yourself silently C. Sense the feeling of being with a dog

Question 12: When you tell a story, would you rather A. Write it? B. Tell the story out loud? C. Act it out?

Question 13: What is the most distracting for you when you are trying to concentrate? A. Visual distraction B. Noise C. Other sensations, like worry, stress or hunger

Question 14: What are you most likely to do when you are angry? A. Scowl B. Shout C. Slam doors or throw things around

Question 15: If you are unsure how to spell something, which of these are you most likely to do? A. Write it out to see if it looks correct B. Sound it out C. Look it up in a dictionary or use spellcheck on the computer

Question 16: What are you most likely to do when standing in a long line? A. Look at advertising B. Talk to the person next to you C. Tap your foot or move around in some way

Take numerous detailed notes Tend to sit in the front Are usually neat and clean Often close your eyes to visualise or remember something Find something to watch if you are bored Like to see what you are learning Benefit from illustrations and presentations that use colour Prefer stimuli to be isolated from auditory and kinaesthetic distraction Find passive surroundings ideal

If you scored mostly B’s you may have an auditory learning style. You learn by hearing and listening. zz You prefer to sit where you can hear but sometimes do not pay attention to what is happening in the front of the room zz Hum and talk to yourself or others when bored zz Acquire knowledge by reading aloud zz Remember by verbalising the lesson to yourself zz May not coordinate colours or clothing, however, they are able to explain why you are wearing what you are and why

If you scored mostly C’s you may have a kinesthetic learning style. You learn by touching and doing. zz You need to be active and take frequent breaks zz Speak with your hands and with gestures zz Remember what has been done but have difficulty recalling what was said and seen zz Rely on what you can directly experience or perform zz Activities such as cooking, construction and art help you perceive and learn zz Sit near a door or someplace else where you can easily get up and move around zz Are often uncomfortable in classrooms where you lack opportunities for hands on experience zz Often communicate by touching and appreciate physically expressed encouragement, such as a pat on the back.

The purpose of the quiz: zz To help identify your learning style and the learning style of your staff. zz To understand the difference between auditory, visual and kinesthetic learners zz To learn about different learning styles, to ensure that when you are delivering staff training you meet the needs of all learners.

December October 2014 • CREDIT 2015 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

New South Wales President’s Report “And the winner is SYDNEY”...welcome to all the delegates to this year’s conference, we hope you have a great time in our fantastic city and enjoy the great program that has been put together for this years conference. My council will be around to assist at the conference and look out for us in our nicely coloured AICM shirts sponsored by Byron Thomas Recruitment. Please take the time to come and speak to us about anything AICM or Credit related. You will notice our council has some new members and would like to welcome aboard Andrew Smith, Adam Clark, David Hunt and Anna Golubeva. Great to have you on board and looking forward to working with you all. These new councillors combined with more experienced councillors are all passionate about the AICM and helping to make it bigger and better than ever. We had a brilliant YCP gala event that saw Kimberly Hale of Baycorp take out this year’s title, we will be cheering very loudly for you at the Nationals “champ”, great job. I would also like to congratulate all the finalists. A report of the event is below. We are already busy working away at next years calendar so if you have anything you would like to see on there feel free to contact me or any of the councillors. Have a great conference to all those in attendance and look forward to saying g’day. – Col Magee MICM CCE

Young Credit Professional Awards Dinner On the 16th of July 2015 the NSW division held the annual Young Credit Professional Awards Dinner and I’m pleased to report that the evening went very well with more than 100 in attendance. The event was held at the Kirribilli Club which overlooks the Harbour Bridge and City of Sydney. Firstly, we would like to congratulate the 5 Young Credit Professional Finalists below: – Carlo Razon – Coates Hire – Christopher Lagana – Ricoh Australia – Cristian Nobili – USG Boral – James Cameron – CSR Limited – Kimberley Hale – Baycorp This year’s competition was as fierce as any I can remember and a special congratulations to Kimberley Hale, the winner of the NSW Young Credit Professional Award. Kimberly exhibits all the traits necessary to be a great ambassador for the AICM and will challenge for the national title in October. Thanks to all the national partners who support the AICM, and a special thanks to D&B for their ongoing sponsorship of the Young Credit Professional Award. There was a great speaker on the evening called Stephen Bock. Stephen Bock was the 61st Australian Summiteer, which we learned on the evening is to describe someone who has reached the summit of Mt Everest. Stephen was able to transport the room to the summit with him and I can remember feeling tightness in my chest thinking about the lack of oxygen at such a great altitude. Hollywood tends to portray Everest as glamorous however in reality it’s a gruelling marathon which takes on average 42

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

80 days from base camp to the summit and back. If this is something you may be interested in please feel free to contact Stephen on 0417 344 445 or email him at stephen.bock@raywhite.com. Stephen Bock attended our event to raise money for the tragedy that happened in Nepal. This is a cause that he is very passionate about – if you would like to donate or learn more about this please go to http://www.australianhimalayanfoundation.org.au/

NSW Council Grant Morris MICM CCE - NSW Councillor and National President Grant has been the National Credit Manager at Coates Hire for the last 6 years. He leads a team of 35 and his business provides a wide range of rental equipment to the building, construction, engineering, mining, manufacturing and event industries. He is passionate about the AICM’s CCE programme and 8 of his team have sat the exam, completed the assignment and attained their CCE. He enjoys travel especially where it involves following the Swans around the country or visiting his son and daughter in London.

Gregg Odlum MICM CCE – NSW Councillor and AICM Board member Gregg is currently the ANZ Shared Services Manager at Ecolab, leading the credit, payables, contracts and customer service functions at Ecolab, a global leader in helping the world deliver Clean Water, Safe Food and Abundant Energy. Ecolab is a corporate AICM member and the 13 members of the credit team are actively engaged in events and training conducted by the AICM. In his spare time (hardly any now he is a new dad) Gregg enjoys water skiing and shares his passion in this sport through various youth organisations.

Colin Magee MICM CCE – NSW President Colin has been in Credit for over 25 years and is currently the Service Delivery Manager at Downer Group. He has just attained his CCE, which has made him and his family very proud. He loves his mighty Dragons and officially has the youngest member of the red v in his 9-week old son Aaron. His six year old daughter Elysha has been a red v member for 6 years! He loves spending time with his wife Roberta (Bert) and young family and enjoys getting down the coast to get some sun, surf and relaxation when possible.

Sue Day MICM CCE – NSW Councillor – Membership Portfolio Sue has been the National Credit Manager at Manassen Foods Group for over 15 years. Manassen Foods Australia are a leading FMCG company. She leads a team of dedicated credit professionals who are as passionate about credit as she is. Sue has completed both the AICM Financial Diploma and the CCE program. She highly recommends the AICM nationally recognised education programs and says they certainly do offer great development paths for credit professionals whether they are starting out or experienced credit professionals.

New South Wales Why did you get involved on Council? I enjoy getting involved. I want to make a difference and give something back.

Patrick Coghlan Patrick has been with CreditorWatch since day 1 as one of three founding employees. He is currently the Commercial Director responsible for the sales, marketing and overall company strategy. He loves his sport (both watching and participating) and recently celebrated his 20th year as a Sydney Swans member. His greatest sporting moment was running with the Olympic Torch in 2000. How did you get involved in the credit industry and in what capacity have you been a credit professional? I fell into the industry as one of the founding employees of CreditorWatch, a credit reporting bureau. We have created an alternative option to the other credit reporting bureaus, providing access to unique data and more competitive rates. How long have you been involved with the AICM – on Council and other? I have been involved with the AICM for about 5 years now as a supplier/exhibitor. For the past 12 months I have sat on the NSW AICM Council, tasked with the Membership Portfolio. Why did you get involved on Council? The AICM is an integral part of the credit industry and I wanted to assist in growing its membership base and ensuring it maintained its relevancy. A lot of work goes on in the background and it shouldn’t just fall on the shoulders of a few people. What part of the world do you come from? Sydney, Australia. What is your favourite movie quote? “Don’t forget the cannoli!”– from the Godfather. What sport/team do you barrack for? Sydney Swans and Manchester United. What would you say has been your biggest success in your career? Turning CreditorWatch from a simple idea into a successful business that has two big companies on the back foot.

David (Dave) Hunt National Credit Manager at FUJIFILM Australia Pty Ltd, AICM NSW Council Member – Membership Portfolio How did you get involved in the credit industry and in what capacity have you been a credit professional? I started to do some book keeping for some friends operating small businesses to supplement my studies (Diploma in Business and a Diploma in Management) but found whilst doing this the biggest problem they were having was getting paid. This didn’t seem right to me, they were working very hard but yet couldn’t afford to pay their creditors on time because they were not being paid themselves. So I started chasing up their money and found while doing this that there were a number of other businesses in the same predicament. I set up my own collection company over 20 years ago and, as the say, the rest is history. How long have you been involved with the AICM? Over 5 years

What part of the world do you come from? Kia Ora, born in Wellington, the capital of New Zealand. What is your favourite movie quote? “Let the wild rumpus start”. Where the wild things are. What sport/team do you barrack for? The All Blacks because I like to support a winning team. What would you say has been your biggest success in your career? Pretty comfortable currently enjoying a senior role in a large corporate with almost complete autonomy. Just been elected as Treasurer with the Australian Credit Forum, Board member at Sydney Junior Rugby Union and really looking forward to getting involved with the AICM NSW Council.

Andrew Smith CEO and Founder of Australian Recoveries & Mercantile Agents, AICM Portfolio – Membership and Events How did you get involved in the credit industry and in what capacity have you been a credit professional? When I arrived back in Australia after 2 years living in London working in what most young guys would describe as their dream job which entailed promoting the sponsors for major sporting teams such as Ferrari, Manchester United, The English Cricket Team and The Wallabies. I had a massive reality check, as I was 23, back living with mum and dad in Newcastle with little idea of what I wanted to do with myself. Luckily our neighbour at the time was a lovely lady called Anne Hatton who just so happened to be the CEO of a large recruitment company called TMP. Anne told me I was good with people and should get into sales so she pulled some strings and got me an interview with D&B and the rest is history. How long have you been involved with the AICM – on Council and other? I started at D&B as a BDM back in 2003 and as a long time sponsor of the AICM and the YCP award, I quickly recognised the benefits of networking within the AICM events to further my understanding of the Credit Industry and develop my contacts and long term friendships. After a 4 year sabbatical at Experian, I returned to D&B for a second time (Some would say I’m a slow learner) to take up the position of NSW Sales Manager and as part of D&B’s sponsorship, I was given the opportunity to be a judge for the NSW YCP in 2009/2010. I’m proud to say I was a big supporter of Gregg Odlum who won the NSW Award and backed it up with the National Title, that was despite the fact he wore a 3-piece suit and had the shiniest shoes I had ever seen in my life. Since leaving D&B almost 5 years ago, and starting my own business, I have become joint naming day sponsor for the NSW AICM Golf Day since its return to the AICM NSW calendar 2 years ago. I am also the self professed head of the AICM mafia which has a number of other members who shall not be named at this stage, who are all as passionate about the AICM as I am.

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

Getting to know:

AROUND THE STATES

New South Wales Why did you get involved on Council? It was time I started giving back to an organisation that has played such a critical role in my success within the industry. Without the experience and networks I have developed through the AICM I would not be where I am now. In addition the AICM has gone through a significant transformation over the past few years with Nick as CEO and Grant as President and I’m excited to be part of the next phase of growth.

I’ve been on the council around 3 years and look after the membership portfolio.

What part of the world do you come from? I was born in Newcastle, but my mother is from England and I was lucky enough to get a British Passport which allows me to travel through Europe and work without a visa.

What part of the world do you come from? I grew up in Perth WA. It was almost 20years ago that my company brought me to Sydney to Manage the Sydney office. Sydney is now my hometown.

What is your favourite movie quote? My favourite movie is Braveheart and I can quote many of the lines in that movie, however another favourite is the Shawshank Redemption and the quote I remember best is “Get busy living or get bust dying” which sums up my attitude to life.

What is your favourite movie quote? Audrey Hepburn in Breakfast at Tiffany’s – “No matter where you run, you just end up running into yourself.”

What sport/team do you barrack for? Being a Novocastrian, I have always been a tragic Newcastle Knights fan, from the time I attended their very first game with my grandfather in 1988, I always wanted to pull on the red and blue jersey which I eventually did when I signed a contract to play in their under 19’s Jersey Flegg team back in 1999. There are only two players who warrant a mention from that team, one because he went on to be a dual international playing for Australian in both league and union (Timana Tahu) and the other (Clint Newton) who went out with Jennifer Hawkins at the time and ended up dumping her to focus on football. Do not remind me that the Knights finished with the wooden spoon in 2015. What would you say has been your biggest success in your career? There have been some highlights in my relatively short career such as touring through Europe with the Wallabies in 2001 as their media liaison officer or helping to bring the Professional Darts Corporation to Australia. But I would have to say starting my 3rd company, self funding it and going into partnership with one of my best friends, Shane Ashton, would have to go down as my biggest success thus far.

Why did you get involved on Council? I really believe in the value that this organisation has within the credit profession. I’m also a strong believer in continual training and development of your own career as well as developing my team members. It just felt right to be a part of such an iconic organisation.

What sport/team do you barrack for? AFL – I’m a Carlton fan NRL – I’m a Broncos fan What would you say has been your biggest success in your career? Over the years I’ve been able to achieve many milestones. I really do like seeing my team members achieve success. For many years, I have had the opportunity to work with many talented people, I do get an enormous sense of pride, especially when I see someone I have worked with develop skills and confidence to move into a more senior role within the credit profession.

The Australian Institute of Credit Management welcomes our Partners for 2015. National Partners

Divisional Partners

Sue Day MICM CCE NSW Councillor, Membership Portfolio How did you get involved in the credit industry and in what capacity have you been a credit professional? After I completed my Business Administration Diploma I started work as a junior administration clerk (many moons ago). Starting at the bottom per se, I put what I learned into practice, from filing through to answering the phone and to taking orders. I really liked speaking to the customers and over time built up a great relationship with many of them so, as my role within the business grew, I would help my boss out and call my favourite customers for their account payments – this started my career in credit management. To this day, I still enjoy talking to and getting to know my customers. How long have you been involved with the AICM? I have been a member of the AICM for around ten years. 44

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

Professional Partner

Official Division Supporting Sponsors

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

Queensland AROUND THE STATES YCPA Event: Stacey Woodward, Melinda Grob, Jessica Beikoff and Roger Masamvu.

Brian Kay and Murray Murray Walter accepting the Marion Hintz Meritorious Service Award 2015 from Brian Kay.

President’s Report First of all I wish to thank Brian Kay for his encouragement, mentoring and enthusiasm as our immediate past president. Brian has made it all look “easy”, whilst being a shining example of what a fantastic organisation AICM is and will continue to be. As you will notice our team of Qld councillors has increased as members take up engagement and drive your organisation. AICM is “owned” by all of its members and will continue to be an organisation creating opportunities for all members to engage and participate in the future shape of their industry. We are making member engagement our state priority this year. Borrowing from the fantastic work done in NSW, portfolios will be actioned by not just one person. All members will be able to assist in a small way, or as much as they wish, by simply contacting the councillors and saying they would like to lend a hand. Some of the things members are already able to engage in, or by, include Facebook and LinkedIn (contact Stacey “FBF” Woodward from Hastings Deering), fantastic events such as the “Women In Credit (WINC) Function” (contact Julie McNamara at Patane Lawyers), and Members’ Services (contact Mel Grob at Ranstad). Other means of engagement will be announced with the next AICM Qld calendar. If members or their employers would like to help in any way, a list of councillors’ contacts and their portfolios will be circulated shortly. In July, Qld hosted the Dun & Bradstreet 2015 Qld AICM Young Credit Professional Dinner, with NCI’s Michael McDowell (and likely winner of the national YCP award) announced as our

YCPA Event: Gemma Poore, Jessica Beikoff, Murray Walter, Michael McDowell and Renee Dobson.

state’s winning candidate. Murray Walter (of Dun & Bradstreet) was also awarded our annual Marion Hintz Meritorious Services Award 2015 for his commitment and assistance over the years, not just in 2015. Thank you again, Murray. August saw a fantastic group turn up for our 2015 WinCollect Annual Qld AICM Golf Day at the Wynnum Golf Club which runs along Wynnum Road. The weather was a little dodgy and some wayward shots meant Wynnum Road drivers may have noticed unseasonal “hail” damage to their cars, however it was an excellent day. Thank you again to our continuing key sponsor, WinCollect, as well as our other event and state supporters, without whom such events would not be possible. We are all looking forward to an excellent conference in Sydney 2015, and to catching up with all our fellow members to share our experiences in the credit profession in this last year. – Peter Mills MICM, President October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

Queensland Roger Masamvu MICM – Qld Councillor, Vice President/ Treasurer Roger’s face would be a familiar one, as previous winner of the Qld YCP award back in 2013 Roger joined council and was recently appointed Vice President. He currently holds the role of Credit Manager for JBS Australia. In his spare time Roger enjoys spending time outdoors in the company of friends.

control and insolvency litigation. He is also an accomplished author and has had articles published in various journals and magazines. Greg is a Partner in Forbes Dowling Lawyers based in Brisbane. Forbes Dowling is a National Commercial Litigation and Debt Recovery law firm.

Introducing Qld’s 2015 YCPA winner

Julie McNamara FICM CCE – Qld Councillor, Events Julie has been looking after the 2015 events for Qld and if the YCP event this year was anything to go by, she’s doing a fantastic job. She has spent the past year at Patane Lawyers as the National Credit Consultant & Business Development Manager. Previous to that she had spent 7 years with Hyne Timber. Julie’s number one passion is her family. She loves challenging not only herself but her husband to keep fit and healthy.

Peter Mills, MICM, LLB – Qld Councillor, President, Partners Peter has been a member of AICM for over 10 years. He is also a member of the Qld Law Society’s Banking & Financial Services Committee and a Working Group Member of the United Kingdom’s Secured Transactions Law Reform Project. Peter is a Special Counsel with Thomson Geer Lawyers, and a recognised expert on the Personal Property Securities Act and its interaction with other laws. Peter lived and worked overseas as a lawyer, sailed competitively in PNG and was a trained firecrew in the QFS. He enjoys family trips (especially skiing, golf and NZ wine tours). In 2010 Peter received the AICM National award recognising him for “outstanding contribution to the development of the body of knowledge in relation to the Personal Property Securities law reform in the credit industry”. He was also recognised in 2013 with the inaugural AICM Qld Marion Hintz award.

Greg Young MICM CCE – Qld Director Greg holds a Bachelor of Arts Degree from the University of Queensland (1979), a Bachelor of Laws Degree from the Queensland Institute of Technology (now QUT) (1985) and was admitted as a solicitor of the Supreme Court of Queensland (1984) and the High Court of Australia (1986). He has been a Justice of the Peace since 1982. Greg is a past President of the Queensland Branch of the Australian Institute of Credit Management and currently the Queensland Branch Director to the National Board as well as a Past President of the Rotary Club of Wishart and the Australia-Africa Business Council. He has been a specialist in Commercial Litigation for in excess of 25 years and is an experienced speaker on topics including debt recovery, credit 46

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

Murray Walter (left) and Michael McDowell.

Michael McDowell Michael is currently a Sales Executive with NCI, not only taking out this year’s Qld YCP award, also excelling within NCI by taking out Sales Person of the Year in June. In his spare time Michael enjoys fishing, bike riding and is an avid sports fan, his team being the Sydney Swans in the AFL. A little known fact about Michael is that in 2007 he spent a summer in England playing cricket. We all wish Michael the best of luck at this year’s conference (not that he’ll need it!)

Queensland AROUND THE STATES

Qld YCP finalists Although not winning this year’s Qld YCP these ladies were fantastic competition, each handling themselves brilliantly throughout the judging process. We hope to see them in the years to come at AICM events and conference.

Renee Dobson

Jessica Beikoff

Gemma Poore Golf Day

2015 Qld Golf Day Report Wynnum Golf Course played host to this years Wincollect AICM Golf Day. The course and greens were in fantastic condition after being hosed off by the warm Queensland rain. The teams of 4 rolled out cart by cart for the shotgun start ambrose competition. The weather was a little hit and miss which only added to the tight finish that resulted in the difference between first and second place being 0.5 of a point. The first place getters were the Dun & Bradstreet team with a score of 52.375 (Murray Walter, Tim Lord, Micheal Blonk and Peter Waugh) followed very closely by the Forbes Dowling team (D Myrteza, P Manttan, M Elliot and S Dawson) with a score of 52.875. Third place went to the Veda team who had to import Charlie Tims from Victoria. Tim Lord and Carla Sierlis took out the longest drive and the following took out nearest to pins – Peter Manttan, Mark Browning and Micheal Blonk. Thanks go to Wincollect for their major sponsorship, to Greg Young in absentia and to our hole sponsors and other prize suppliers – D&B, Forbes Dowling, Veda, Randstad, Results Legal, Creditorwatch, Thomson Geer Lawyers and the AICM. A great day was had by all and thanks goes to the Wynnum Golf Course for their excellent hospitality and set up. See you all next year.

Golf Day

The Australian Institute of Credit Management welcomes our Partners for 2015. National Partners

Divisional Partners

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.

Golf Day

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

South Australia

Year of service pin recipients – Stephen Prescott, James Devonish, John Antoniadis, AJ Jaramillo, Nick Cooper and Rod Sims.

YCP Award – Michael Seychell State Manager Dun & Bradstreet with YCP SA Winner Tate O’Connor from NCML Limited.

President’s Report With EOFY well behind us we are getting closer to the ‘silly season’. SA councillors will now be focussing on their final networking event for the year. We are also going to rev up the calendar of events for 2016, so everyone stay tuned! Credit Focus events have continued to coast along with the latest presenters being James Neate and Alan Scott – both of which have many years’ experience and know how to grab their audience’s attention! We still have one of our very popular educational events to go which is the full day Credit Symposium. A modern and central venue is being considered with the date to be around mid to late November. This is a must for all credit professionals as it is guaranteed to have a high calibre of speakers and provides an ideal opportunity to compare notes with your peers. Our annual Award’s Dinner was a great night. The guest speaker, Mr David Griggs, gave all attendees a little something to take home and consider when looking at self-improvement particularly with regards to professionalism and poise. Michael Seychell, State Manager Dun & Bradstreet, was kept busy giving the audience a background on their involvement in the YCP awards and introducing the finalists. Josh Richards gave out the new member’s certificates and years of service pins. Michael then returned to announce our YCP winner for 2015, Tate O’Connor, from NCML. Tate gave a very encouraging and humble thank you speech showing his natural ability to think on his feet. All the best at National’s Tate. Since our AGM we are pleased to say we have a few new faces on council. We look forward to our continued brain storming and invigorating meetings. Council is always 48

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

YCP Finalists for SA with Michael Seychell, State Manager Dun & Bradstreet.

looking for new venues and a different format for our functions and any feedback is appreciated to move in a positive direction. Over the months ahead we will be looking at areas to increase the interaction with our Sponsors. We value their support and will be encouraging them to meet and work with us to ensure they receive the optimum exposure and benefits of being involved with the AICM. Bring on summer! Adelaide has had a bitterly cold and wet winter. Let’s make the most of the warm months ahead with some outdoor events. – Gail Crowder MICM, SA Division President

Credit Focus, 17 October 2015 Processes – Risk Analysing Customers Presenter Trevor Goodwin from NCI (National Credit Insurance Brokers Pty Ltd). Trevor covered in his presentation all the “needs to know” of Risk Analysing. I must say even though we were only small

South Australia AROUND THE STATES

Events Calendar

12 November

Credit Focus – PPSR and retention of title implications Speaker: TBA Subject: Protecting your security interest

Venue: Education Development Centre, Hindmarsh

4 December

Network evening and Christmas break up

Alan Scott of BRI Ferrier – Credit Focus presenter for September.

James Neate of Lynch Meyer – Credit Focus presenter for August.

Annual Awards Night

SA new members certificate presentation.

in numbers we certainly made up for it with involvement and questions throughout the presentation. Topics discussed were Risk Assessment, Warning Signs, Identifying, Monitoring and Communicating just to name a few but there were many more areas that we touched on throughout the morning session. Trevor reminded us all of the 5 “C’s” of Credit. Character, Capacity, Capital, Collateral and Conditions. This should be a strong base to start when opening a trade account or analysing your customers. Who are you dealing with? There were some great questions and experiences discussed and everyone seemed to go away with lots of “food for thought”. Trevor presented this topic very well and was easily understood by all in attendance. I emailed the presentation notes and received positive feedback on how well this Credit Focus session was received. – Anne Wilkins FICM CCE, Credit Focus Portfolio

Our Annual Awards dinner for the Young Credit Professional of the year, sponsored by Dun & Bradstreet, was held on Wednesday 20th August at The Highway. We had 80 people attend the event showing their enthusiasm for networking and socialising amongst their peers. It turned out to be a most enjoyable evening, The Highway was a lovely venue, perfect size for our numbers, and had excellent service and quality meals. The guest speaker for the evening was Mr David Griggs, who is a professional development speaker. David gave a brief presentation focussing on some tips on “How to best present ourselves at public speaking engagements”. Kevin Hollister, from Kemps Credit Solutions, provided the introduction and vote of thanks. State Manager D&B, Michael Seychell, introduced the finalists for the YCP State Award; Emma- Jade Eaton from National Credit Management, Glen Wingate from National Credit Management, Irene Baird from Bendigo and Adelaide Bank, Jade Clayton-Cuch from Mercantile CPA, Shivaan Christensen from National Credit Management, Tate O’Connor from National Credit Management, Yulia Petrenko from Worrells Solvency & Forensic Accountants and Wayne Howard from National Credit Management. Later in the evening Michael announced Tate O’Connor as the winner of the SA YCP Award for 2015. Good luck in the nationals Tate! During the evening, Josh Richards the SA Division’s membership chair, presented AICM Membership certificates October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

South Australia

SA Credit Focus: Lyn McKell (left) with Merna Spain.

SA Credit Focus.

SA Quiz: Lynch meyer table.

SA Quiz: Throw money at the bottle – Rebecca and Daniela.

Throw money at the bottle winner Sean with Sarah, Gail and Claire.

SA Quiz: Quiz Night winning table – Hunt & Hunt.

to a range of new members. Josh also announced the “Years of Service Memberships” and presented pins to each, ranging from 5 to 30 years. To conclude this enjoyable evening State President, Gail Crowder, thanked everyone for attending and D&B for their ongoing sponsorship of the YCP Award. We look forward to seeing everyone next year!

The Australian Institute of Credit Management welcomes our Partners for 2015. National Partners

Divisional Partners

Quiz Night The SA Division’s Quiz night was held on Friday 26 June at the Unley Community Hall. It was a fun and entertaining night and the hall was the perfect size for our group of 60 people. The quizmaster for the evening was the experienced Chris Rebbeck who entertained attendees with an array of interesting questions. Games held on the evening included “Heads and Tails” and “Throw the Money” at a bottle of Chivas Regal. After a keenly fought contest Hunt & Hunt Lawyers came out winners on the evening for the second year in a row. Congratulations to the winning team! Through the kind generosity of sponsors we were able to raffle a number of great prizes on the night. An auction of an R&M Williams voucher was also conducted on the night, with the winning bid by Neil Ricketts. We thank the following sponsors for their donations: R&M Williams Bickfords Australia/Vok Beverages Veda Advantage Worrells Solvency and Forensic Accountants Banner 10 National Credit Insurance (Brokers) Samuel Smith & Son Pernod Ricard Winermakers Hills Industries Coopers Brewery Toro Australia Hunt & Hun Lawyers Kemps Credit Solutions Lynch Meyer Lawyers Festival City Wines & Spirits – Trevor Goodwin FICM CCE, Functions

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

Victoria/Tasmania

July Network Event – Active participation on the part of members and Guests at the July Network Event.

AROUND THE STATES

July Network Event – Rebecca Fahey (Smith Leonard Fahey Lawyers) presents on Litigation.

August Network Breakfast – Jason McCutcheon presents on Being a Good Leader.

August Network Breakfast – Members and Guests focussed on the Presenation.

far. I would like to congratulate Patrick Barry from Good Year & Dunlop Tyres as this year’s Vic/Tas YCPA winner. Patrick will be representing Vic/Tas at the National Young Credit Professional Awards in Sydney at the National Credit Conference. Also congratulations to Kimberly Milton from Thorn Group NCML for winning the Tony Mamone Award. I extend a warm invitation to all our members to participate where possible in upcoming events or seminars. If there is a topic or seminar you would like included in next year’s Vic/Tas calendar of events please get in contact with us via our email address vic@aicm.com.au. Look forward in seeing you at our next event. July Network Event – Members and Guests keenly focussed on the presentation.

– Lou Caldararo FICM CCE

June Network Event: To litigate or not to litigate? That is the Question!

President’s Report I would like to welcome on board Neil Smith to the council. Neil will be looking after the Pinnacle Awards. Stay tuned more on this in the very near future. I would also like to thank all the other councillors who choose to re nominate and remain on the Vic/Tas Council I thank you for your ongoing support. The Vic/Tas council is committed to bringing our members a diverse range of events from the credit network forums through to social events such as the always popular Golf Day and Trivia Nights. We have had another fantastic participation in the Vic/Tas Young Credit professional Awards with more than 22 enquiries and 14 applications submitted. All entrants set a very high standard with their application and right through the whole interview process. I would personally like to thank each and every applicant for their time and effort getting this

Rebecca Fahey of Smith Leonard Fahey Lawyers delivered an excellent presentation on making that all important decision as to whether to litigate or not. Rebecca has over 15 years’ experience in the industry and covered the importance and relevance of litigation and tips or tactics that can be used in order to bring a speedy resolution with a favourable outcome. She also covered some very important steps that can be taken prior to proceedings to minimise your risk and help protect your business from future episodes of litigation. The event was well attended with approximately twenty in attendance and the feedback from members and guests was that it was an informative and enjoyable presentation. Many thanks to Rebecca for donating her time and expertise. – Donna Smith MICM October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

Victoria/Tasmania

YCPA – President Lou Caldararo with Keynote Speaker Narelle Fraser.

YCPA – VIC/TAS Divison YCP Award Winner Partick Barry (GoodYear & Dunlop Tyres) and Runner Up Kimberley Milton (Thorn Group NCML).

August Networking Breakfast – What Makes a Good Leader? A quality group of members and guests attended our August Network Night, where Jason McCutcheon from Biscom Training, recipient of the Swinburne University of Technology Industry Engagement Award in 2010 and runner up for Teacher of the Year at Box Hill TAFE in 2010 and 2012, delivered an excellent presentation on “Being a Good Leader within the Credit Industry”. A quality group of members and guests showed great interest as Jason discussed how managing people well can be the difference between a successful or unsuccessful business. It was a great presentation for aspiring leaders as not everyone can lead people well. Fundamentally being is a great leader is about being able to engage your team and inspire their respect. Not only are these great skills to have as a leader but great skills to have as a collector. Any education that you can gain in this area will be invaluable for your future no matter what industry. Watch out for upcoming educational events. – Donna Smith MICM

YCP Awards Dinner We seem to outdo ourselves year after year. Another group of quality entrants in this years’ Young Credit Professional (YCP) of the Year Awards. There were 14 applicants who stepped up and entered in the prestigious YCP Awards for 2015. The entrants were Laura Sheehan (Ansvar Insurance), Daphne Zevgaras (Reece), Joshua Rutland (Bendigo & Adelaide Bank), Stacey Feaver (Austral Mercantile), Megan Kernick (Reece), Kimberley Milton (Thorn Group NCML) who took out second place (the Tony Mammone Award for runner up) and Patrick 52

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

YPCA – Robyn Erskine (Brooke Bird) Members and Guests.

Barry (GoodYear & Dunlop Tyres) who is Vic/Tas Division winner for 2015! Congratulations to Patrick and Kimberley and to all the participants for getting involved and taking part. Being part of the YCP Awards is an excellent way to strengthen your relationship with your employers, gain valuable self-esteem, confidence and recognition in your workplace, and become more involved in the AICM, where you can network and meet other likeminded credit professionals. Patrick will represent Vic/Tas Division in this year’s National YCP Award Finals to be held at the National Conference in Sydney this year. Again our congratulations and thanks go out to all the participants for making the commitment to themselves, their employers and the AICM in participating this year and a big thank you to the panel of judges, without their valuable input we would not be able to hold this event. A very charismatic Narelle Fraser was our Keynote Speaker this year. Narelle was a member of Victoria Police for 27 years, the last 15 as a Detective specialising in sex offence and child abuse investigations. She worked in areas such as the Rape & Sexual Crimes Squads, Missing Persons Unit & Homicide Squad. Narelle transferred to the country in 2005 where her Detective training skillset was dramatically tested. Investigating sex offences & child abuse she expected, but dealing with cranky livestock & native ‘wild’ animals was a whole new world to a female cop with a secret fear of animals. Life as a ‘country cop’ tested every level of Narelle’s experience & expertise! Narelle recanted stories from her time as a police officer; some funny, some sad and some shocking as promised. One of the main challenges facing our Police men and women is stress

Victoria/Tasmania

YCPA – Members and Guests from Bendigo Bank.

We would also like to thank the members on the committee who organised the event and the Intercontinental Hotel for their wonderful hospitality. For any young person in credit please know that participating in the YCP Awards is not only a great way to actively involve yourself in your career development, but by participating in the program you can also highlight your attributes to your employers, peers and seniors in the industry and contribute to showcasing your employer to the industry. For further enquiries regarding entry to the 2016 YCP Awards please contact YCPA committee chair Louie Tzakopoulos: Louie.Tzakopoulos@wurth.com.au – Donna Smith MICM YCPA – President Lou Caldararo, Darin Milner (Dun & Bradstreet) and Louie Tzakopoulos (Wurth Aust) with the VIC/TAS Division YCPA Entrants.

management, and Narelle certainly conveyed that message in her presentation. It is not often we take stock of what our Police members endure as part of their day-to-day roles. Special thanks go to our National Sponsor Dun & Bradstreet for their continued support of the AICM and for again sponsoring this annual event. A huge thank you goes to Louis Tzakopoulos and the YCP sub-committee for their tireless work in receiving applications, interviewing candidates and getting the word out there to young people in credit. You are the future of credit so get involved!

Events Calendar

Inspirational quote of the Vic/Tas Division “Keep on learning, because knowledge is something that no one can take away from you.” – Jessie J.

The Australian Institute of Credit Management welcomes our Partners for 2015. National Partners

Divisional Partners

20th November

Women in Credit Business Luncheon

Save the Date!! More details coming soon. Your chance to hear fabulous female speakers and network with women in the credit industry. 4th December

VIC/TAS Division Christmas Party Cocktail party at Krimpers

Caption 20 Guildford Ln, Melbourne VIC 3000

Professional Partners

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

YPCA – Laura Sheehan (Ansvar Insurance) and guests.

AROUND THE STATES

Western Australia/Northern Territory

Guests at the Gala Dinner.

President’s Report The AGM is always a time to reflect on the year’s achievements, successes and failures. Without all three we would not have a complete picture. The WA Council has a great mixture of youth and experience. This year has shown that such a team can do just about anything. Quality has been our drive in 2015. The Breakfast Club Series has delivered information on Bankruptcy Fundamentals, Mining and Mining Services as well as a PPSR Workshop. We have been able to cover relevant and important topics to the WA Members. We look forward to continue this next year. Still to come is the Ladies High Tea and Christmas on the Bay. In July our members gathered for the YCP Awards Gala Dinner. We had many great candidates but as they say, there can only be one winner. David Brennan is a worthy winner and when you meet him you will see why. He is very much a gentleman and a scholar, with a broad cross section of experience in credit and in life. We are very proud to have him represent Western Australia at the National Conference in October. My initial reason for joining Council was to extend myself, both as an individual and as a credit professional. Initially involved with functions, I booked, planned and hosted my first event within 8 weeks of arriving on Council. Developing the functions portfolio seemed to fit with me but stepping into the President’s role would take some real chutzpah, willingness to learn and lots of growth. I understand each day in the chair will provide a new challenge. Nothing ventured, nothing gained. I am looking forward to building on what we have and bringing a fresh approach on how we do things. I encourage all members to contact me direct with any questions or suggestions. – Lisa Marr MICM

WA Council Steve Mitchinson LICM – WA National Director Steve joined the AICM back in 1978 and has spent many years both in WA council and national Board, serving as National President between 1994 and 1997. After many years in a variety of credit and customer management roles, Steve started his own business improvement consultancy in 2007 54

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

Speaker Mark Englebert.

WA YCP finalsists.

and has a number of Australia’s most recognised brands as clients. Steve is a devoted Fremantle Dockers supporter and spends his time away from work paddling surf skis and is an active supporter and fundraiser for the Cure Brain Cancer Foundation.

Byron Savage MICM – WA Councillor and Treasurer Byron has a long career as an accountant, primarily in insolvency practice (gaining registration as a Liquidator), in Australia and extended periods in the UK. He later refocussed his energies to become a credit manager for some large ASX entities. A more recent change has Byron now direct the Finance activities in the Shared Service office for the WA Department of Health to include its billing and credit control. Being on the Council for 6 years he is enjoying the roll of looking after the dollars for the Institute’s long-term financial security. When not taking in the armchair sport of AFL spectating, he escapes the family and responsibilities for mountain biking… as he attempts to regain his youth.

Western Australia/NT AROUND THE STATES

Guests at the Gala Dinner.

Speaker Ian Francis.

Guests at the Gala Dinner.

Lisa Marr WA President.

Tamera Russell MICM – WA Councillor Tamera has a credit career spanning 10 years and she has worked in a variety of industries including Automotive Part Supply, Freight, Labour Hire, Scaffolding and Industrial Services, Telematics, Machinery and now Retail. As a member of WA Council her goal is to increase the interest of the younger credit professionals with the AICM, firstly with event attendance and secondly with membership. Outside of work Tamera was a successful Roller Figure Skater competing for Australia. Now she spends some of her free time coaching up and coming skaters at her local roller rink. The rest of her free time is taken up with watching movies/TV shows, travelling and keeping active.

David Brennan – 2015 WA YCP David joined the credit industry in 2012 with a goal to change the way that credit was assessed and issued through the use of technology, loan assessment algorithms and machine learning. Starting from a totally blank piece of paper he created a consumer lending assessment

process and business which has since meaningfully changed the efficiency of the industry. Subsequently David and his team have partnered with some of the UK and Silicon Valley’s best investors, technology suppliers and companies to bring Kikka Capital to the Australian market, an SME lending platform offering business owners lines of credit up to 100k and assessed online in 7 minutes. When not working David is an avid fitness enthusiast, enjoys traveling, watching movies or anything competitive and generally enjoys learning about how technology can disrupt traditional industries. It is through this love of technology and its implementation to the credit market that David hopes to bring younger, more technology focused views to the AICM.

Warren Myers MICM – WA Councillor Warren is a Recruitment and Credit Services Consultant specialising in credit recruitment and assisting companies with credit services to manage the debtor’s ledger. His Credit experience includes corporate debt recovery to credit recruitment and credit services assisting companies to improve and maintain cash flow. His passion is helping people achieve their goals, ocean surfing and swimming. October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

Western Australia/Northern Territory

Great guests, great food – at the Gala Dinner.

Steve Mitchinson and Kevin Allen.

YCP Gala Dinner Lights! Camera! Action! This year the WA Division sought to step away from tradition with the Dun & Bradstreet Sponsored YCP Award night. The event was moved from city central to the Perth riverside. The PCEC was the venue for this years YCP presentation. The blue and silver colors of the AICM decked the tables and brought to life the chatter at each table. The new Sponsor banners highlighted the continued support we have in WA and across Australia for the work we do. The candidates covered a cross section of credit areas here in WA to include state utilities and new technology for credit management. We are continually encouraged by the calibre of credit professional that nominates for this prestigious award. The future looks bright here in WA and I’m sure there is more talent to come. We look forward to unearthing these individuals as the year progresses. If you have a team member that works hard and understands their role in credit, then we would love to hear from you. – Lisa Mar MICM

The WA Breakfast Club has slowly grown in stature for 2015. Each presentation has been well subscribed and the topic well researched. Mark Englebert’s presentation on Mining and Mining Services on the 12th August 2015 was no different. With the Mining Industry going through many changes we, as credit professionals, need to keep up with trends and look further into clients habits than we normally would. If you require a copy of the presentation notes please let me know. – Lisa Mar MICM

September 2015 Will be a quieter month for us here is the West. However, we will be getting a little louder toward the end of September with the Social Soiree – High Tea.

The Australian Institute of Credit Management welcomes our Partners for 2015. National Partners

August 2015 We were very privileged to have our National President visit during August. Nick Pilavidis hosted a small “Round Table” in Subiaco and attended the Breakfast Club Series. It was great to meet Nick and especially nice to have him here for my first event as President.

Events Calendar

Divisional Partners

20 November

AICM Breakfast Club, Time: 7.15 am Venue: Matilda Bay Nedlands

10 December

XMAS on the Bay

Venue: South of Perth Yacht Club, Freshwater Bay

CREDIT MANAGEMENT IN AUSTRALIA • October 2015

New Members The Institute welcomes the following credit professionals who were recently admitted to membership in July and August 2015.

Queensland Amber Anderson-Goodwin Ben Blake Charmayne Cullum Deborah Douglass Megan Dunbar Nicholas Feyer Angela Flanagan Kirsty Gray Jessica Harris Ross Leggett Loan Nguyen Shaun Rose Sharlene Roycroft Maria Teodosio Maria Tisdell Elizabeth Tofa Kerryann Turner Jenny Ung Nathan Wilkinson Roman Wyrich

Hanson Construction Materials Pty Ltd Transpacific Industries Pty Ltd …… Rocla Pipeline Products Dun & Bradstreet Australia Pty Ltd Seaway Agencies Coventry Group Ltd Stoddart Group Signet Pty Ltd Ruralco Holdings Limited Stoddart Group Pty Ltd Rose Litigation Lawyers Signet Pty Ltd Stoddart Group ……. Hanson Construction Materials Pty Ltd Aurecon Australasia Pty Ltd Rodgers Reidy Chartered Accountants National Collection Services Coventry Group Ltd

New South Wales Farhad Aram Robin Carter Geraldine Catig Anne Fahey Claudia Harley Eva He Natalie Joseph Caroline Karaki David Moss Cheryl-Anne Murray Yessyria Panggabean Michael Quinn Morris Sclippa Leigh Shipton Arthur Siannos Rinu Thomas

Ruralco Holdings Limited Byron Thomas Recruitment Ruralco Holdings Limited Skilled Group Limited Rocla Quarry Products BOC Ltd MSA (Aust) Pty Ltd Shield Mercantile Pty Ltd Vodafone Hutchison Australia Rocla Pty Ltd Employsure Pty Ltd Australian Receivables Limited Ruralco Holdings Limited SR Law Aurecon Australasia Pty Ltd Ruralco Holdings Limited

Corporate Member Right2Drive Pty Ltd

Victoria/Tasmania Lynda Allen Ersilia Barbone Nancy Costa Loren Crawford Brett Cresswell Debra Enright Meghan Gruber Clayton Gunderson Annette Hand

Lander & Rogers Lawyers White Cleland Lawyers National Credit Management Limited Seek Ltd Skilled Group Ltd GWA Group Limited Adidas Australia Pty Ltd Rodwells & Co Aurecon Australasia Pty Ltd

Teresa Harut Malcolm Howell Jennifer Iese Brian Maher Malani Mason Adrienne Mills Kimberley Milton Anjali Munjal Kerry Nicholl Tony Pilimon Anthony Pilimon Jaydene Pirake Kelly Poulton Priya Ramani Sohail Raza Anthony Rivas Karen Russell Michelle Saavedra Zdenka Sare Eunice Sissing Elizabeth Stonehouse Kalpana Teckchandani Glenn Thomas Tania Walsh Kristin Witt

Seek Ltd Jirsch Sutherland Seek Ltd Adidas Australia Pty Ltd Reece Pty Ltd Warrnambool Cheese & Butter Factory National Credit Management Limited Australia Post Thomas Warburton Pty Ltd Aurecon Australasia Pty Ltd Aurecon Australasia Pty Ltd Seek Ltd Adidas Australia Pty Ltd Australia Post Aurecon Australasia Pty Ltd Australian Receivables Limited Total Eden Pty Ltd Goodyear & Dunlop Tyres (Aust) P/L Peerless Holdings Pty Ltd National Credit Management Limited GWA Group Limited Thomas Warburton Pty Ltd Australia Post Seek Ltd Decision Intellect Pty Ltd

South Australia Michael Bayly Dominic Cantone Emma Clapp James Cooper Neil Fennell Jaden Harrip Zaena John Antonios Kovios Rocco Lionello Scott McGrice Matthew Paulsen Yulia Petrenko Leigh Prior George Vahaviolos Monika Vucenovic Montgomery Wolf Rebecca Young

National Credit Management Limited Worrells Solvency & Forensic Accountants National Credit Insurance (Brokers) Pty Ltd Worrells Solvency & Forensic Accountants Worrells Solvency & Forensic Accountants Worrells Solvency & Forensic Accountants CCC Financial Solutions Group National Credit Management Limited CCC Financial Solutions Group Worrells Solvency & Forensic Accountants Worrells Solvency & Forensic Accountants Worrells Solvency & Forensic Accountants Pitcher Partners CCC Financial Solutions Group Kemps Credit Solutions Worrells Solvency & Forensic Accountants Worrells Solvency & Forensic Accountants

Western Austalia Scott Chaproniere Daniel Czaplinski Colette Davies Johlee Fernandez Rosanna Maugeri Benjamin McCallum Kate McDonald Michel Tholasse

Aurecon Australasia Pty Ltd National Credit Insurance (Brokers) P/L Rocla Pipeline Products National Credit Insurance (Brokers) P/L ……… iiNet Ltd Sealanes (1985) Pty Ltd Global Construction Services Ltd

October 2015 • CREDIT MANAGEMENT IN AUSTRALIA

AROUND THE STATES

NEW MEMBERS

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