Upload
nick-pilavidis
View
227
Download
13
Embed Size (px)
DESCRIPTION
Wishing Members a happy and safe holiday period. This issue features articles to engeage and motivate, timely industry updates including upcoming changes to contracting with small business.
Citation preview
The Publication for Credit and Financial Professionals I N A U S T R A L I A
FIND OUT THE LATEST ON:
HumanResourcesCreditManagementLegalandPPSTrainingnews
Season’sGreetings
Volume 23, No 2 December 2015
CREDIT MANAGEMENT IN AUSTRALIA • December 2015
NSW Division: Golf Day.
Qld Division: WINC Panel – Gemma Twemlow, Julie George, John McNamara and Sonia McDonald.
SA Division: Neil Fennell – Credit Management Fundamentals.
35
40
44
Vic/Tas Division: Trivia Night winners – Team Transurban.
WA/NT Division: High Tea.
47
51EDITORIAL CONTRIBUTIONS SHOULD BE SENT TO:The Editor, Level 3, Suite 303, 1-9 Chandos Street, St Leonards NSW 2065 or email: [email protected]
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
CHIEF EXECUTIVE OFFICER
N. Pilavidis MICM CCE
Level 3, Suite 303, 1-9 Chandos Street, St Leonards NSW 2065
PO Box 64, St Leonards NSW 1590
Tel: 1300 560 996, Fax: (02) 9906 5686
Email: [email protected]
EDITOR/PUBLISHER
Nick Pilavidis | Email: [email protected]
CONTRIBUTING EDITORS
Colin Magee NSW
Stacey Woodward Qld
Gail Crowder SA
Warren Meyers WA
Donna Smith Vic/Tas
ADVERTISING MANAGER
John Field FICM, CCE, ACPM, Ph: 1300 560 996
Mob: 0412 732 831, Email: [email protected]
EDITING & PRODUCTION
Anthea Vandertouw | Ferncliff Productions
Tel: 0408 290 440 | Email: [email protected]
THE EDITOR reserves the right to alter or omit any article or advertisement submitted and requires idemnity from the advertisers and contributors against damages or liabilities that may arise from material published. CREDIT MANAGEMENT IN AUSTRALIA is published by the Australian Institute of Credit Management, Level 3, Suite 303, 1-9 Chandos Street, St Leonards NSW 2065. The views expressed in CREDIT MANAGEMENT IN AUSTRALIA are not necessarily those of Australian Institute of Credit Management, which does not expect or invite any person to act or rely on any statement, opinion or advice contained herein (whether in the form of an advertisement or editorial) and neither the Institute or any of its employees, agents or contributors shall be liable for any opinion contained herein. © The Australian Institute of Credit Management, 2015.
JOIN US ON LINKEDIN
Click Here
Message From the President 2
Portfolio Update 6By James Neate MICM
Human ResourcesEngaging process focused staff 8By Paul Burgess MICM
Keeping it in the family 10
How do I know my worth 12By Jan Reeves MICM
Credit ManagementQuarterly Business Credit Demand Index 14By Paul McFadden
7 quick wins you get from phoning instead 16of (e)-mailing your customersBy Aroud Visser
Staff engagement – its not as scary as it sounds 18By Stacey Feaver MICM
LegalImpact of DOCAs 20By Joseph Scarcella MICM
Unfair contract terms 22By David Francis LICM
Foradvertisingopportunitiesin CreditManagementInAustralia
Contact:JOHNFIELDFICM, CCE, ACPM
Ph: (02) 9906 4563 | Mob: 0412 732 831 | E: [email protected]
Volume 23, Number 2 – December 2015
Frank Gambera
25Joseph Scarcella David Francis
20 22
PPSCase Note: Central Cleaning Supplies 25(Aust) Pty Ltd -v- Elkerton [2015] VSCA 92By Frank Gambera MICM
Lower PPSR costs for equipment 26hire businessesBy Moses Samaha MICM
AFSA launches new PPSR guide 27
The money or the box 28By Oliver Shtein
Annual Conference Photos 30
AICM Training News 32
Can we help? 34Trade references
Around the StatesNew South Wales 35Queensland 40South Australia 44Victoria/Tasmania 47Western Australia/Northern Territory 51New Members 53
Paul McFadden
14Oliver ShteinJan Reeves
2812
aic
mFrom the President
4 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
This month we are back to our regular
soft copy magazine following the annual
hard copy version we issue each year in
conjunction with the national conference.
Many members and colleagues attended the national
conference, in fact it was a record number who attended
at some stage over the three days and this record
extended to the conference golf day and the President’s
dinner. If you didn’t make it then make sure you get along
to next year’s event on the Gold Coast where we will take
the learnings from the Sydney conference and feedback
from delegates and members to provide you with the best
information, education and networking experience that
can be packed into 3 days.
z Plan now to get yourself there
z Include it in your annual budgets when next you
complete them
z Incorporate it as reward and recognition for achieving
your KPI’s or targets
z Add it to your training and development programme
z Use it as motivation and reward for your staff ie offer
to send them along, too, when they hit their targets.
The cost of the conference is far less than what good
organisations spend on the development of their
employees.
Thanks to Veda for again standing with us and being
our conference premium sponsor and supporting the
Credit Team of the Year Award which was won by Caltex.
Congratulations to Caltex who are a fantastic team
who have overcome a number of hurdles and produced
outstanding results in 2015.
Thanks to Austral Mercantile who were the conference
supporting sponsor. Their back up and assistance was very
much appreciated.
The biggest roll out at the conference was the
President’s dinner which was sponsored by Dun &
Bradstreet and at which we had the very great pleasure
to see Tate O’Connor from South Australia win the National
Young Credit professional of the Year Award in what was
once again a very strong field. An awesome acceptance
speech and an exceptional young credit professional.
Onya Tate.
Our CCE lunch was the largest ever with the greatest
number of awards presented including the Dux of the
Year which is sponsored by NCI and was awarded to
Alison Beythien, Holcim’s National Credit Manager. Well
done Alison.
The Christmas period is a time for reflection and as
we look back we are proud of 2015 especially
z The significant increases in student numbers
undertaking Certificate IV and Diploma courses – both
online and face to face. Inhouse training was conducted
at major banks and finance companies, utilities and
trade credit operations as far afield as Manilla.
z A record member participation at events across the
country such as full houses at Women in Credit or
WinC luncheons in Sydney and large numbers in
Melbourne and Brisbane, Insolvency Symposiums,
Network meetings, trivia nights and golf days in
Melbourne and Sydney
z The sell out of the Pinnacle Awards in NSW and,
following the growing success in New South Wales
in recent years, their expansion into Victoria in
December this year.
z The licencing agreement we entered into with
the UK Credit Institute, the Chartered Institute of
Credit Management. This will see us deliver quality
accreditation for Australian Credit Operations and raise
the bar here in Australia. Two companies are already
enrolled in the programme as we establish the AICMQ
accreditation.
z There were solid increases in nominees for the Credit
Team of the Year and YCP Awards and the calibre was
very high – again congratulations to Caltex and Tate
O’Connor.
z We introduced our online magazine and supplemented
Grant Morris CCE
Australian President
From the Presidentaic
m
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 5
this with the new monthly newsletter – making us
all better and more regularly informed.
z We helped the industry overcome the obstacle of
EDR’s and the Privacy Reforms requiring membership
of an external dispute resolution scheme.
z We hit our optimistic, but very necessary profit target
and have gone some way to restoring our financial
health following past storms. This puts us half way to
the target suggested by our auditor.
z There was a 20% increase in the number of CCE’s –
our highest professional recognition, and the biggest
growth in many years.
z We held our inaugural webinar, with many to regularly
follow.
While it was pleasing to see companies entering
External Administration of all forms drop to 12,726
in 2014/2015 (a fall of 9% and the lowest level since
2007/2008) it is interesting to note that the Q1 result
this financial year reveals 4,118 companies entered
administration. This is up 14% on Q1 in FY15 and represents
the 2nd quarter in a row where external administrations
have grown by 14% to the previous period. Not a good sign
at all and an indication of some tough times ahead.
On the personal insolvency front it is pleasing to
see the number of Personal Insolvencies were virtually
static in the September quarter when compared to
the September quarter last year (4,386 and 4,390
respectively) although it is an increase of more than
4% on the June quarter (4,215). It probably comes as no
surprise that the biggest increases were in the mining
states of WA and Qld with year on year first quarter
increases of 7.7% and 6.6% respectively. The next highest
increase was Victoria at 1.0%.
The message here is monitor these trends, take action
in managing your book, make your management aware of
the difficulties out there where they exist in your area of
trade and show your worth and professionalism to your
business by becoming a CCE.
Grant’s Soapbox
We continue to receive strong support of our proposed
lobbying of the Attorney-General and ARITA for
changes to legislation and practices in
z The period in which preference claims can be
made ie the 3 year “statute of limitations” on
making preference claims is too long and should
be shortened to a year or less.
z The recovery of preferential payments and those
Liquidator recovered funds not being paid in
dividends to unsecured creditors or any class of
creditor for that matter.
z Unsecured creditors who are genuinely at arm’s
length being subject to preference claims.
z Spurious and inflated preference claims from
Liquidators ie claiming $700K and settling for $10K.
z Fees charged by Administrators, Liquidators
and Receivers & Managers ie specifically annual
increases of 5 – 10% and more.
This action is now being taken up by James Neate
and the Legal Affairs portfolio with lobbying of the
Attorney-General to be our first action.
With the Federal Government announcing reforms
to the insolvency regime as part of the Innovation
Statement made on 7/12/15 (click here), the time is
right for us to unite and drive for practical reform to
address these issues.
We can never have enough support and it is not
too late to register your support by sending Nick
(our CEO) or I an email simply saying you support
positive changes in these areas. It doesn’t need to be
wordy. We are happy with a simple “good onya”. The
emails/links are [email protected] and
I hope we see you at an AICM event soon as you
support the Institute which supports you.
– Grant Morris [email protected]: 0407 405 198
aicm Portfolio Update
6 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
Legal Affairs PortfolioPreviously known as the Law &
Regulation Portfolio the Legal Affairs
Portfolio has been relaunched.
All Australian businesses, and
therefore all credit departments and
allied service providers, operate within
a highly regulated and complicated
commercial legal environment.
Professional credit controllers must
have current knowledge of a range
of legal matters in order to carry out
their duties. Given the complexities
of modern, professional, credit
management practice, it is appropriate
that the AICM continues its leading role
as a training and education specialist in
the niche credit industry.
The AICM also seeks to exert
greater influence as the voice of the
credit industry in terms of input into
legislative and regulatory change.
The focus of the National Legal
Affairs Portfolio is twofold:
1. To liaise with division Legal Affairs
Portfolio chairs to identify and
coordinate appropriate legal
education across a broad range of
topics and including:
z Australian Competition Consumer
Law, Australian Privacy Laws,
Workplace Occupational Health
and Safety Law, Personal Property
Securities Act, Corporations Act
and Bankruptcy Act in respect of
insolvency;
z ASIC debt collection protocols;
z Federal and State based legislation
and Court Rules.
2. To amplify the voice of the AICM
in driving legislative change and
reform which reflects members’
concerns. To do this, an informal
“AICM Legal Affairs Advisory
Panel” has been developed
drawing upon the skills of a broad
range of members and non-
members, credit managers and
legal advisers, each with their own
particular interests, networks and
specialties.
As National Director for South
Australia and Director of the Legal
Affairs Portfolio, James Neate,
Partner of Lynch Meyer Lawyers, is
always keen to hear from members
with any specific legal or legislative
issues of concern. Feedback from
members is vital in shaping the
education programme in an ever
more complex legal environment.
Contributions by members enable
policy formulation so the AICM
can continue to make relevant and
forceful submissions for legislative
change. The most recent examples of
these have been formal submissions
to the Commonwealth Attorney-
General’s Department as part of
the review of the Privacy Act and
Personal Property Securities Register
Act review.
James welcomes any direct
contact concerning the Legal
Affairs Portfolio and can be
reached on 08 8223 7600 or at
Legal AffairsAs part of an occasional series, we profile each National Portfolio to better inform members of the role of the National Board, its policy objectives and the work undertaken for members’ benefit.
Professional credit controllers must have current knowledge of a range of legal matters in order to carry out their duties.James Neate MICM
Human Resources
8 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
I was asked not so long ago how I go
about engaging collections staff who
spend their day making or receiving
phone calls. Their main task, and
in some cases their only task, is to
collect the debt that is the focus of
the call. The question was asked from
the perspective of keeping these
calls both professional and customer
focused.
In reality, making call after call
does lead to a very short term view
of the world. The next customer on
the list owes $100. The job at hand
is to collect that $100 in the shortest
time possible, within the confines
of legislative and ethical guidelines
and rules, and in alignment with the
culture of the company. This is by no
means an easy task, and is further
complicated by the addition of the
person making the call, their feelings,
beliefs and persuasions. Have they
just had a relationship break up?
Have they run over the cat on the
way to work?
As a leader, it is important to
have a clear vision: a picture that the
whole team can pick up and work
towards. It is the translation of this
vision to each role, each daily task,
that is the difference between the
success or failure of the vision.
When giving my answer I thought
hard about how I translate my vision
to the team and how well they
understand how they impact on the
success of that vision.
My vision is to make credit a
competitive advantage for the
company. It is easy to translate this to
a role where retention of customers
through problem solving their
issues feeds back into a competitive
advantage. This is what I would
consider a direct influence on the
pursuit.
However there are also indirect
influences on the pursuit. As an
example, the team member who’s
responsibility it is to pick up the
phone and make the collection calls.
It is true that a leader’s mind is in
the future and a manager’s mind is
in the present. In the modern world
people need less managing and more
leading. To bring the collections role
into the vision I first get the focus
off the immediate call and onto the
big picture. The call is not about
collecting $100 today, but setting
the customer up for good payment
behaviour for the next six to twelve
months. Yes, it is important to still
work to getting the $100 in, but it is
more important to work towards on
time payments over the next twelve
months.
Every collections call becomes
a potential relationship building
experience which keeps the mind
focused on the future. The next call
becomes easier, less stressful. The
one call everyone gets a day that
really gets under your skin becomes
more than manageable; it becomes
a challenge to work a potential
protagonistic situation into an
opportunity to win over a faithful and
passionate customer, to create a loyal
customer.
A success in this type of call
becomes a direct influence on
the pursuit towards competitive
advantage of the credit function. It
gives the team member a sense of
Engaging process focused staffBy Paul Burgess MICM*
Paul Burgess MICM
Human Resources
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 9
value in the team and in their efforts,
and where there is a perception
of value, there is commitment and
engagement.
My role as leader in the above
situation is to keep the team’s mind
focused on the future, get out of
their way and let them do their thing
and provide an environment that
is conducive to unlimited thinking.
This involves not getting upset when
things go wrong, and they do go
wrong from time to time, but to be
part of the solution by asking, in the
immortal words of Bruce Sullivan,
“What happened? How can I help?”
Given the emphasis on working
towards the future, I do things today
to ensure tomorrow is a successful
day. The one tool I have found
incredibly powerful for this is to say
thank you to team members at the
end of the day for a good days work.
This does two things: it shakes off
the negatives of the day just gone,
and provides the basis for the next
days’ enthusiasm for the task at hand.
Appreciation, it would seem, is a
hidden secret to tap into unlimited
potential. The real not so hidden
secret is that I mean it.
I would be interested in hearing
from anyone who has had similar
experiences, or who employs the
“What happened? How can I help?”
method. u
*Paul is National Credit Manager at Steelforce Australia Pty Limited
“As a leader, it is important to have
a clear vision: a picture that the
whole team can pick up and work
towards.”
Human Resources
10 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
It is often said that credit people
are just one big family and for
Christie Addison, Megan Kernick
and Robyn Erskine this is certainly
true. Credit professionals Megan
Kernick and Christie Addison not
only share the family bond of being
cousins they also share the bond of
choosing credit as their profession.
Christie is Credit Manager at
United Energy & Multinet Gas and
Megan is Credit Team Leader at the
Reece Group. “Aunty” Robyn is an
experienced Insolvency Practitioner
with Brooke Bird and has been
closely involved with the AICM for
many years where she continues to
serve on the Victorian/Tasmanian
council.
We recently caught up with
Christie, Megan and Robyn to find out
just how three members of the one
family have found their way into the
credit profession and what this has
meant for each of them.
What we found is that the pathway
into credit was quite different for
each.
Robyn, an accountant by
profession, has specialised in
personal and corporate insolvency
so while not directly involved in
credit interacts regularly with credit
professionals. She sees the role of
the credit manager as one that is
incredibly important. She says “an
organisation should never under
estimate the value of the credit team.
Without sound credit policies and
processes it can lead to liquidity
problems which in turn can cause
the failure of a business”. Christie
came via what one would consider
the traditional pathway commencing
some 14 years ago as an Accounts
Receivable trainee with Nestle Peters
Ice Cream. Megan on the other hand,
after completing more than half of
a teaching degree, felt she needed
a change and was seeking some
real life hands on experience that
university just was not providing and
was encouraged by Christie to look at
an accounts receivable role.
Obviously one of the great
attributes of the credit profession is
the broad base that people looking to
work in credit can come from which
opens up opportunities for many
different people from many different
backgrounds.
Both Christie and Megan have
enjoyed career growth and success
which no doubt comes from hard
work and commitment. Both
attribute much of their success
to the tremendous support they
have received from fellow credit
professionals who have unselfishly
acted as mentors by giving freely of
their knowledge and helping them
develop sound credit skills. Megan
says “from day one at Reece I have
been challenged to think beyond
what was put in front of me, to
consider why I had reached certain
conclusions and above all to have
confidence in making decisions”.
Christie is also glowing of the support
she has received along her journey
especially during her early years at
Nestle where, as a young credit team
member, she was encouraged by her
supervisor to gain valuable skills in
managing small and large ledgers
progressing to project management
and credit analysis. In turn Christie
now finds herself in the position of
Keeping it in the family
“... I have been challenged to think beyond what was put in front of me, to consider why I had reached certain conclusions and above all to have confidence in making decisions”
Human Resources
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 11
being able to assist with developing
her own team and sees this as one
of the most enjoyable parts of her
current position at United Energy.
Both agree the collegiate
atmosphere in credit has allowed
them to develop and grow
professionally.
Megan says “one of the best parts
of my job are the people I work with.
There is a great culture at Reece and
we all just want to do our best for the
team”.
The AICM has been important in
their careers. Robyn says being part
of the AICM has developed a strong
network of credit professionals which
has stood her in good stead when
appointed to various insolvency
matters. “Knowing you can pick
up the phone and find out how a
particular supply chain works or how
things work in a particular industry is
invaluable”.
Christie rates being a State
Finalist in the YCP Awards in 2004
and 2006 and receiving the Tony
Mamone Memorial Award in 2006 as
some of the major highlights in her
career.
Megan feels the opportunities
her employer has given her by
supporting her membership of the
AICM, allowing her to attend the
various training sessions and the
National Conference each year has
enabled her to grow and understand
the world of credit. Since joining
the credit profession in 2013 she
has been a state finalist in the YCP
awards this year and a member of the
National Credit Team of the Year in
2014.
Personal support is also seen
as important. For Christie, a busy
mother of two small children, juggling
a full on career and motherhood is
challenging. She feels very fortunate
to be given the opportunity to work
4 days per week with 3 days in
the office and one day from home
however being a senior member of
staff this often means that the days
she is in the office are long and on
her day off she spends quite a bit
of her day checking and replying to
emails just to ensure the work that
is needed to be done gets done. The
ability of being able to work from
home does allow her important time
with her family. “Being a working
mum is a juggle. Thankfully I have
a husband that can share the load,
picking the kids up from day care and
getting dinner on the table. I often
feel that we are always racing the
clock and rushing but the kids are
very adaptable and are used to having
two working parents”. She said “the
support I’ve received from United
Energy in giving me the flexibility
needed to be a valuable employee
and a working mother has been really
appreciated”.
Clearly being part of the credit
family has allowed this particular
family to make the most of life’s
opportunities, make great friendships
and develop challenging and
stimulating careers. u
Connect with the right people for trade credit solutions.
• 30 years experience • National coverage • Innovative solutions
• Superior service • Long-term partnerships• NCINet online access
When it comes to credit risk management, navigating the different options requires specialist expertise. And that’s what you get with NCI:
To find out how all this can benefit you and your clients, visit www.nci.com.au, email [email protected] or telephone 1300 654 500 (Aust) and 0800 442 556 (NZ).
National Credit Insurance (Brokers) Pty LtdABN 68 008 090 702 AFS Licence No 233817 Adelaide | Melbourne | Sydney | Brisbane | Perth Auckland | Wellington | Singapore
“the support I’ve received ... in giving me the flexibility needed to be a valuable employee and a working mother has been really appreciated”
Human Resources
12 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
Working in credit control and
collections can be a great career for
many reasons including:
1. It’s a challenging role where
you are able to develop top
communication skills.
2. You can see your results daily. It’s
very rewarding!
3. It is service focused. If you
provide great service to internal
and external clients, you will get
results. In addition, everyone loves
good service so you can make lots
of friends throughout your career.
4. You can make a positive
contribution to your company’s
growth. You can make that as
visible as you wish.
5. It’s possible to see exactly what
you need to do to progress your
career. You can plan your career
from day 1.
6. You can know your own worth in
the job market.
Do I need to be at senior level to know my worth?If you are a junior trainee, an
experienced credit controller or
collector, team leader or manager it’s
almost always possible to understand
your worth to an organisation. That’s
very useful when you are planning
the next steps in your career!
Below are 2 examples of how to
gain an understanding of how much
you are worth to an organisation
using standard DSO and 90+ results.
However, before embarking on a
strategy to reduce DSO or 90+ in
your current or new role, you must
first have an understanding of the
direction your company is currently
taking.
Understand your company’s current business focus:
z What is the current focus around
sales? Is it to increase sales? Keep
sales level? Is the focus controlled
sales growth?
z And what about making a profit
this year? What is the focus
around this? Is growth or profit
currently the most important?
z Is the company borrowing to fund
receivables? What are the costs
involved? Is there lots of cash and
spare funds available?
Understanding the answers to these
type of questions is important for
everyone involved in both the sales
and credit/collection function. To
move any business forward, everyone
in it has to be working towards the
same overall business goals.
When senior management have
signed-off on the current focus of the
business, suitable and realistic DSO
and 90+ targets can be agreed on.
Once they are agreed, a credit policy
and collections plan can be devised to
achieve those goals.
If you work in a credit or
collections environment without
understanding the business focus
you can find yourself working against
some other departments. That type
of situation can be frustrating and
disheartening. It would be very hard
to enjoy your job working in that
environment. For example:
z It may suit a business to hold
shipments if the customer’s
payment is 1 day overdue.
It definitely wouldn’t suit all
businesses. It depends on the
overall business focus.
How do I know my worth?By Jan Reeves MICM^
Jan Reeves MICM
Human Resources
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 13
z It could suit some organisations
to give a customer a 90 day
credit facility, for example if they
are trying to win a new account.
It definitely wouldn’t suit other
organisations.
z Although a particular business
may have trading terms of 30 days
nett, the industry average DSO
may be 60 days. In that instance,
your business may be comfortable
accepting a DSO of 60 days.
Once you have an understanding
of your company’s current business
focus, and what their goals and
expectations are, then you can work
out how you can make the best
contribution. Once you know that it
will be clearer to work out your worth.
Examples: How to work out your worth (Adapt these to your current
environment and circumstances)
Example1:Considering90+balances
(This example is taken directly from a
Sydney based Credit Manager)
When John* joined Ryland Matrix*
as Credit Manager, the ledger he took
over had:
z Total ledger value of $70 million.
z 90+ balance $20 million
Ryland Matrix* are a service
company and operate in a very
competitive environment. Most of
their growth comes from repeat
business and referrals so it was
paramount that the $20m was
collected without upsetting clients.
Using an outstanding customer
service approach, in a just a few
short months, John’s* team were
able to collect $19.5 million of the
90+ balance. The $19.5m went onto
deposit at their bank:
Result for Ryland Services:
1. Extra $19.5 million on deposit at
3% = $48.7K per month (extra
profit $585K per annum)
2. ‘Potential bad debt reserve’
reduced by more than 97%
Result for John* and his team:
1. Much appreciation and recognition
from the Company.
2. Bonuses and salary increases for
the whole team according to their
personal results.
3. Terrific results to add to everyone’s
CV.
Example2.ConsideringDSO
(Example taken directly from a
Western Sydney based Credit
Controller)
When Mary* joined Buckerman
Industrial Pty Ltd* their trading terms
were 30 days from invoice date.
However, the receivables Mary* took
over were:
z Ledger value $5 million
z DSO average for the previous
12 months 68 days.
The brief from the CEO and
Finance Manager of Buckerman*
was to reduce the DSO by 2.5 days
a month to achieve a DSO of 38 days
within 12 months. The business plan
for the next 12 months was reviewed
and a credit/collections plan agreed.
With a structured and customer
service type approach, and without
losing any customers, Mary was able
to reduce the DSO by an average
of 2.5 days each month over the next
12 months.
Result for Buckerman:
1. An average of $183K extra a
month on deposit earning
3% interest = $2.2 million
additional cash in 12 months and
$36K in interest
2. Potential bad debt reserve’
reduced by more than $2 million
Result for Mary*
1. Two bonuses and a pay increase.
2. A great deal of recognition and
thanks from senior management.
3. A marvellous result to add to her
CV.
The key to knowing your worth in
the job market is to be aware of the
results you are achieving. Then you
can relate that to how much cash you
are saving the company, in terms of
interest, either on cash invested or
loans.
The credit/collections function
is hugely important in any business.
Businesses only survive if they are
able to collect their receivables. The
faster they collect their cash the more
money they are able to make.
With a little knowledge and
planning you will be able to see the
results you are having in terms of
hard cash. Learn to understand your
worth and to articulate the important
contribution you are making to the
company.
Know your worth and take control
of your career today! u
*Not their real names
^Jan Reeves has been involved in credit and collections her whole career, most recently as Managing Director of a specialist credit and collections recruitment company. She has now turned her focus to helping small businesses to get all their invoices paid by the due date. Using her experience as a business owner and a Credit Professional she has developed an online collections course, http://getpaidfortheworkthatyoudo.com/ , written especially to guide small business owners.
If you work in a credit or collections environment without understanding the business focus, you can find yourself working against some other departments.
Credit Management
14 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
The Veda Quarterly Business
Credit Demand Index, measuring
applications for business loans,
trade credit and asset finance, grew
moderately by 1.6% in the September
2015 quarter.
Asset finance applications
grew (+6.7%), business loans grew
(+1.8%), and trade credit declined
(-2.2%) in the September quarter
2015 compared to the September
quarter 2014. The Veda Business
Credit Demand Index has historically
proven to be a lead indicator of how
the overall economy is performing.
Veda’s data continues to indicate
moderate growth in credit demand
for business, but showed a slight
decline from the annual growth rate
of +3.7% in the June quarter. Veda’s
General Manager, Commercial Risk
and New Markets, Paul McFadden
said: “With growth in the Australian
economy remaining below trend,
moderate business credit growth
should be seen as a positive.” Overall
business credit applications eased in
the September 2015 quarter (+1.6%).
The softer conditions reflected
across both mining and non-mining
jurisdictions, however, non-mining
states showed stronger demand for
business credit. NSW (+5.9%) and
Victoria (+2.5%) were the strongest
states, followed by SA (+1.7%), ACT
(+1.4%). Tasmania (-12.3%) was the
only non-mining state to experience
contraction. All mining jurisdictions
experienced declining business
credit applications for the September
quarter 2015; Queensland fell by
(-1.7%), WA (-4.5%) and NT (-10.7%).
Business loan applications
eased in the September quarter
to +1.8%. Of the non-mining
jurisdictions NSW (+9.6%),
Victoria (+2.3%), and the ACT
(+2.1%) enjoyed strong growth in
applications, while SA (-1.4%) and
Tasmania (-15.4%) recorded a fall.
Business loan applications
across the mining jurisdictions
Veda Quarterly Business Credit Demand Index (September 2015 Quarter)
Moderate growth of business credit for September quarter• Overall business credit applications rose 1.6% (vs September quarter 2014)
• Business loans (+1.8%) and asset finance applications (+6.7%) grew, trade credit weakened (-2.2%) (vs September quarter 2014)
• NSW’s position as a strong economic performer evidenced in business credit growth
By Paul McFadden*
Paul McFadden
Credit Management
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 15
experienced drops across all states,
with Queensland (-0.9%), having a
modest drop, while WA (-11.1%) and
the NT (-19.0%) dropped sharply in
the September quarter.
Trade credit applications fell
overall in the September quarter
(-2.2%). Trade credit applications
over the past year fell in NSW (-1.5%),
Victoria (-2.8%), Queensland (-5.1%),
Tasmania (-16.1%), the ACT (-4.8%)
and the NT (-8.3%). SA (+5.5%),
and WA (+1.4%) were the only two
states to see growth in trade credit
applications.
The easing of trade credit
applications was largely driven by
weakness in the main category
of 30-day accounts (-4.2%), with
applications for seven-day accounts
(+3.3%) seeing a lift.
Asset finance applications picked
up in the September quarter (+6.7%).
This represented an improvement in
the annual rate of growth for asset
finance applications from 4.0% in the
June quarter.
NSW (+10.7%), Victoria (+9.8%)
and the ACT (+10.0%) saw strong
growth in asset finance applications,
followed by the NT (+2.8%),
Queensland (+2.5%), SA (+1.3%)
and Tasmania (+0.9%). WA (-3.4%)
continues to see falls mirroring
the downturn in mining-related
construction work.
“Changes to accelerated
depreciation rules for small
businesses in May’s Federal
Budget caused a spike in demand
for asset finance for items under
$20,000 in the June quarter.
Changes in Overall Business Credit Demand – Quarterly Year on Year %
*Veda recomputes the entire index over its lifetime every quarter so there will be a slight adjustment to the above historical figures. Veda normalises the date for a like-for-like comparison.
Demand for asset finance
strengthened in the September
quarter (+6.7%).
“While growth in national credit
demand was moderate, NSW’s
position as a strong economic
performer stood out in this quarter’s
credit demand numbers. NSW led
all states in overall business credit
applications (+5.9%), business loan
applications (+9.6%) and asset
finance applications (+10.7%). NSW’s
economy has been underpinned
by growth in the construction and
housing sectors, which have been
performing strongly,” Mr McFadden
said. u
*Paul McFadden is General Manager Commercial Risk at Veda.
“While growth in national credit demand was moderate, NSW’s position as a strong economic performer stood out in this quarter’s credit demand numbers...”
% C
han
ge
Yo
Y
Quarter of Enquiry
7%
6%
5%
4%
3%
2%
1%
0%
-1%
-2% Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3
2012 2012 2013 2013 2013 2013 2014 2014 2014 2014 2015 2015 2015
6.0%
3.7%
2.5%
-1.1%
0.6%
2.4%
-0.1%
4.0%
1.9%
3.1%
3.7%
1.6%
Credit Management
16 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
Any time in credit management that
is not spent communicating with your
customers is time not adding value to
your business.
Customer contact is what makes
your customers pay faster and cash
is the fuel of your organisation. In
our years of experience offering
customers credit management
software we have seen a large portion
of organisations spending excessive
time in pre-call preparation and
prioritisation. By the time you’re ready
to contact you customer it might
be tempting to just send an email
reminder.
But in our view, depending on how
your policies are set up and which
type of relationship you (want to)
have with your customer, phoning can
be more effective than sending an
(e)-mail or text message.
Here are 7 reasons why direct
customer contact is the better way
to achieve results within credit
management:
1. ProactivenessPhoning is a more proactive
approach than an email or a letter.
By phoning the customer you show
that you are committed to your own
cause as well as the customer’s –
collaboratively removing barriers that
are preventing them from paying that
invoice.
2. Getting the right personWhen you call the chances are higher
you will get the right person on
the phone. This is important if you
are dealing with open invoices and
payments. Getting the right person
on the phone gives you instant access
to all the facts and details about the
barriers mentioned above. And this
also allows you to keep your customer
contact information current and
accurate.
3. Direct resultIn our experience no other medium
achieves direct results like a phone
call. When you have your customer
on the phone you can do business
instantly, rather than waiting for
a response to an email or a letter.
It takes the hassle out of putting
next steps in place or letting the
customer decide the next move.
4. Two-way commitment Sending a letter or email asks your
customer for commitment, but it
does not mean that they will give
you that commitment. If you call your
customers and discuss options with
them, you will end up with a two-way
commitment, rather than a one-way
request.
5. Tracking dissatisfaction When you have your customers
on the phone they can feed back
any dissatisfaction that could stem
from an invoice they have received.
In this way you can move quickly
to the root cause of the customer
not paying, provide a solution and
move on.
6. Building customer intimacyYou have an agreement with
your customer. Stick to your
7 quick wins you get from phoning instead of (e)-mailing your customersBy Aroud Visser*
Customer contact is what makes your customers pay faster, and cash is the fuel of your organisation.
Aroud Visser
Credit Management
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 17
policies and processes and let
your customer know that you
are expecting them to keep their
promises. Communicate in a
pragmatic business way but keep
your communication friendly
and personal. So stick to your
agreements but don’t forget
to apply the personal attention
that a customer needs. Personal
commitments by the customer take
promises and performance to a
different level.
7. Picking up on the less obvious signals Speaking to someone allows you to
pick up on emotions and behaviour.
You might be able to detect “hidden
messages” and ask that extra
question to get to the bottom of
the situation. In writing you do not
know whether you are reading fact
or fiction.
All the above steps have
something in common. By creating
customer intimacy you start nudging
your customers in the direction
that you want them to go, by
communicating and understanding.
It is about achieving success through
mutual commitment, rather than
pushing through a process which
could lead to conflict and jeopardize
the long-term relationship.
Sending emails and texts definitely
have a place and can be very effective.
Phone calls can often be seen as the
more time-consuming option. But
appropriate communication is what
we are aiming for.
Modern, focused credit collection
software can help you free up the time
to pick up the phone and call those
customers who need direct contact,
by:
— prioritising which communication
is appropriate for which of your
customers, at which point in time.
— automating your administrative
tasks, to give you more time to
focus on customers. u
Aroud Visser is head of International New Business Development at OnGuard Netherlands. He enjoys sharing exposure to current international ‘best practice’ trends in credit management. Onguard is represented in Australia and New Zealand by Cosyn, OnGuard’s certified Business partner freephone 1-800-123 613 or email [email protected]. Alternatively you can visit www.cosynsoftware.co.nz or follow @OnGuardHQ on Twitter to stay up to date with international best practice.
Credit Management
18 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
Every good people manager will know
the importance of staff engagement
within a business, especially in a high
stress environment like the credit
industry. Every year we all face the
struggles of that ever tightening
budget, revenue targets and client
retention levels. These are a just few
things we are required to take into
consideration every day. While trying
to concentrate on the experience
of the customer and looking after
the people working for you, we are
participating in two completely
different battlefields. Hard work,
right? Well, it shouldn’t be.
As we shift into the silly season we
should start considering the next year
ahead. Now I know what you’re going
to say! You’re still trying to negotiate
Christmas with a smile on your face
and 400 family members invading
your lounge room for lunch on the
25th December.
But trust me you won’t regret
walking into a positive and infectious
environment moving into the New
Year and 2016 in all its glory. Why
not make the change to encourage
productivity and manage a high
performing team?
Richard Branson and other business
royalty alike will agree, they have even
spoken about the importance of their
teams and owe a lot of their success to
the people that surround them.
They also have the view we need
to treat our colleagues and team
members like capable and smart
adults. In doing this they will make
better decisions that will benefit the
business.
Australians work an average of
60 hours a week from the age of
22 – 65. This is over 14 years of our
entire lives in the office! While you’re
digesting that information think
about how much harder it would all
be if the team you worked in wasn’t
a cohesive and functioning unit? You
will consistently fight a losing battle
and none of this is good for the
business you work for, or the people
involved on the ground.
Staff engagement isn’t something
that should be left up to the manager.
This is the responsibility of everyone
in the company. From the CEO
making those sometimes difficult
decisions, to the people a business
can’t live without, which is every
single other person in the company.
Regardless of the size of the teams,
this effects everyone in the exact
same way.
Keep in mind our teams usually
work better when they feel supported
and respected by the company
that pays their salary. We all have a
common goal and we are essentially
on the same team, so why would
working against each other be a
productive environment for anyone?
Driving the employee engagement
can be hard, but when done correctly
the result is extremely satisfying for
both yourself and the team you’re
working with.
To get all this going there are a
couple of very easy things everyone
Staff engagement - its not as scary as it sounds By Stacey Feaver MICM*
Staff engagement isn’t something that should be left up to the manager, this is the responsibility of everyone in the company.
Credit Management
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 19
can do to start moving in the right
direction.
Have your team set their own
values. Take the time to listen to each
individual and what is important
to them to succeed. Your role in
making sure this is an effective
exercise is to steer the conversation
towards tangible results. Encourage
brainstorming, no matter how wild
it may seem. Encourage everyone
to think about their initiatives and
how they can execute these ideas
successfully. Consider leaving them
alone to discuss the different ideas.
If you have given them clear
guidelines of what you are expecting,
and trust them, you will be surprised
with what is presented back to you.
Then, as a group, decide on the three
most important and tangible ideas.
Plan how you’re going to implement
them and place times frames around
it. Be realistic with this, you don’t want
to under deliver.
There are a few different benefits
that come from this exercise. Your
team will feel valued and listened
to, as well as gaining a sense of
accountability and responsibility.
When humans feel like they are
making a difference and their opinions
matter, they automatically participate
more willingly.
Action Plans are a vital part
of making sure you can track and
keep ahead of what you are doing.
The corporate world is constantly
changing, being able to keep track of
where everything stands is paramount
to the success of a business. Delegate
tasks to everyone to play on their
strength as an individual. Have
you got one team member that is
exceptional in a specific task within
the workplace?
Can they transfer this knowledge
to the rest of the team? Why not have
them work amongst themselves to
organise a small training session? Then
follow up on the progress of these
items in regular pulse checks. Once
everyone is satisfied with the outcome,
everyone can agree on the next item to
tackle. Repeat this and don’t stop.
This exercise isn’t designed
to change company policy but
to encourage participation and
responsibility, demonstrate trust and
move in the direction of a team that
work to the best of their ability to
achieve an overall goal.
And the goal for all of us is to be
successful, both individually and as a
business. Remember that we are only
as great as the team we work with.
And from one manager to another, it
worked with my team and it can with
yours. So what will your 2016 look
like? u
Stacey Feaver is State Collections Manager for Austral Mercantile Collections Pty Ltdwww.australmercantile.com.au
“Have your team set their own values. Take the time to listen to
each individual and what is important to them to succeed.”
Legal
20 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
The voluntary administration regime
in Part 5.3A Corporations Act 2001
allows reconstruction possibilities to
be pursued via a deed of company
arrangement (DOCA) in such a way
that, if creditors so desire, a legacy
of debt may be extinguished so that
liquidation may be avoided. Implicit
in that is that the company will
thereby be permitted to return to
mainstream commercial life1 and have
a “fresh start”.
There have been two recent
decisions of the Courts2 that
materially alter the perception of the
position of a secured creditor once
a DOCA has been executed. The
previous thinking was that secured
creditors who did not vote in favour
of a DOCA had an unfettered right
to exercise their security rights over
assets of the company to recover
amounts owed to them.
Recently, two decisions in
Western Australia and New South
Wales have cast some doubt on
the ability of secured creditors
to maintain their debt post the
execution of a DOCA.
The impacts of these decisions are
explored in this article.
Understanding the Legislative FrameworkSection 444A(4)(d) Corporations Act
2001, provides that the instrument
setting out the terms of the DOCA
to be voted upon by creditors at a
second meeting must specify to what
extent the company is to be released
from its debts.
Section 444D Corporations Act
2001, broadly provides that a DOCA
binds all creditors of the company but
does not prevent a secured creditor
from realising or otherwise dealing
with their security interest except in
so far as the DOCA so provides and
the secured creditor voted in favour of
the resolution to execute that DOCA
at the second meeting of creditors of
the company.
The highlighted words above have
particular importance. Firstly, it is
usual that most DOCAs provide that
it will bind all creditors who have a
debt or claim against the company at
the date of administration. However,
nowhere in s444D (nor Part 5.3A for
that matter) is the secured creditor’s
debt referred to as being preserved
post the execution of DOCA. All
that is preserved by the legislative
framework is the right to realise and
deal with a security interest. The
statutory framework contemplates
that the DOCA must state what debts
are to be released and the extent of
such release.
The Components of a Security InterestA security interest also has a
proprietary element, that part of it
which is said to attach to the assets
of the grantor company. That right
allows the secured creditor a right
of action against the property of
the company. It is common for
modern security interests to attach
to present and future (known as after
acquired) property. Thus there are
Impact of Deeds of Company Arrangements on secured creditorsBy Joseph Scarcella MICM*
Joseph Scarcella MICM
Legal
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 21
two proprietary rights, those against
existing assets, and those against
future assets. Further, a security
interest has a personal element, being
a claim against the company itself (as
distinct from the assets) for any debt
owed. At law proprietary rights under
a security interest exists regardless if
a debt is owed to the secured creditor
or not. That is why even though you
may pay off your home loan (the
debt), the bank still needs to release
the mortgage (the security interest)
over your house.
The DOCA in QuestionIn decision of Bluenergy Group
Limited, the particular DOCA provided
(like most DOCAs) that:
z The DOCA binds all persons having
a Claim against the company;
z On and from the commencement
of the DOCA, that all Claims
against the company would be
released and discharged;
z “Claim” was defined to include
a debt or a present future or
contingent claim against the
company;
z A secured creditor could realise or
otherwise deal with their security
except to the extent the secured
creditor voted in favour of the
DOCA or released its security.
A particular secured creditor in
question did not vote in favour of the
DOCA, nor did the DOCA provide.
The NSW Supreme Court had to
consider, amongst other things, if:
(a) The secured creditor’s debt was
released?
(b) If the secured creditor’s security
remained?
(c) If the secured creditor’s security
extended to property acquired
after the DOCA?
Does a DOCA release a secured creditor’s debt? The NSW Supreme Court found that
nothing in the structure of Part 5.3A
Corporations Act 2001 preserved
the debt of a secured creditor if the
DOCA provided that all debts of the
company are to be released without
saying anything about preserving
the debts of a secured creditor.
The reason for this is that s444D only
preserved the proprietary rights of
the secured creditor.
Does a DOCA release a security?Given that the DOCA in question
(and s444D) expressly preserved the
right of the secured creditor to realise
and otherwise deal with its security
interest, the security remained and
still attached to the relevant assets of
the company. However, that security
interest no longer secured any debt
obligation, the debts having been
released by the entry into the DOCA.
Does a DOCA extinguish security over future property?The Court found that the existence
of a continuing security extending
indefinitely into the future over a
company’s after-acquired property,
where the DOCA provided for the
release of the secured creditor’s
debt, would place a very significant
practical obstacle in the way of any
future operation of a company that
emerged after a DOCA, including
potentially preventing the obtaining
of new secured finance. The Court
found this was inconsistent that a
DOCA was to give a company a “fresh
start”. This interpretation places a
restriction on the scope of the assets
available to a secured creditor seeking
to “realise or otherwise deal” with its
security. Only those assets which are
held by company as at the time of
the execution of the DOCA would be
available.
What are the practical implications?
z Secured creditors should ensure
that a DOCA expressly confirms
that their debts are not released.
z Unless debts and security interests
of secured creditors are preserved
by a DOCA, it is likely that secured
creditors will
— vote down any proposals for
a DOCA thus reducing the
prospects of restructures and
companies having a fresh start;
and
— enforce their security interests
immediately (including
by appointing receivers) –
this will limit the ability of
restructures and increase the
costs associated with external
insolvency administrations.
z If secured creditors do not act as
suggested above then companies
entering a DOCA will have a lower
debt burden and a greater chance
of restructure. u
*Joseph Scarcella is a partner at Ashurst in the Restructuring & Special Situations Group in Sydney. www.ashurst.com
FOOTNOTES:
1 Blacktown City Council v Macarthur Telecommunications Pty Ltd (2003) 47 ACSR 391
2 Australian Gypsum Industries Pty Ltd v Dalesun Holdings Pty Ltd (2015) 106 ACSR 79 and In the matter of Bluenergy Group Limited (Subject to a Deed of Company Arrangement) (Administrator Appointed) (2015) 107 ACSR 373
At law proprietary rights under a security interest exists regardless if a debt is owed to the secured creditor or not. That is why even though you may pay off your home loan the bank still needs to release the mortgage over your house.
Legal
22 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
From 12 November 2016 the
protections to consumers from unfair
terms in standard form contracts in
Part 2.3 of the Australian Consumer
Law (ACL) will be extended to small
businesses.
This will apply to the supply of
goods or services other than financial
services or products in the sale or
grant of an interest in land.
Financial services or products
will be subject to identical provisions
in the Australian Securities and
Investments Commission Act 2001.
Why has this happened?When the unfair terms protections
were first put forward in 2009 they
were not confined to consumers
but had been extended to small
businesses. However, following
extensive lobbying (including by the
AICM) the extension to small business
was excluded from the amendments
to the ACL when it commenced
operation on 1 January 2011.
Nonetheless, that extension to
small business remained part of
the Liberal/National Party Coalition
policy. When the Coalition gained
government it signalled its intention to
introduce the extension of the unfair
contract terms provisions to small
business.
Although there was significant
opposition from industry the
government decided to proceed with
the amendments necessary to extend
the Unfair Terms Law to small business.
In the Explanatory Material to the
2015 Bill the following justifications
were put forward for the extension of
the unfair contract term provisions.
z Small business is vulnerable
As they are often offered contracts
on a “take it or leave it” basis and
lack the resources to understand and
negotiate contract terms which leads
to potential detriment where unfair
contract terms are enforced.
z Transfer of Risk to Small Business
Unfair contract terms often allocate
contract risks to the party that is less
able to manage them (usually small
businesses), as they are less likely to
have robust risk management policies
or be in a position to absorb the costs
associated with a risk allocated to
them eventuating.
z Lack of Legal expertise
The cost of obtaining legal advice,
particularly for low-value contracts
can result in small businesses not
entering contracts due to their lack
of confidence in understanding and
negotiating terms. This may mean
they miss out on market opportunities.
z Unfair business dealings laws exist
but not for contracts.
Existing laws largely address ‘unfair’
behaviour in business dealings, rather
than unfair contract terms. Moreover,
the protections available under the
ASIC Act for unfair contract terms are
currently only afforded to consumers
and not businesses.
z More efficient allocation of risk
The extension of the unfair contract
terms protection to cover small
businesses will reduce the incentive
to include and enforce unfair terms in
small business contracts, providing a
Will your terms of trade and contracts be deemed unfair?By David Francis LICM*
David Francis LICM
Legal
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 23
more efficient allocation of risk and
supporting small business’ confidence
in agreeing to contracts.
z Limited to “Low-value” contracts
Small businesses also engage in high-
value commercial transactions that
are fundamental to their business,
where it may be reasonable to expect
that they undertake appropriate
due diligence (such as seeking legal
advice). Limiting the extension to low-
value small business contracts that
are standard form will support time-
poor small businesses entering into
contracts for day-to-day transactions,
while maintaining the onus on small
businesses to undertake due diligence
when entering into high-value
contracts.
The amending legislation was
introduced into the Commonwealth
Parliament on 24 June 2015, passed
both houses on 20 October 2015
and received the Royal assent on 12
November 2015. The Act provides that
it commences operation 12 months
after assent to allow businesses time
to adjust their policies, procedures
and paperwork.
What contracts are affected?The amended law will apply to
contracts entered into or renewed on
or after 12 November 2016 which are:
z standard form contracts
z for the supply of goods or services
(or the sale or grant of an interest
in land)
z between parties at least one
of which employs less than
20 people, including casual
employees employed on a regular
and systematic basis (which makes
it a “small business”, as defined by
the amended Act). If a business
has subsidiaries which are separate
legal entities, employees of its
subsidiaries will not be included in
the employee headcount.
z contracts where the upfront price
payable under the contract is
no more than $300,000.00 or, if
the contract is for more than 12
months, no more than $1 million.
If the contract is varied on or after 12
November 2016, the amended law will
apply to the varied terms.
What is a standard form contract?A contract will be presumed a
standard form contract if a party to
a proceeding alleges that it is. The
burden will be on the other party to
prove otherwise.
The court must consider the
following when deciding whether a
contract is a standard form contract
for the purposes of these laws:
z whether one of the parties has all
or most of the bargaining power in
the transaction
z whether the contract was
prepared by one party for any
discussion occurred between the
parties about the transaction
z whether the other party was, in
effect, required either to accept
or reject the terms of the contract
in the form in which they are
presented
z whether the other party was given
any real opportunity to negotiate
terms contract
whether the terms of the contract
take into account the specific
characteristics of the other party or
the particular transaction.
A court may take into account any
matters it considers relevant, but must
take into account the above.
Credit applications, guarantees and
other security documents are likely
to be standard form contracts for
the purposes of the law. It is difficult
to see how a trade credit provider
relying on a credit application and
guarantee would ever be able to rebut
the presumption that those documents
were standard form contracts.
What contracts and terms are excluded?
z Contracts entered into before 12
November 2016 (unless rolled over
or renewed on or after this date).
z Shipping contracts.
z Constitutions of companies,
managed investment schemes or
other kinds of bodies.
z Certain insurance contracts, such
as car insurance.
z Contracts in sectors exempted
by the Minister (none declared as
yet).
z Terms that define the main subject
matter of the contract.
z Terms that set the upfront price
payable under the contract.
z Terms that are required or
expressly permitted by law of
the Commonwealth, or a State
or Territory. My view is that a
retention of title provision giving
rise to registration of a purchase
money security interest under the
PPSA is such a term.
What is an unfair contract term?There are three limbs of unfair
contract terms, the Act says that a
term of a small business contract is
unfair if it:
z would cause a significant
imbalance in the parties’ rights
and obligations arising under the
contract (1st limb); and
z it is not reasonably necessary in
order to protect the legitimate
interests of the party who would
be advantaged by the term (2nd
limb); and
z it would cause detriment (whether
financial or otherwise) to a party if
it were to be applied or relied on
(3rd limb).
Credit applications, guarantees and other security documents are likely to be standard form contracts for the purposes of the law.
Legal
24 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
These 3 limbs must be proven by the
small business in order to escape the
alleged unfair term.
However, for the purposes of
proving the 2nd limb, a term of
the contract is presumed not to be
reasonably necessary in order to
protect the legitimate interests of
the trade creditor (who would be
advantaged by the term), unless the
trade creditor proves otherwise.
In determining whether a term of
a consumer contract is unfair, a court
may take into account such matters as
it thinks relevant, but must take into
account the following:
(a) the extent to which the term is
transparent;
(b) the contract as a whole.
Transparency of a term A term is transparent if it is expressed
in reasonably plain language, legible,
presented clearly and readily available
to any party affected by the term.
Terms that may not be transparent
include terms that are hidden in
fine print or schedules, or that are
phrased in legal, complex or technical
language.
The contract as a wholeWhile a term in isolation may indicate
it is unfair the court will consider it in
light of the contract as a whole. Some
terms that might seem quite unfair
in one context may not be unfair in
another. Conversely, if a particular
term was decided by a court in one
case to be fair, this does not mean it
will always be fair.
For example, a potentially
unfair term may be included in a
small business contract but may
be counterbalanced by additional
benefits – such as a lower price –
being offered to the small business.
However, favourable terms may
not counterbalance an unfair term if
the small business is unaware of them,
for example, implied terms, terms
hidden in fine print, in a schedule,
in another document or written in
legalese.
Other mattersThe ACL provides that the court may
also take into account such other
matters as it thinks relevant. It is
likely that the court would take the
following matters into account in most
situations:
z pre-contractual conduct of the
parties
z other options available to small
business at the time of the
contract
z the notice given to small business
customers about the terms of the
contract, particularly any unusual
terms
z any explanation given to small
business customers about the
terms of the contract
z whether a small business had
reasonable opportunity to consider
the terms before concluding the
contract; and
z whether small business should or
could have sought professional
advice before entering into the
type of contract in question.
Section 25 of the Act also provides
13 or 14 examples of the types of
terms of the contract that might be
unfair. However, space does not allow
those to be set out.
Enforcement of the new lawThe ACCC and state and territory
consumer protection agencies share
responsibility for enforcement of the
unfair contract terms protections for
small-business goods and services.
ASIC is responsible for enforcing the
protections in relation to financial
products and services.
If a trade creditor sues a small
business to collect a debt and the
court makes a declaration that a term
is unfair, that term is void and cannot
be relied on by the trade creditor as
part of the contract.
What to do during the transitional period?The following are brain-storming
ideas, not advice.
z Use the next 12 months to change
the structure of your credit
documentation distinguishing
between security terms (which you
won’t change) and trading terms
(which you may change).
z If you rely on guarantees with
charging clauses, be sure you
have them all in place with all the
customers you want them from by
11 November 2016.
z Conduct a survey of your customer
base to work out how many fall
within the small business definition
(i.e., fewer than 20 employees)
so you can develop an informed
strategy.
z If you want to rely on your current
terms and conditions for customers
with 20 or more employees, decide
if you want to develop 2 sets of
terms, one for small business and
another for the rest. My view is that
will be unworkable.
z Work out what terms can be
mutualised without too much
harm (e.g., unilateral variation) and
change them to avoid needless
hassles.
z Alternatively, and despite
the avowed purpose of the
amendments, consider if there is
any point at all in amending your
terms and conditions. A lot of the
time you won’t know on the day
of contract whether customer had
fewer than 20 employees. It may
be that the credit policy will need
to be adjusted to allow negotiation
if it seems that the small business
can prove it.
z Develop a process to annually
monitor small business customers
so that if a customer moves from
less than 20 employees to 20
or more employees the relevant
terms and conditions can be varied
so that the contract is outside the
Unfair Terms Law.u
*David Francis is a Solicitor and Director of Francis Commercial Lawyers Pty LtdTel: (02) 9587-9002 Fax: (02) 9587-9003Email: [email protected]
Legal
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 25
printed on the invoices issued
by the Supplier which included a
standard ROT clause. The Terms
and Conditions of Supply were not
attached nor did they form part of
the Credit Application.
z The Supplier supplied to the
customer from September 2008
to May 2013 when an administrator
was appointed to the Customer.
z The Supplier did not register its
security interest over the goods
supplied and the subject of the
case.
z The Supplier was unsuccessful at
trial. The Trial Judge determined
that each invoice for supply was
a separate contract. The relevant
separate contracts came into
effect after 30 January 2012, and
the transitional provisions of the
Personal Property Securities Act
(‘the Act’) did not perfect the
contracts.
Summary of the decision of the Court of Appeal
z The Court of Appeal overturned the
Trial Judge’s decision.
z The Credit Application did not
create a contract between the
Supplier and the customer.
However the contract between
them was formed when the supply
took place. The customer did
not become bound by the Credit
Application Terms until the first
supply of goods after the Credit
Application was made.
z The Supplier’s supply of goods
was acceptance of the customer’s
application for credit by conduct.
The delivery of the goods which
the customer had ordered and the
sending of the invoice confirmed
that the supply was on 30 day
credit and this was the conduct
through which ‘the supplier
signified its acceptance of the
customer as an account customer’.
The sending of the invoice was the
critical step which confirmed that
credit was being provided.
Commentary z The PPSA requires a formal
security agreement to be in place
before supply of goods.
z The Court considered that a formal
agreement for all future supplies
of goods existed. In this case the
formal agreement consisted of the
Credit Application and the invoices
which contained the Terms and
Conditions of the Sale.
z Usually the Terms and Conditions
of Supply would form part of
the Credit Application and the
Terms and Conditions of Sale
would either be included in or be
attached to the Credit Application
at the time the customer signed
the Credit Application.
z This decision may provide some
comfort to suppliers where
they rely on Credit Applications
similar to those in this case and
also possibly where the Credit
Application cannot be found but
there are documents such as
emails and invoices which contain
terms which can be inferred as
constituting a formal security
agreement. u
*Frank Gambera is Director for McMahon Fearnley Lawyerswww.mcmahonfearnley.com.au
Case note
By Frank Gambera MICM*
Frank Gambera MICM
Central Cleaning Supplies (Aust) Pty Ltd -v- Elkerton [2015] VSCA 92
The Court of Appeal of the Supreme
Court of Victoria has upheld the
security interest of Central Cleaning
Supplies (‘the Supplier’) over the
supplies of cleaning products and
equipment (‘goods’) to Swan Services
(‘the Customer’).
Summary of facts z The customer in 2009 completed
and signed ‘An Application for
Commercial Credit Facilities’ which
was required before the supplier
would supply goods on 30 day
terms.
z Clause 2 of the Credit Application
provided ‘The supply of goods
by the seller is governed by
the seller’s Standard Terms and
Conditions as in force from time
to time’.
z The Supplier’s Terms and
Conditions of Supply were
26 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
PPS
Small to medium hire and rental
businesses will benefit from reduced
PPSR costs, thanks to changes to
the Personal Property Securities Act
2009.
What has changed?From 1 October 2015 the changes
reduced the number of leases that
hire and rental businesses need to
protect with PPS registrations.
Previously leases of serial-
numbered goods (such as cars, trucks,
caravans, cranes and watercraft)
lasting more than 90 days but less
than 12 months were deemed PPS
leases and needed to be registered.
On 1 October 2015 the definition
of a deemed PPS lease was narrowed.
Now leases of serial-numbered goods
of less than 12 months may fall outside
the definition and no longer need to
be registered on the PPSR.
This makes the treatment of leases
of serial-numbered goods and non-
serial-numbered goods consistent. For
many businesses the outcome will be
less confusion, fewer registrations and
lower costs.
What has not changed?The law reform won’t apply to leases:
z With a term of more than
12 months;
z Capable of being renewed
beyond a 12 month term;
z Of an indefinite term;
z Entered into before 1 October
2015.
It’s important to seek legal advice in
relation to your specific circumstances
to understand the action you should
take. u
*Moses Samaha is General Manager, Commercial/Property Solutions & B2B Channels at Veda. www.veda.com.au
Lower PPSR costs for equipment hire businessesBy Moses Samaha MICM*
Moses Samaha MICM
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 27
PPSR
The Australian Financial Security Authority (AFSA) is
the body responsible for administration of the Personal
Property Securities Register and they released a new
guide designed to increase awareness of the Personal
Property Securities system on 13 November 2015.
The Guide was created by Associate Professor David
Brown from the University of Adelaide.
Mr Brown is co-author of the book Australian Personal
Property Securities Law (LexisNexis, 2012) and he teaches
and writes on the Personal Property Securities Act,
insolvency law and property law.
An acknowledgement is given by Mr Brown to James
Neate (AICM Director and Law & Legislation chair),
Gail Crowder (AICM SA Division President) and several
other AICM Members and CCE’s for their assistance in
participating in a feedback group coordinated by James
Neate.
The feedback group provided firsthand accounts of
issues that Members face and their real world experiences
of difficulties and lack of broader understanding of the
existence and operation of the Register.
This guide is targeted at small businesses, their
accountants, financial advisers and lawyers. It was released
by the AFSA Chief Executive, Veronique Ingram who said
“Our new business guide – titled Are you in business? – is
intended to help Australian businesses not familiar with the
practical implications of this law”.
“It also explains how they might benefit from using the
national online system – the Personal Property Securities
Register, also known as the PPSR” Ms Ingram said.
The guide is well designed and clearly explains some
of the basic concepts including clarifying that “Personal
Property” relates to Goods and/or Assets and “Securities”
relates to Debt.
The guide may be useful for credit professionals
attempting to educate team members and colleagues
about the importance of the PPSR or to pass on to
their customers to assist with their understanding of
the PPSA.
Gavin McCosker, Registrar of Australia’s Personal
Property Securities system, said “The business guide is
designed to present information on the law and the PPSR
in a way that is easy to understand”.
“We’ll build on the release of the business guide with
the regular development and release of more resources
– including products tailored for specific sectors – through
a variety of channels,” he said.
The PPSR business guide is available on the PPSR
website (www.ppsr.gov.au).
The AICM joins Mr Brown in thanking the following
AICM members for assisting with this guide:
z Gail Crowder, Executive Director, Kemps Credit
Solutions, and President SA Division AICM;
z Nigel Hillier CCE, Credit and Administration Manager,
Coopers Brewery;
z Anne Wilkins CCE, National Credit Controller, FMG
Engineering;
z Nick Pontikinas, FP&A and Collections, Boart Longyear;
z Kerry Hammill CCE, Consultant, AMA Collection
Services;
z Trevor Goodwin CCE, Manager Credit Services, National
Credit Insurance (Brokers) Pty Ltd;
z James Neate MICM, Partner, Lynch Meyer, and Director,
AICM. u
AFSA launches new PPSR guide for business
BEFORE YOU SAY “NOTHING TO DO WITH ME”‘Personal Property’ and ‘Securities’ are legal terms.
This roughly translates to:
28 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
PPS
As credit managers will know, since
January 2012 Australia has had a
complex new law about security
interests – the Personal Property
Securities Act 2009 (Cth) (PPSA).
The PPSA has put in place a whole
new landscape for retention of title
sellers and other owners who seek to
recover their goods in the insolvency
of the customer.
If a PPSA registration is not made
to the letter of the law, then title to
the goods supplied can be lost under
the vesting and priority rules in the
PPSA. The effect on the hire industry
has been particularly dramatic as
hires can be deemed to be ‘security
interests’.
The Whittaker ReportA review of the PPSA was tabled in
Federal Parliament in March 2015.
However to date nothing has been
adopted.
What is clear from the Report is
that the PPSA is excessively complex.
There are many questions in the
registration process which have
little meaning in practice but which,
if wrongly answered, could render
the registration invalid and expose
businesses to loss of ownership
of goods in the insolvency of their
customers. In our view little effort was
made to make the system accessible,
simple or intuitive. The legislation
itself is also loaded with exceptions
and special rules.
The Report finds that all this has
meant the PPSA has not delivered the
benefits it was intended to.
The Report proposes (amongst
many other things) a substantial
simplification of the register. It
recommends removing or simplifying
many of the inputs to a typical
PPSA registration. It recommends
removing:
z The box that indicates whether
the interest is a ‘purchase money
security interest’ (PMSI). More
about that below.
z The question whether the
collateral is consumer property
or commercial property.
z The question whether the security
interest is subordinated.
z The question whether proceeds
are claimed. This is a confusing
question and no-one ever answers
‘no’ to it except by mistake.
z The question whether the
collateral is inventory. Another
misconceived question which
for highly technical reasons we
won’t go into here.
z The requirement to register
against the ABN of certain
corporate customers acting as
trustees of trusts. Creditors will
not have to negotiate the difficult
issue of whether they have been
dealing with a trust or not.
What about hire?
The hire industry is undoubtedly
the victim not the beneficiary of the
PPSA. The industry continues to
advocate for the PPSA to be amended
to exclude hire, so as to prevent
more losses of hired equipment in
customer insolvencies. The Whittaker
The money or the box – reforming a perplexing PPSABy Oliver Shtein*, Executive Lawyer, Bartier Perry
Oliver Shtein
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 29
PPS
recommendations fall far short of
what the industry wanted. The Report
recommends that indefinite hire or
lease no longer be a deemed security
interest and that a uniform period of
one year’s actual hire be the entry
point to the PPSA. However this still
cuts across the hire industry where
certain kinds of goods (site sheds,
vehicles, formwork, generators etc)
can sometimes be deployed for
more than a year especially on larger
projects.
So even if the Report is adopted,
hire businesses will still stand to lose
the ownership of capital assets that
they hire out with these assets being
made available to banks. In fact the
Report specifically recommends
preserving the right of the banks to
claim hired assets. If the customer
is a large one this can be (and has
been) fatal to hire businesses.
How would PPSA’s casualties fare under a post-Whittaker PPSA?From a review of the decided Court
cases in Australia and some of our
own files we have compiled a short
list of PPSA mishaps and asked how
suppliers would fare if the PPSA were
amended as the Whittaker Report
proposes.
The Maiden Civil case –
NSW Supreme Court
In this case a company (QES)
hired two caterpillar excavators to
a construction business (Maiden
Civil) which became insolvent. The
excavators were successfully claimed
by the receiver appointed by a lender
to Maiden Civil (Fast Finance) even
though the excavators were never
actually property of Maiden Civil.
QES suffered the loss of its
excavators because the hires were
of motor vehicles for more than 90
days and QES made no registration
against Maiden Civil. The 90 day
period was changed to one year by
legislation in 1 October 2015. But the
same result would obtain under the
Whittaker recommendations if the
hires were for more than a year.
The Doka Formwork case –
Victorian Supreme Court
Doka was a formwork hire business
that lost about $1million in formwork
in the insolvency of a builder
customer. Doka was caught by PPSA
because it had the formwork out on
indefinite hire. Under Whittaker it
would only be caught once the one
year threshold is crossed.
Doka actually had made a
registration but it was one day
late. Doka fell foul of a rule in the
Corporations Act (section 588FL) that
applies in parallel to PPSA. The rule
in 588FL applies if no registration is
made within 20 business days of the
security agreement.
Whittaker recommends that
section 588FL be repealed. Cold
comfort.
Spiers Earthworks –
West Australian Supreme Court
Spiers lost valuable plant and
equipment which it had sold on a ‘rent
to buy’ basis as part of a business sale.
The hirer/purchaser became insolvent
and the equipment was taken by the
hirer/purchaser’s bank.
The security interest was security
‘in substance’ – not time dependent.
As with retention of title there needed
to be a registration under PPSA. The
Whittaker Report would not change
this outcome.
Retention of title supplier A –
the money or the box
This new client of ours had resolved
to tackle PPSA registration without
specialist advice. It supplied several
million dollars’ worth of its product to
a business which became insolvent
having paid for virtually none of it.
The client made a registration but
didn’t tick the PMSI (‘purchase money
security interest’) box. A bank took an
‘all assets’ security for a refinancing
of the customer. The bank made its
registration before the client’s. The
bank has claimed priority over the
product supplied – essentially because
the PMSI box wasn’t ticked.
The Whittaker Report
recommends the PMSI box be
abolished. as the Report finds it was
never necessary in the first place. The
PMSI box has been a source of many
other PPSA mishaps especially in
the hire industry where it is often not
appreciated that a hire of goods is
deemed by the law to be a PMSI.
Retention of title supplier B
This hire company client of ours had
agreed equipment hire terms with
Company X and had made a good
registration against Company X.
However a few months into the hire,
there was a ‘business restructure and
transfer’ in the customer group. Our
client was asked to stop invoicing
Company X and to invoice related
company Y instead. Not thinking too
much about PPSA, the client obliged.
Company Y then became insolvent
and its liquidator claimed that the
client was a supplier to Company
Y against which it had not made a
registration. This case will turn on its
facts but in this kind of case if there
was truly a new contract for supply on
retention of title to Company Y there
needs to be a registration against
Company Y.
ConclusionIf and when the Whittaker
recommendations are adopted they
will bring a welcome simplification to
the register. They will not do much for
those who are oblivious to PPSA or
not very attentive to the complexities
and pitfalls that will remain.
Some businesses will look back
and wonder why they were caught by
rules that were never needed in the
first place. u
*Oliver Shtein is a corporate and commercial lawyer and leads Bartier Perry’s PPSA team. He is the adviser to Australia’s Hire & Rental Industry Association on PPSA issues and PPSA reform since 2011. Ph: (02) 8281 7868, email: [email protected]
30 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
2015 National Conference
Vicki Writer, founder of The 360° Solution™.
YCPA Finalists – David Brennan (WA), Tate O’Connor (SA), Patrick Barry (Vic/Tas), Michael McDowell (Qld) and Kimberley Hale (NSW)
Dr Craig Latham, Deputy Australian Small Business Commissioner
Credit Managers Panel. 5 CCE’s.
Nerida Caesar, Veda.Panel of Economists M. Witts (ING Direct), P. Bloxham (HSBC), J. Fabo (ANZ) and A. Stabback (AB+F magazine)
Debbie Piening MICM, Caltex Credit Team of the Year Winner.Moses Samaha MICM, Veda.
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 31
2015 National Conference
Clarke Butler, CEO of D&B.
James Neate MICM – Conference MC.
Delegates at the Conference.
Michael Seddon, ATO and Adrian Brown ASIC.
Adrian Heath.
New and recertifying CCE’s.
Darin Milner MICM, D&B. Victor Walter QBE.
To see all the conference photos please go to www.creditnetwork.com.au/photo-gallery/
Please note: you need to be registered to see all photos. Registration is free.
Legalaicm Training News
Australian businesses are dynamic and constantly
changing and the workforce needs to be as well.
Progressively higher levels of language, literacy and
numeracy (LLN) are required to respond to increasing
skills requirements in order to adapt to change and
expand your business.
International surveys and research in this area indicates
that there are significant LLN issues for the workforce.
The findings paint a disturbing picture. 93% of surveyed
employers identified a wide range of impacts on their
businesses from low level literacy and numeracy skills.
The most significant impacts were inadequate
completion of workplace documents and reports (21%),
time wasting (17.7%) and materials wastage (11.5%). In
addition, employers indicated what corrective measures
they had tried. Over 30% of companies provided internal
company training and 20% offered skill development
support.
Why are workplace language, literacy and numeracy skills important? Modelling undertaken by the Australian Workforce and
Productivity Agency indicates an increased industry
demand for higher level skills. This will be difficult to
achieve with 4.2 million, or 40% of the workforce currently
below the minimum language, literacy and numeracy
(LLN) standard needed to function in a knowledge
economy. Building LLN skills is critical to increasing labour
force participation and increasing productivity in a higher
skilled economy.
Australian workplaces are dynamic and constantly
changing. The workforce needs to respond to increasing
skills requirements brought about by new technologies,
new work processes and increased compliance and
quality assurance measures. Progressively higher levels of
language, literacy and numeracy are required to support
this.
What is the current situation? In 2006 the Australian Bureau of Statistics (ABS)
conducted the Adult Literacy and Life Skills survey. Just
over half (54%) of Australians aged 15 to 74 years have
been assessed as having the literacy skills needed to
meet the complex demands of everyday life and work.
Results were similar for document literacy (53%) and
numeracy, with 47% achieving this level. Major attention
was devoted to this issue in the wake of the survey
which found that many Australians were below level
3, generally accepted as the “minimum required for
individuals to meet the complex demands of everyday
life and work in the emerging knowledge-based
economy.”
What are employers saying? The Survey of Workforce Development Needs 2012
addressed the issue of workplace literacy and numeracy.
Specifically, the survey asked about the impact of low
literacy and numeracy skills on business and what
measures have been used by workplaces to make
improvements in this area. In relation to the impact of
low literacy and numeracy skills on business, employers
reported experiencing:
z Inadequate completion of workplace documents or
reports = 21.1%
z Time wasting = 17.7%
z Material wastage = 11.5%
z Recruitment difficulties = 8.3%
z Financial miscalculations = 6.8%
z Ineffective work teams = 6.7%
z Not applicable to the business = 6.6%
z Staff unable/unwilling to take on new work/tasks =
6.4%
z Non-compliance = 6.3%
z Staff lack confidence = 5.2%
Over 93% of surveyed employers identified a wide range
of impacts on their businesses. Only 6.6% of employers
thought that this issue was not applicable to them.
These results are very similar to those reported in
a previous survey undertaken as part of the National
Workforce Literacy Project.
Across industry sectors there was some variation
from the effects of inadequate LLN capabilities.
Inadequate completion of workplace documents and
reports was shown to be most strongly experienced
across construction (22.4%), mining (21%) and services
sectors (20.4%). Time wasting was also a large issue
for mining (19.4%) and construction (19%) compared to
manufacturing (16.2%) and services (14.5%).
Drive and expand your business into the future with language, literacy and numeracy skills
32 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
Legal
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 33 December 2014 • CREDIT MANAGEMENT IN AUSTRALIA 33
aicm Training News
Recent Graduates
Eleanor TierneyLu WangNeal HinrichsenSong Hua ZhouKylie WongSurashri PujariMichelle ZhangSavona FergusonMichelle McKenzieNicolle HewatHelena SpicerBetty CurtisSandra EstephanNicole StormRebecca HolleyAlexandra DaleTracy DoSophie LiuEmma HillKayla LopezIiona Ter-StepanovaAllison ParryEmma HillHeather PfitznerKerrie Adams
Manufacturing experienced the highest levels of
materials wastage (14.2%) followed by construction
(13.8%) and mining (8.1%). Staff being unable/unwilling
to take on new work and ineffective work teams most
affected the manufacturing sector, 10.3% and 10%
respectively, while low levels of LLN impacting on
MELBOURNE
10th February – Implement risk
management strategies (C,4)
11th & 12th February – Manage
factoring and invoice discounting
arrangements (E,D)
21st & 22nd March – Legal Compliance
(C,D and 4)
14th April – Personal Insolvency (C,D)
13th April – Manage overdue accounts
(C,4)
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
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)
SYDNEY
18th & 19th February – Manage
factoring and invoice discounting
arrangements (E,D)
10th March – Manage risk and policies
and procedures (C,D)
11th March – Implement risk
management strategies (C,4)
17th & 18th March – Legal Compliance
(C,D and 4)
21st April – Personal Insolvency (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.
2015 – 2016 Face to Face Training Calendar
recruitment difficulties (10.6%), financial miscalculations
(9.8%) and non-compliance (8.1%) were most strongly felt
in the services sector.
The AICM’s Certificate and Diplomas are being
updated to ensure they also equip students with LLN skills
as well as Credit skills.
For further information:https://www.ibsa.org.au/sites/default/files/media/No%20More%20Excuses%20ISC%20response%20to%20LLN%20challenge.pdf
aicm Can We Help?
34 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
Answer:Businesses that provide commercial trade references to other
businesses may have obligations under the Privacy Act (Cth)
1988. Unless a business is not required to comply with the
Privacy Act (because it falls within a specific exemption) the
13 Australian Privacy Principles (APPs) of the Privacy Act will
apply to a business that collects, holds, uses and discloses
personal information. That is, any information about a
reasonably identifiable individual.
Even when dealing with a company, obligations under the
Privacy Act should be considered. This is because a company
cannot actually do anything – it needs individuals to carry out its
business activities and operations. So even business to business
exchanges will involve dealing with people – and if you collect,
hold, use or disclose information about those people (such as
business cards from a company’s sales representatives), the
Privacy Act may apply. However if you have or give a trade
reference that only contains information about a company, then
Privacy Act obligations will not apply to that reference.
As a general principle the APPs do not prevent businesses
from doing this with personal information – they do require
transparency, so that the people know why their personal
QuestionMy company provides goods and services to other businesses
ie all of my customers, be they a sole trader, partnership or
company have provided me with their ABN and my goods are
generally for business purposes.
On which of my customers may I provide a commercial trade
reference and to whom?
What are my obligations if I provide a commercial trade
reference to another supplier of a customer ie:
z must I keep a copy of the reference, and if so for how long?
z must I divulge to the customer the fact I have provided a
trade reference?
z must I produce a copy of the reference if so demanded by
the customer?
What are the obligations on the requesting party ie:
z must he keep a copy of the reference?
z with whom may he share the information eg internally,
externally?
z must he produce a copy of the reference if so demanded by
the customer?
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
information is being collected, what you will do with it, who you
will disclose it to – and how you will keep it secure. A business
can generally collect, use and disclose personal information
when reasonably necessary for its business activities. You
should have a publicly available privacy policy that make your
personal information handling practices clear.
If the Privacy Act applies, a person has the right to ask you
for access to personal information you hold about them (which
could be personal information contained in a trade reference).
Exceptions may apply to granting access as requested.
Under the Privacy Act you must destroy personal information
when you know longer need it for your business activities. In
other words, if you no longer need it for any of the reasons you
collected it, you should destroy it. However there may be other
laws (such as tax laws) that require you to keep it for longer.
Care should be taken to ensure that the exchange of trade
references doesn’t involve exchanging any information about
a person that is about their history or activities in relation
to consumer credit – unless you have fully considered the
implications under the Privacy Act. For example, if a business
provides trade terms to a company, it may want to get
consumer credit reports about the directors as part of its credit
assessment. If so, then that business must also comply with the
credit reporting provisions of the Privacy Act (Part IIIA) that
apply to getting the reports and handling of any information in
them.
The Privacy Act requirements are complex and you should
seek professional advice about how the they apply to your
business. This article is for general information purposes only
and should not relied upon in any way as advice.
Debra Kruse
Principal Consultant
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 35
AR
OU
ND
TH
E S
TA
TE
SNew South Wales
ARMA Recoveries and CreditorWatch AICM National Golf Day wrap upOn Tuesday the 13th of October the AICM held the combined NSW and
National Conference Golf Day at Oatlands Golf Club who again put on
a great show despite some rain. This was the first official activity of the
AICM National Conference and the day was very successful.
We had over 100 players across 26 teams and the competition
was fierce with the BBW Lawyers Team taking out the major prize just
ahead of the Veda A Team led by Gary Forest who finished a close
2nd. Team Debt Sale Brokers Australia (DSBA) finished 3rd which still
puzzles me as team captain Adam Dayeian (Owner and CEO DSBA)
much prefers to kick a soccer ball rather than swing a golf club. BBW
scored a course record that was highlighted by an eagle at the 12th
(Par 5) after they chipped in from 110 metre’s out (the shouts could
be heard all around the course). We accepted their score only after
requesting sworn affidavits from each of them.
Team Byron Thomas took out the coveted NAGA prize for the
highest aggregate score and I’m not sure Team Captain Peter Morgan
(Owner Byron Thomas) will be taking up golf any time soon.
A massive thanks to all 22 sponsors on the day. The main reason
why the day was such a success was due to the large number of
sponsors who used the event as an opportunity to bring along their
Creditor Watch Team.
Bing Team.
Turks Legal Team.
Peter Mills, Maureen Grant, Greg Young and John Shanahan.
36 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
AR
OU
ND
TH
E S
TA
TE
SNew South Wales
customers and staff for a great day of networking and fun. It’s
rare that you get an opportunity to spend 5-6 hours with a
customer discussing life and business.
We also wanted to take this opportunity to thank our
NSW President, Colin Magee, who spent countless hours
organising the golf day and wasn’t able to attend due to the
sudden loss of his father. Col, we all toasted you and your
father after the game. I’m sure he would be very proud of
your achievements over the past 12 months where you lead
the NSW AICM Council to victory with the President’s Trophy
at the National Conference. It’s certainly no coincidence that
this award was won by NSW in your first 12 months as the
NSW President.
A big thank you to all the other volunteers who gave up
their time to make the event a success, you know who you are
and you are loved.
WINC High TeaOn the 25th September we hosted the second NSW
WINC event. The event was a delicious High Tea held at
the beautiful Deloitte Building in the Sydney CBD. Nicole
Wales, from Human Tribe (formerly Emerald City Consulting)
was our wonderful guest speaker. What a lady. Nicole
is the Founder and Managing Director of Human Tribe,
a Human Performance Specialist Company that partner
with people and business to reach their highest potential
and purpose through coaching, measuring, aligning and
inspiring.
Nicole took us on a journey looking at the successes and
challenges faced in her career which included operating
three Fernwood fitness centres, employing over 100 people
at any one time. She also worked in Human Resources
and Learning and Development for over 12-years across
Patrick Goghlan and Nick Pilavidis.
Happy golfers.
Putting competition.
Mark Logue and Treacy Sheehan.
Putting competition. WINC High Tea.
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 37
AR
OU
ND
TH
E S
TA
TE
SNew South Wales
the hospitality, retail, banking and television industries in
both a senior management and executive level. She is well
versed in managing how to achieve a good work/life balance
and also how to be a more effective leader. Some of the
take away points of the discussion were the importance of
making time for yourself, prioritising tasks and relationships,
and the need to ask for, as well as accept, help from others.
The relaxed casual atmosphere allowed Nicole to open up
and share personal values and insights to the group who in
turn responded with questions of relevance. It was thought
provoking and engaging.
Beth Gray (WINC NSW Committee) delighted us with
her wit and MC’ing and we think we’ve found a new career
for her as a Bingo caller (legs eleven). Our WINC days also
support the Dress for Success (DFS) organisation. We heard
from Beverley Brock MD, about the great work Dress for
WINC guests.
WINC guests.
Beth Gray and Nicole Wales.
Nick Pilavidis, Beth Gray and Beverley Brock.
WINC guests.
Amanda Borland, Treacy Sheehan, Beth Gray, Beverley Brock and Susan Day.
Success does to promote the economic independence of
disadvantaged women by providing professional attire, a
network of support and the career development tools to
help women thrive in work and in life. With the support of
sponsors and Beth’s fabulous commentary the raffle raised
over $1,300 at the event. www.dressforsuccess.org. Thank
you to the generous supporters of the lucky door prize
(Australian Recoveries and Collections Pty Ltd), and raffle
prizes (Fresh Catering, Trace Personnel, Hoyts Cinema,
Simon Johnson, SAP User Group, Pacific Magazine and
Simpson Cottage).
Thank you for supporting the launch of the WINC events
this year and we look forward to seeing you all at the 2016
AICM events especially all of the WINC days. If you’d like to
share more ideas on events you’d like to have please let us
know and email: [email protected].
38 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
AR
OU
ND
TH
E S
TA
TE
SNew South Wales
Getting to know
Adam Clarke
National Credit Manager,
StarTrack, MICM & NSW
Council Member
How did you get involved
in the Credit Industry and in
what capacity have you been
a credit professional?
I started in Credit at a
company named Discount
Freight Express (DFE) at
the ripe old age of 19 after
completing Certificate IV in
Accounting at Baulkham Hills
TAFE. I have been working in Credit coming on 16 years.
My first role was a Credit Clerk which later progressed to
Credit Officer, Assistant Credit Manager, Regional Credit
Manager and now National Credit Manager.
How long have you been involved with the AICM,
on Council and other?
I have been involved with the AICM for 4 years and have been
newly appointed on the Council.
Why did you get involved on Council?
To give back and add value to the AICM and the Credit Industry
that has been so good to me. I believe you should always give
back and pay it forward as my mentors and predecessors have
done for me. Giving back is the ultimate reward.
What part of the world do you come from?
Probably another planet other than Earth – LOL, just joking!
I was born in Sydney and have Irish and French background
from my mother’s side and Hungarian and German from my
father’s side. I like to mention the French part to substantiate
why I am such a good lover
What is your favourite movie quote?
Oh it has to be “Get to the chopper” by Arnie Schwarzenegger
from the movie Predator. Another great one is “You can’t
handle the truth” by Jack Nicholson from the movie A Few
Good Men.
What sport/team do you barrack for?
My favourite sport is Basketball and I am a HUGE NBA fan.
I don’t necessarily follow a team essentially (originally it was
Chicago Bulls and more recently the Miami Heat), I tend to
follow players so if they switch teams so do I. The GOAT
(greatest player of all time) is the one and only Michael
Jordan. He is 6 from 6 in finals and crushed many dreams
of Hall of Fame players by stopping them from ever winning
the championship. My other sport is Rugby League and
I follow the Parramatta Eels. That stems back in my family all
the way to when they started in the comp in 1947. The 80’s
were legendary but I was only a little boy and don’t remember
how good they were. My mum tells me about it all the time!
I can’t believe they lost in 2001, that was their year to win
it and 2009 was a miracle run with Haynesy who I believe
is the best player to ever pull on the boots that could have
won Parra a premiership had he stuck around. Now he is
following his dream in the NFL and I will follow him all the
way! Everyone who knows me knows just how much I love
Jarryd – he is my favourite league player of all time.
What would you say has been your biggest success
in your career?
That’s a tough question. I think overall success is measured
by how well your team performs and what they represent.
I can honestly say that my guys are all better individuals and
a better team today than they were in the past and that to me
is what success is all about. It’s not about me – it’s about them
and us and progression. The coach (me) is the orchestrator;
the players play the game and they execute the game plan.
It is a collective effort and nothing makes me more proud and
honoured then to stand beside them. Without your people we
(Managers/Coaches) are non-existent.
If it is personal success it would have to be winning back
to back NSW Credit Manager of the Year in 20013 & 2014
sponsored by the AICM. Personal accolades are hard to come
by in Credit – nobody generally likes what we do (except for
the CFO of our own business when we pull great numbers).
It was a great honour to be awarded 2 years in a row. I am
sure there won’t be a third.
Anna Golubeva
Credit Manager, Hilti (Aust.)
Pty Ltd, MICM & NSW
Council Member
How did you get involved
in the Credit Industry and
in what capacity have you
been a credit professional?
I will be celebrating my 7
years anniversary this year:
1st of December 2008 is
the date when I started as
an Assistant in the Credit
Department of Hilti Russia.
I was developed within
the company into the
Team Leader position, and in 2013 moved from Moscow
to Sydney looking for international career opportunities.
Currently being a Credit Manager in Hilti (Aust.) Pty Ltd, I am
in charge of 7 credit professionals, one of the best teams I
worked with.
How long have you been involved with the AICM,
on Council and other?
I have been an AICM member for the last 2 years; on council –
since July 2015.
Why did you get involved on Council?
I am passionate about the Credit industry. I have been
within the industry for so long that sometimes I feel I know
it inside out. What is more amazing, I am continuously
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 39
AR
OU
ND
TH
E S
TA
TE
SNew South Wales
The Australian Institute of Credit Management welcomes our Partners for 2015.
ProfessionalPartner
OfficialDivisionSupportingSponsors
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.
NationalPartners
DivisionalPartners
learning: developing my team, introducing new technologies,
working on credit projects – it keeps me being enthusiastic
and encourages me to share my knowledge, energy and
experience with the people around me. I believe being an
AICM council I have more opportunities to do that through
networking. Only together we can build a better future for the
Credit industry in Australia.
What part of the world do you come from?
The country with the cold winters where the bears hang
around the streets and everyone’s favourite drink is vodka.
Do not always believe to what you hear though. I was born
in Moscow, Russia.
What is your favourite movie quote?
“You mustn’t be afraid to dream a little bigger, darling”,
Inception (2010).
What would you say has been your biggest success
in your career?
Being acknowledged as the National Winner for the Young
Credit Professional of the Year Award 2014 is definitely one of
the biggest achievements in my career. I could not expect the
better recognition than this one after being in Australia for just
one year. I would like to take an opportunity and once again
thank my team for the fantastic support.
Kimberley Hale
Currently I am the Debt
Solutions Manager for
Baycorp. I have been in debt
recovery for the past 8 years,
and have worked for Credit
Corp, Collection House, D&B
and NCML.
I became involved with
the AICM council through
my nomination in the New
South Wales YCP award
for 2015. Through this
experience and the events
I’ve attended I have met
many amazing people with similar interest and drive within
the Credit industry. They have openly encouraged me as a
new-comer and have unveiled new paths on how to improve
my career while building great new friendships. For me it’s
been a fabulous experience which I look forward to showing
others.
In my free time I enjoy many different sporting activities
which helps level my mind after a busy working week.
I currently support the Australian Diamonds in the Netball,
and the Parramatta Eels in the football. I’m fiercely
competitive and always love some friendly competition
within all aspects of my life. This keeps me motivated!
My biggest success in business came this year when
I was nominated for the YCP Award and won the NSW title.
Interestingly enough, what I have taken most out of the
experience with the AICM is introduction to its people and
understanding the love they have for our industry.
29 January
Dealing With Customers – 1 Day ProgramThis one day course covers two core areas of the Customer Relationship and two units of the Certificate IV in Credit Management, the Customer contact and Complaints process.
VENUE: GRACE HOTEL, 77 YORK STREET, SYDNEY
18-19 February
Factoring and Invoice Discounting – 2 Day ProgramThere has been substantial growth in the use of factoring and/or invoice discounting arrangements. This course is relevant to those people who provide a factoring and/or invoice discounting arrangement as well as those people who utilise such an arrangement.
VENUE: LEVEL 3/SUITE 303, 1-9 CHANDOS STREET, ST LEONARDS
Events Calendar
40 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
AR
OU
ND
TH
E S
TA
TE
SQueensland
President’s ReportOur team of Qld councillors has achieved fantastic engagement
and drive in the last quarter, not least of all highlighted by
the “Women in Credit (WINC) luncheon, which I will talk a
little bit about. 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.
Firstly, thank you to our Partners, Veda, Dun & Bradstreet,
Austral Mercantile, Vincent’s, Results Legal and Randstad for
the fantastic support this year. As always we could not have
held our events without their assistance. Please ensure that you
show your support to our Partners wherever possible.
The September WINC Luncheon – well what superlatives
cannot be said? Whilst I was not able to attend (due to my
flying out the next day on family holidays) the pictures and
figures speak for themselves. Julie McNamara (Patane Lawyers)
and her committee are proving again what absolute stars
they are. Planning for next year’s WINC luncheon is underway
already, so if you want to attend, or be involved in any way,
please contact Julie.
Michael McDowell MICM and Zara Mends at the Annual Conference.
Melinda Grob MICM and Ruthven Underhill CCE at the Annual Conference.
Dale Hannan MICM, Scott Goodrick MICM and John Gregg MICM.
Greg Young CCE at the Annual Conference.
Greg Young CCE, Christine Bracey, John Shanahan and Natalie Denschel at the Annual Conference.
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 41
AR
OU
ND
TH
E S
TA
TE
SQueensland
In October we saw our most excellent state winner Michael
McDowell (NCI Qld) vie with other state winner’s for the coveted
AICM YCP of the Year award at the AICM National Conference
in Sydney. Michael did his company and Qld proud with his very
professional presentation and preparation. His courtesy and
interaction with all members before and after the judging is a
shining example of the bright future which he and other YCP’s
bring to AICM.
Special thanks must also go to our YCP Councillor Maria
Schandl for her coaching and assisting Michael before and
during the judging process. Unfortunately, 2015 was not to
be Michael’s year, however he has assured us that he will be
lining up again when possible for another crack. Well done
Michael.
Our end of year function this year was held at Custom
House on Wednesday, 25 November. Members were
entertained by a panel topic of “Who did you say makes the
better Credit Manager?”, as well as prizes and raffles.
On a serious note, council will shortly be nutting out some
key dates for 2016, hoping to add some (fun-ner) events
which businesses might wish to sponsor. If members have
Queensland WINC Guests. WINC Guests.
specific events which they would like to assist with or see held,
they should not hesitate to contact Julie McNamara (Patane
Lawyers).
The co-operation and discussions with other states’
councillors continues. Not least of these are Col Magee and his
team in NSW. The collegiate atmosphere of the AICM National
Conference continues to foster discussion beneficial to all
members in all States.
Thank you all again for your support to the Queensland
council. We wish all our members and the other states, our
State and National Partners, and all of our supporters a Merry
and safe festive season.
– Peter Mills MICM
President
Qld WINC LuncheonWhat an amazing event our first WINC was for Brisbane on
18 September this year. A huge thankyou to our sponsors NCI
and Results Legal. Also our prize donators and supporters in
the audience! It would not have been as successful without
WINC Guests.Qld WINC Panel: Gemma Twemlow, Julie George, John McNamara and Sonia McDonald.
42 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
AR
OU
ND
TH
E S
TA
TE
S
on council, having been previously involved Carla is a great
addition to the team.
MARIA SCHANDL MICM
– Qld Councillor, YCP/YNN
Maria is another new member
to council, bringing her
experience as a previous YCP
Winner and being involved in
the credit industry for over 15
years. Maria is currently the
National Credit Manager of
Stoddart Group and holds a
Diploma in Financial Services
that was attained through
the AICM. Maria’s passions
include keeping fit and she
has been involved in completing obstacle races this year.
MICHAEL MCDOWELL MICM
- Qld YCP
“Recently I went through the
Australian Institute of Credit
Management, Young Credit
Professional Program. The
program started off with a
presentation in front of a panel
in Queensland and ended with
another presentation down in
Sydney. I managed to win the
Queensland Award and whilst
didn’t win nationally, I was
announced as a finalist down
in Sydney at the Annual Conference.
your contribution and attendance. Our venue was the beautiful
Customs House on the Brisbane River which was the perfect
venue for such a prestigious event and sure to be a first choice
in years to come.
We had an audience of more than 100 people of all walks
of life, both men and women most of whom were somehow
connected to the wonderful world of women in credit. The
day would not have been such a success without our amazing
speakers Julie George, Sonia McDonald, Gemma Twemlow
and John McNamara giving us their time and sharing their
experiences and of course our amazing facilitator Treacy
Sheehan MICM who flew up to Brisbane from Sydney to lead
the questions to the panel.
Also our wonderful WINC Committee Treacy Sheehan
MICM, Anna Taylor MICM, Zara Mends, Amanda Borland, Maria
Schandl MICM and yours truly for the planning and organising
of our amazing luncheon. A thank you should also go out to
our employers for their support during the process.
Together we raised over $4,000 toward our chosen
charities of the day, Suited for Success – Dress for Success
and Women’s Legal Service. What a fantastic effort and
outcome of a most enjoyable afternoon of good food, wine and
networking.
We can’t wait to do it again in September 2016! Date to be
advised soon, watch this space!
– Julie McNamara MICM
Introducing our Councillors
CARLA SEIRLIS CCE
– Qld Councillor
Carla has over 30 years’
experience within the credit
function across a wide variety
of industries and currently
holds the role of Credit
supervisor for Berwicks (Gold
Coast) Pty Ltd t/as BBC Digital.
Her passions away from credit
include her family, camping,
fishing and hunting. Carla is
one of our newest members
Qld WINC Leith Mitchell and Katrina Christ.
Qld WINC Guests at WINC Customs House.
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 43
AR
OU
ND
TH
E S
TA
TE
SQueensland
Qld WINC Julie and Gemma WINC.
“The whole program had a number of challenges
including creating a presentation in front of a panel of
experts on the ‘credit industry’.
“I would recommend this program for any young
credit professional looking to grow both personally and
professionally. I am more than happy to discuss the process
further with anyone that is interested.”
– Michael McDowell MICM
5 February
Welcome to 2016, AICM & YCP Bowling & Social NightVENUE: STRIKE BOWLING WINTERGARDEN
10 Feburary
Economic Forecast 2016 – What is in store
VENUE: CUSTOMS HOUSE
9 March
Developments in Trade – Credit LawVENUE: TBA
11-14 March
Online CCE Exam
13 April
Engaging & Retaining Credit ProfessionalsDo you know the what, when, why and howVENUE: RANDSTAD
20 April
Tool Box 1 – Half Day, Assessing Credit Apps
VENUE: RANDSTAD
11 May
Compliance & SecurityVENUE: TBA
13 May
Tool Box 2 – Half day, Collect with confidence
VENUE: RANDSTAD
8 June
Q&A – Time ManagementEmails/Collection Activity, Staff Management
VENUE: TBA
13 July
PD Breakfast – InsolvencyVENUE: VINCENTS
27 July
AICM Annual General MeetingVENUE: TBA
27 July
YCP Awards DinnerVENUE: TBA
August
Magistrates Court Visit & ProcedureVENUE: TBA
8 August
Tool Box 3 – Half DayVENUE: TBA
9 September
Women in Credit LunchVENUE: TBA
Events Calendar
The Australian Institute of Credit Management welcomes our Partners for
2015.
DivisionalPartners
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.
NationalPartners
44 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
South Australia
Vice-President’s Report2015 has been a busy and challenging year for the SA
Council, with added responsibilities for each portfolio
throughout the year.
I am pleased to say that the Councillors rose to the
challenge, ably led by our state President Gail Crowder,
who also put in a lot of hard work herself and led by
example! At the time of writing Gail is enjoying a well-
deserved holiday.
The year started off with an excellent and well attended
Credit Symposium at Hahndorf in the lovely Adelaide
Hills. The subsequent monthly credit focus sessions held
a number of interesting topics, including a liquidation
case study, trading trusts, credit risk assessments and
a mock trial at the Adelaide Magistrates’ Court. Our last
professional development event of the year, held on
20 November 2015, finished in style at the state-of-the-
art conference room at the Bendigo & Adelaide Bank,
where a half day seminar was held on credit management
fundamentals.
The social network nights were also very enjoyable and
gave great networking opportunities. They included our annual
awards night, a quiz night and credit professional networking
drinks.
The awards night in August was a highlight of the year
with approximately 100 people in attendance to see our
biggest ever contingent of State YCP applicants and finalists.
The biggest highlight was seeing our own State YCP Winner,
Tate O’Connor from NCML, win the national YCP award at
the National Conference in Sydney. We are also pleased to
welcome Tate onto the State Council.
On behalf of Gail and I, we thank all state councillors
for the efforts they made this year on Council. 2016 is
an exciting year ahead for us, as we look to revamp and
freshen up the events and training sessions we offer our
members (and all of those involved in credit management)
in South Australia.
We wish all members an enjoyable and safe festive season.
– James Devonish MICM CCE
Vice President
SA Division
James Devonish MICM CCE and Trevor Goodwin CCE – Credit Management Fundamentals.
Nick Pontikinas, Rebecca Edmiston MICM and Paul Westo MICM – Credit Management Fundamentals.
Credit Management Fundamentals.
Neil Fennell MICM – Credit Management Fundamentals.
AR
OU
ND
TH
E S
TA
TE
S
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 45
AR
OU
ND
TH
E S
TA
TE
SSouth Australia
Professional Development Half-Day Seminar – 20 November 2015The SA Division held its second professional development
seminar for 2015 in an exciting, state-of-the-art conference
room at the new Bendigo & Adelaide Bank building in the
Adelaide CBD.
The seminar was a half-day seminar and was on credit
management fundamentals. The topics were Tools for Credit
Risk Analysis, presented by Trevor Goodwin of NCI Credit
Insurance (Brokers) Pty Ltd, Reading and Understanding
Company Financials by Neil Fennell of Worrells Solvency
and Forensic Accountants, Credit Hypotheticals by James
Devonish of Lynch Meyer Lawyers and Career Development
in Credit by Nick Pontikinas of Boart Longyear, Rebecca
Edmiston of Bendigo & Adelaide Bank and Paul Westo from
Toro Australia Pty Ltd.
Trevor demonstrated his wealth of knowledge in credit
risk analysis with a comprehensive and detailed presentation.
He emphasised the importance of the five “w”s and five “c”s
of credit, the various public and private sources to access
information and intelligence about debtors, as well as a useful
discussion about the early warning signs of a customer in
trouble.
Neil Fennell shed light on what can often be a complicated
process of analysing financial statements, setting out
various vertical and horizontal ratios to measure the financial
performance of a company and also what to consider outside
of the financial statements when considering a company’s
creditworthiness generally.
James Devonish presented three hypothetical credit
scenarios (helpfully prepared by Eric Milne of Fujitsu General
Australia) which involved a lot of audience participation and
also takeaway lessons and discussion points.
Lastly, Nick Pontikinas, Rebecca Edmiston and Paul
Toro all provided tips for excelling in a credit role and in
developing a career in credit. Some of the tips included:
knowing your business and customers very well, ensuring
all communications with management was meaningful and
proactive; and looking for those opportunities as a credit
manager to provide good news stories and to not be afraid to
own and promote your successes with management (because
no-one else will do it for you!).
All in all it was an entertaining and informative half-day
seminar and we thank all the guest speakers for their time and
contribution. We also thank Bendigo and Adelaide Bank for
allowing us to use their conference room and facilities.
– PD Committee, SA Council
James Neate MICM at the Conference.
Josh Richards.
James Neate MICM, SA Director, Tate O’Connor MICM 2015 YCPA, Gail Crowder MICM (SA President), Rebecca Edmiston (2014 YCPA).
James Devonish MICM CCE.
46 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
AR
OU
ND
TH
E S
TA
TE
SSouth Australia
The Australian Institute of Credit Management welcomes our Partners for 2015.
DivisionalPartners
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.
NationalPartners
October Credit Focus: Stand Out – how to get the attention you deservePresented by Jane Calleja, Learning & Development Manager
from National Credit Insurance (Brokers) Pty Ltd who covered
all the challenges we face in our day-to-day roles in Credit.
Even though we were only small in numbers, we certainly
made up for it with involvement and role-playing throughout
Jane’s presentation.
Topics discussed were challenge our perceptions of
ourselves and others, explore behaviours to help stand out
and be noticed and sharing tips on creating and sustaining
change in our life. Many more ideas and thoughts were
touched on throughout the morning session.
Jane certainly gave us lots of valuable ideas like don’t make
assumptions, dress the part, feel the part, be sociable, help
others to succeed, accept responsibility, get involved, stay
away from office politics, be change ready, continue to learn
and build a reputation for reliability and challenge.
Quote of the day was – “Get Curious Not Furious”
There were some great ideas discussed and everyone
seemed to go away with thoughts on what changes we need
to make it happen.
Here is just one example of the feedback we received.
“I certainly came out with a different way of thinking, it
was very informative and I will definitely be putting these
ideas into action.”
– Anne Wilkins FICM CCE, Credit Focus Portfolio
Jane Calleja and Anne Wilkins.
Gail Crowder and Sean Brady at the President’s Dinner.
SA Credit Focus.
Anna Golubeva and Rebecca Edmiston.
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 47
AR
OU
ND
TH
E S
TA
TE
SMaureen Grant CCE – NCM, Lindt and Sprungli, Beth Gray CCE – NCM, Red Bull Australia and Rosina Edgar MICM – NCM, Mercedes Benz.
Winners: Team Transurban.
Victoria/Tasmania
Charles Tims CCE – National Credit Manager, Tuftmaster, Kate Baker MICM and Bianca Ronbinson, Urbis Pty Ltd.
Runners Up: Team Reece, Credit Team of the Year 2014.
YCP Function – Trivia NightHeld at the Melbourne Central Lion Hotel on 17 September,
what a fabulous turnout! 68 members and guests attended
the YCP Trivia Night organized by Neil Smith from Transurban
and the Functions Chair on the Vic/Tas Committee. There
were 8 teams of very enthusiastic quiz aficionados with 3
teams from Reece Plumbing; a great attendance from the
team at Reece. The evening commenced with a bit of social
chit chat over a drink but all gloves were off when the quiz
was underway. Consisting mainly of music trivia a fun night
was had by all. The team from Transurban lead by Arthur
Tchetchenian, took out the title for this event, the team
included Rob, Seema, Meg, Rob, Steve and Marina, with a
team from Reece coming in a close second. When the points
were tallied at the end only 1 point separated 1st and 2nd.
Quite a few participants kicked on after the conclusion of
the Trivia Night, which mainly consisted of members from
Transurban who felt obliged to celebrate their win. A very
popular and enjoyable night, we’ll definitely be running this
event in 2016. Much thanks to Neil for organising the event.
Court Process and Court Proceedings A tour of the Old Melbourne Gaol was only part of the
excellent learning experience at this half day seminar
on October 29. An informative but fun look at the Court
Process, being cross examined and giving evidence in a trial
environment. Tracy Rothwell from Rothwell Lawyers played
Judge Judy and joined by Barristers Lionel Wirth and Andrea
Mapp and QC Peter Cawthorne, gave an overview of the
See You in Court – Touring the Old Melbourne Gaol.
48 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
AR
OU
ND
TH
E S
TA
TE
SVictoria/Tasmania
process and allowed participants to get firsthand experience
of what it is like to be cross examined in the witness box.
There were dress ups and mug shots as Frank Fisher from
Australia Post donned the Magistrates garb; all part of the
fun and frivolity, however the participants’ attention was
soon turned to the court room experience and for all who
attended it was invaluable. Members, if you get a chance
to attend this half day seminar next time around we highly
recommend it, because you never know when your contact
with a customer will require you to give evidence in court.
Being familiar and comfortable with the process can help
you to be calm during a hearing and therefore help you
appear more credible as a witness when the time comes.
A big thank you to Tracy, Peter, Lionel and Andrea for their
time, preparation and participation. We greatly appreciate
you delivering this wonderful seminar for the benefit of our
members.
Women in Credit Business Luncheon – 20th November109 credit professionals and their guests attended the Vic/Tas
Division’s inaugural Women in Credit (“WINC”) Business
Luncheon, held at the Waterfront Room at Waterfront Venues,
Docklands.
Mostly women in attendance, however there were quite a
few men, and we thank you for your interest and involvement
in the day. The venue was lovely, the décor was lovely, the food
delicious and the service excellent.
The day’s proceedings commenced with a superb
introduction by our MC’s and major sponsors for the day;
Zara Mends from NCI and Anna Taylor from Results Legal,
who are both ardent in their support of the WINC credo. They
understand the issues that women in professional roles face
and the contribution and standing of women within the credit
industry as a whole.
Amanda Rothwell – Prisoner 12346.
QC Peter Cawthorne instructs participants with Barristers Andrea Mapp and Lionel Wirth and Catrina Galanti MICM of Austral Mercantile in the Witness Box.
Members and Guests at the Old Melbourne Court House.
Frank Fisher of Australia Post donns the Magistrates Garb.
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 49
AR
OU
ND
TH
E S
TA
TE
SVictoria/Tasmania
Both Zara and Anna spoke passionately about their own
experiences and their patronage of the WINC functions.
All funds raised from the event went to Dress for Success
Mornington Peninsula (“DFSMP”), a charity that assists
unemployed, low-income women on and around the
Mornington Peninsula who are seeking to return to work and
who need to rebuild their self confidence and self-esteem
after experiencing long-term unemployment, health, social,
educational or other difficulties. Over the last 6 years DFSMP
have provided a free dressing and support service to over
3,000 women helping to build their job-readiness and interview
skills and enabling them to dress appropriately in stylish
professional outfits that they are able to keep.
Prue Leggoe from DFSMP played a compelling video of
several women whose lives have been completely turned
around due to the assistance they were provided by DFS, and
spoke fervently of the great importance of the work that they
do and thanked all attendees for their attendance and support.
Traceay Sheehan MICM from Trace Personnel then chaired
an ‘On the Couch” discussion with Linda Murray Executive
Coach from Athea Coaching, Carole McTavish, Shared Service
Manager from IXOM and Jan Reeves Collections Expert and
Entrepreneur.
The ladies shared their vast and varied experience in
business, collections and life in general. They also provided
insights into the power of goal setting and planning, or in
Carole’s case just focusing on the things that you want, which is
actually keeping the goal in sight.
All three agreed on many points like keeping focused on the
positive things in your life and career and the things that you
want, rather than focusing on negatives.
Linda Murray made an interesting point about gender bias
and the fact that we, as women, need to be mindful of our
own bias. Linda went on to say that it is our responsibility
to be mindful and careful that we don’t inadvertently
perpetuate and promote the exact biases that we are trying
Carole McTavish of IXOM.Anna Taylor of Results Legal and Zara Mends of NCI – MCs for the Afternoon.
Members and guests with Prue Leggoe of Dress for Success.
Members and guests listen intently.
50 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
AR
OU
ND
TH
E S
TA
TE
SVictoria/Tasmania
to stamp out by engaging in behaviour that supports those
biases.
The major concepts that came out of the afternoon were
that women can do anything that we put our minds to, that
we are responsible for our own success and having the
courage to ask for what we want, and it is our responsibility
to voice any disparities we observe and to promote
ourselves.
We have received excellent feedback from members and
guests and this will be another event that will feature on our
annual program.
A special thanks to our major sponsors for the event;
Results Legal and NCI, and for the other companies who
supported with raffle prizes and items for the Goodie Bags;
National Collection Services, Australia Receivables Limited,
Room to Improve, Austral Mercantile, Cor Cordis, Baxters Food,
NCML, Trace Personnel, Fitness First, Blue Mane Consulting,
CGU Insurance, Recoveries National, Credit Solutions,
Home Direct, Bek’s Blooms, Reliance Recoveries, Blue Mane
Consulting, Jan Reeves, Veda, Austral Mercantile, NCML, White
Cleland Lawyers & Consultants, Baxters Foods, Collins & Co
Accountants, Sharp & Carter Recruitment, Sclazo Foods, ARL
Receivables, Stephanie Kate Hair Design, All Office Business
Solutions, REA Group, Bronwyn Bennet (Creating Healthy
Spaces), without who’s support we could never hold events
such as these. Our gratitude cannot be measured in words, but
thank you for your outstanding contribution to this event.
Lastly I want to thank the committee for their efforts in
putting this event together; Alison Said (National Manager-
Credit, GCU Insurance), Donna Smith (Managing Director,
Reliance Recoveries), Treacy Sheehan (Managing Director,
Trace Personnel), Robyn Erskine (Brooke Bird), Sherif Hussein
(Credit Manager, REA Group), Lou Caldararo (National Credit
Manager, Spicers), and Jeff Hurst (Credit Manager, Scalzo Food
Industries), Nick Pilavidis (CEO AICM) and Amanda Borland
(AICM).
A great deal of work goes into organizing these events, so
thank you all for your tireless work and contribution.
Inspirational Quote:“Be the Change You Want to See in the World” – Mahatma
Gandhi
UPCOMING EVENTSSave the dates and mark your calendars
15th December – CCE Breakfast
Our Esteemed Panel: Linda Murray – Athena Coaching, Carole McTavish – IXOM, Jan Reeves MICM – Get Paid for the Work you Do.
Treacy Sheehan MICM of Trace Personnel – Chair of the Esteemed Panel.
The Australian Institute of Credit Management welcomes our Partners for 2015.
DivisionalPartners
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.
NationalPartners
ProfessionalPartners
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 51
AR
OU
ND
TH
E S
TA
TE
S
High Tea: Val Baynes MICM, Natalie Lunt and Donna Trezise.
High Tea: Simone Haskins, Lisa Marr MICM and Yvonne Liew.
High Tea.
Western Australia/NT
High TeaI was fortunate enough to attend the WA AICM Social Soiree
High Tea at Pagoda Resort in September. With a new president,
Lisa Marr, stepping up to the plate I was looking forward to
hearing what was in store for the WA AICM and what we can
look forward to in the next year.
There was a great cross section of the credit community
in attendance with representation from sponsors, credit
professionals and current members of the institute.
President’s ReportJust seemed like the other day I was walking down the street
without a care in the world.
But I find it’s December, it’s the end of the year, and I have
survived 6 months of the adventure as WA President.
Still asking many questions of the team at head office as
well as my mentors here in WA.
I have to remind myself that opportunities of this nature
do not come along all that often….
Over the course of 2015, we have been able to gift our WA
members with some very informative and relevant workshops.
Perhaps socially quieter this year, our Sponsors Lunch and
the High Tea were welcomed with much anticipation.
Our traditional Christmas on the Bay will bring things to
a close and allow us to spend time with our credit family
members.
Looking forward to 2016, we hope to educate, innovate and
invigorate our WA Members to putting their best credit foot
forward.
Take care over the festive season, relax and enjoy time with
family and friends. We can’t wait to see you all next year.
52 CREDIT MANAGEMENT IN AUSTRALIA • December 2015
AR
OU
ND
TH
E S
TA
TE
SWestern Australia/Northern Territory
Conversation was lively and the occasion provided a solid
networking opportunity for many in attendance. It was
very encouraging hearing from other Women in the credit
profession, sharing their experiences and current challenges
in the industry and the current market. The location was
fantastic and the catering was impressive. I do hope that
the high tea is a permanent fixture on the WA AICM social
calendar for years to come.
– Natalie Lunt MICMNational Credit Manager, Coventry Group Ltd
David Brennan2015 YCPA
I was fortunate enough to represent Western Australia at the
2015 Young Credit Professional of the year awards during the
AICM National Conference held in Sydney during October.
Prior to this process I had no knowledge of the AICM, being
from the financial technology sector we have previously not
engaged with traditional groups or associations focused on
credit and credit management. That will certainly change after
being involved for just a short period of time.
The people I have met have inspired me to not only go forth
in my quest for lending automation but also tweak some of our
technology to incorporate trade credit underwriting where we
had previously only focused on unsecured lending (watch this
space).
The process and Conference
The process was tough but thoroughly enjoyable, it made me
think long and hard about me, my views on the industry and
also look back at our successes and failures over the past few
years.
I was truly honored to have been chosen as the winner of
the Western Australian division and was greatly looking forward
to competing on the national stage.
The national conference was incredibly well organised, the
professionalism of the organisers, speakers and exhibitors
showed that the AICM will continue to be the preeminent credit
association in years to come.
The hospitality shown to myself and the other state finalists
was world class and truly memorable.
Unfortunately I wasn’t able to come home with the silver
wear but learnt more about myself and our business during
the process than I have before. A fantastic way to look back,
something that is sometimes difficult in our ever-evolving
business lives.
Any young credit professionals that are thinking about
involving themselves in the AICM or the YCP should jump right
in, it’s an amazing experience and one that you will remember
forever.
The Australian Institute of Credit Management welcomes our Partners for 2015.
DivisionalPartners
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.
NationalPartners
December 2015 • CREDIT MANAGEMENT IN AUSTRALIA 53
AR
OU
ND
TH
E S
TA
TE
SNew Members
QUEENSLANDJordan Bennie Mcinnes Wilson Lawyers
Linda Cougle Cashflow Finance Australia Pty Ltd
Alison Lawrence Cashflow Finance Australia Pty Ltd
Kristy Lazarus Cashflow Finance Australia Pty Ltd
Benjamin McPhail Cashflow Finance Australia Pty Ltd
Nick Stark Summer Collection Group
Shannon Stelfox Earlypay
Selina Stephen Cashflow Finance Australia Pty Ltd
Peter Toohey Cashflow Finance Australia Pty Ltd
Peta Vaoiva Cashflow Finance Australia Pty Ltd
NEW SOUTH WALESIan Armstrong Ruralco Holdings Limited
Scott Boyd Veda
Stephanie Cornforth Smith Leonard Fahey Lawyers
Dane Fazakerley Veda
Kylie Gomersall Harvey Norman Commercial Division
Mittu Gopalan Freedman & Gopalan Solicitors
Steven Highfield CML Group
Michael Leonard Smith Leonard Fahey Lawyers
Felisima Manalo Sanofi-Aventis Pty Ltd
Paul Mead Veda
Lewis Meegan Veda
Maria Messina Instant Access
Natalie Monaghan Harvey Norman Commercial Division
Heather Pattullo Veda
Ian Renney Brickworks Building Products Pty Ltd
Miral Sarvaiya Austral Mercantile Collections Pty Ltd
Mohammed Sherkawi Cabcharge Australia Limited
Heather Spring Sanofi
Garry Trompp Onesteel Trading Pty Ltd
Gina Villoria Imperial Tobacco Australia Ltd
Ni Vo Hilti (Aust) Pty Ltd
Paul Walker Dux Manufacturing Limited
VICTORIA/TASMANIARikki-Lee Ellis Reece Pty Ltd
Bianca Haver Reece Goup
Liam Jenkins Adidas Australia Pty Ltd
Robert Lyons Reece Pty Ltd
Lynne Moynihan Ridley Agriproducts Pty Ltd
Candice Noom Reece Pty Ltd
Michael Nugent The ICM Partnership Pty Ltd
Benita Payten Reece Goup
Roxanne Robinson Reece Plumbing Pty Ltd
Jenny Saveski Onesteel Pty Ltd
Deborah Stark Reece Goup
Mahlee Terrell Foremans Business Services
SOUTH AUSTRALIAShivaan Christensen Credit Recovery Solutions
Kim Mansfield The Polygon Group Pty Ltd
Brittney Waddington Railroad Transport Pty Ltd
WESTERN AUSTRALIAJulie Bartlett COVS Parts Pty Ltd
Dermot Horkan Onesteel Trading Pty Ltd
Warren Myers CMP Recruitment Specialist
NEW MEMBERS
The Institute welcomes the following credit professionals who were recently admitted to membership in September and October
2015.