Financial Roadshow 2007
By: John Cotterell
• John Cotterell – Manager
• Amarjit Kaur – ARG Liason/TPC’s
• Chintha Ranwala – Student Accounts
• Paul Hamilton – Trade Debtors
• Lee Murphy – Trade Liason/Support
• Varun Khanna – Student Accounts
• TBC – DCA Accounts
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Areas of Responsibility
• Student Debtors (2)
• Trade Debtors (1)
• TPC & ARG Support (1)
• DCA Accounts (1)
• Investigations & Reports (1)
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• Contacts – Surname (A-L) – 51771
Surname (M-Z) – 52231
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• Contacts – Collections/Disputes – 51734
Credit Checks/Reports – 52778
Email – Tradeaccounts@rmit.edu.au
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• Contacts – All Enquiries – 53649
Email – Creditmanagement@rmit.edu.au
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• Contacts – All Enquiries – 52231
Email – DCAaccount@rmit.edu.au
External Agents – Dun & Bradstreet
Citibureau ( NCML)
* DCA – Debt Collection Agencies
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Functions of Credit Department
• Assessment of Credit Risk – Good Credit processes will strive to accept all business, but they must continuously
assess and monitor in place to control high risk customers.
• Establishment of Credit Terms & Limits – Terms (Days) and Limits should take into account the risk. The Limits
can not simply be the value of the invoice, post sales.
Monitoring & Control of Debt – This includes ensuring;
* Agreed Terms & Credit Limits are being adhered to and appropriate – ( Annual Reviews to be put in place).
* All High Risk Debtors are kept under tight control.
* Major customers must also be watched carefully as they account for a high proportion of the ledger and therefore
• Collection of Payment – Collections to be made solely by the credit management department, in a manner that
creates optimum cashflow whilst ensuring continuity of good business.
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• To save time and possibly avoid frustrations , it always pays to check FD33 Display Credit
Management before starting to create an invoice.
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Credit Limit Confirmation
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Account Blocked ( See Tick)
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Check Notes (Double Click on Texts)
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How we can help?
This process of checking account status briefly prior to invoice raising will
hopefully prevent invoices being half raised before matters surrounding
credit limits come to light at your level. Then by bringing specific issues to
our attention will assist Credit Management in assessing the credit limit and
amending as appropriate as soon as possible.
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• Credit Limits across all segments are under review. In the policy currently
under review it is our intent to set high fixed value credit limits for our non
commercial customers. (I.E. Accounts starting 5*** & 6****).
• This will hopefully allow freer and smoother invoicing within confirmed
• A suggestion would be to give all 5** accounts a set credit limit of $50,000 (
unless sighted contracts advise otherwise), and all 6**** accounts a set
credit limit of $1,000,000 (unless sighted contracts advise otherwise).
• Of course Credit Management will still , through a detailed and confirmed
dunning process, monitor days overdue and act accordingly within revised
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Calculating a Credit Limit
Whilst checks still need to be made to confirm the correct credit limit for an
account, a simple calculation to assist the Credit Department is to request
twice the monthly invoice value.
This allows an invoice to be raised in the second month, whilst the one from the
previous month still sits within terms or has recently fallen outside terms.
Of course if this went on into the 3rd month, the dunning process may well have
blocked this account until payments or any issues have been resolved.
This more accurate guide will again make invoice raising quicker and smoother
whilst the limit is accurate and customer remains within agreed terms.
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• Moving forward departmental contacts are likely to be removed from
invoices, to assist in prompter payment receipts and logging of
• The logic is that once an invoice is sent out , the first department
that need to be aware of any payment/dispute is accounts
receivable and the invoice will be redesigned to reflect that.
• Once this has been approved in design, a copy will be sent out for
• Prompt payment receipt and processing , and timely logging of
disputes, will update accounts and block invoices so that the most
up to date and accurate presentation of an account is made.
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• Once a dispute has been logged and invoice blocked, the dispute
will immediately be passed out to school/portfolio for investigation.
• Any payment disputes will initially be investigated by the Credit
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• As mentioned with disputes, the design of the invoice is under
review to advise of more accurate and timely payments.
• This will hopefully be achieved , by making the invoice clear in
remittance details ( customer no.) , and also payment methods and
• The sending of cheques to other areas of the university needs to be
discouraged, and the use of cash books is to be significantly
decreased over the coming months. The removal of this and
directing to automated areas, will allow credit card details to be
processed and checked immediately.
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• Whilst there may be frustration in payment delays, please do not
contact customers directly over outstanding accounts. It may appear
helpful, yet debt collection is now a legal minefield and by acting
outside legislation and guidelines you may put yourself under severe
risk of financial penalty.
• All staff are currently undergoing formal training re the ASIC Debtor
Guidelines and National Privacy Act, and along with our established
external agents, all proper steps will be made to recover outstanding
• Feel free to contact me directly, if you have any concerns re the
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