NACM Oregon Business Credit Journal · Certified Credit & Risk Analyst (CCRA) This designation was...

March/April 2013

NACM Oregon

Business Credit Journal

7931 NE Halsey, Suite 200 Portland, Oregon 97213 Tel 503.257.0802 Fax 503.257.0247 www.nacmoregon.org

In This Issue

Garnishing An Out-of-State Bank Account ....................... 1

NACM Certification Program .... 2

Certification Success .............. 3

Chair’s Message ..................... 2

President’s Message ............... 2

International Corner ............... 7

NACM-Oregon Foundation ...... 8

Reporting Credit Experience .... 9

DSO Results .......................... 11

Webinars On the Move ........... 13

Education .............................. 14

Contacts ................................ 16

...continue on page 15

Garnishing An Out-of-State Bank Account? Yes, It May Be PossibleBradley D. Blakeley, Esq., Blakeley & Blakeley, LLP


Four Key Things to Consider Before Outsourcing Credit, Collections Functions

An increasing number of companies have looked abroad, especially to Southeast Asia and Eastern Europe, as a way to cut costs. This is trend that has not missed the credit industry. And, while it would be dishonest to say cheap

labor and lax regulations have helped some save money, there’s often much more than meets the eye when it comes to outsourcing credit and collections functions. While some continue to do it to varying degrees, there are

also a bevy of stories of companies who’ve brought those operations back home entirely for a variety of reasons (notably including the following).

Judgment creditors often face the issue of whether they can levy on the bank account of an out-of-state judgment debtor. In a common scenario, a judgment creditor, often through its a forum-selection clause in its credit application or contract, obtains a judgment in their home state against an out-of-state judg-ment debtor. Using the judgment debtor’s checks, credit application or perhaps a third-party service, the judgment creditor confirms that the judgment debtor uses a bank with branches in the judgment creditor’s home state. Now the ques-tion for the judgment creditor is can it levy on the bank in its home state?

The answer can take two forms depending on whether the bank is state chartered or federally chartered. Many years ago, when most banks were state chartered, their funds were held at the branch level. As a result, a judgment creditor’s levy had to be branch specific. Specifically, Commercial Code § 4107 provides that “A branch or separate office of a bank is a separate bank for the purpose of computing the time within which and determining the place at or to which action may be taken or notice or orders shall be given under this division and under Division 3 (commencing with Section 3101).”

But in the mid to late 1980s, the banking industry went through major changes, with many banks consolidating or merging. In response, in 1994, Congress

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NACM Oregon



NACM Certification ProgramWhy Should You Earn Your Certification?

When you apply to participate in the Professional Certification Program, you are on your way to demonstrating that you are among the best. You’ll join a select group of individuals who have made the commitment to excellence in credit management, career advancement, and an ongoing pursuit of knowledge. Throughout the process, you will be recognized for your achievements.

The certification program, sponsored by the National Association of Credit Management, contains the three designation levels, CBA, CBF, and CCE, and is designed to build from one level to the next. This program has a great deal of flexibility and focuses on offering participants a well-rounded approach to their education. It has the advantage of being recognized by employers nationwide as a symbol of outstanding achievement.

A Recognized Path to Success

Among credit management professionals, the professional certification program is respected and appreciated. Not only is participation in the program a mark of distinction throughout the profession, but it offers you a wide range of important benefits:

• Expanded Knowledge: By reading, studying, and preparing for the exams, you’ll gain a thorough, up-to-date understanding of every aspect of credit management, including a look at future trends and strategies essential to your success.

• Career Opportunities: Certification tells employers that you are motivated,

accomplished, and current in your knowledge of credit management skills. It indicates that you are actively working to maintain high standards in the field.

• Heightened Professional Recognition: NACM’s professional designations attest to experience, knowledge, ability, accomplishment, leadership, and contributions to the credit and financial fields. Designations raise the level of respect among colleagues in business credit management and between professionals in the financial community. Proudly display your designation with your name on letterhead, business cards, and all forms of address.

• Standards of Excellence: With constant changes in credit and with banking and financial services redefining the role of the credit executive, the certification program is clearly a valuable way to master professional education requirements and achieve professional excellence.

To begin the process, the NACM’s Professional Certification Program brochure will take you through the program procedures step-by step.

Certification Exam Schedule

The dates for the CBA, CBF, and CCE exams are published below and in the NACM National Certification Brochure for more detailed information. The exam test date schedule may be modified from time to time; all exam candidates will receive updated information and schedules with their written eligibility confirmation if this occurs. The CBA, CBF, and CCE exams will be given at your local Affiliated Association office on the dates listed below.

Exam Date: May 19, 2013 Credit Congress, Las Vegas, NV

Deadline: March 25, 2013

Exam Date: July 29, 2013

Deadline: June 3, 2013

Exam Date: November 4, 2013

Deadline: September 9, 2013

Your Registration Form, Application Form, corresponding fees and documented Career Roadmap (if applicable) must arrive in our office by the day of the paperwork deadline to ensure a formal evaluation of your information for each exam. You will receive written confirmation of your file status approximately four weeks from the date we receive your paperwork.

http://www.nacm.org/images/pdfs/certprog_brch.pdf

http://www.nacm.org/images/pdfs/certprog_brch.pdf

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NACM Oregon



Key to Successby Martha Anderson, CCE

As the bookkeeper for a small business, when Martha Anderson

found herself a divorced mother at 30 she knew she was at a crossroad in her life. Down one road was status quo and living paycheck to paycheck with her son. The other road would require more sacrifice in the short term, but could lead to a better life. “I realized that I needed to make more money to support us,” says Anderson, “and I knew that getting an education would be the key to a better future. I realized that either I would look back in a few years and regret having watched so much TV, or I could work on a college degree by going to class one or

two nights a week.” It made sense, with her background, to start off with an accounting class. She found she enjoyed it. So she took another. When she was hired as an Accounts Receivable Supervisor at a larger company she found that the combination of legal, sales and accounting work provided a refreshing variety. While Anderson picked up a few credits a quarter working towards her Associate Degree she came across NACM, joined, and sat for her Credit Business Fellow (CBF) exam. Raising her son and taking classes

at Mt. Hood Community College made for a tight budget, but Anderson found that many employers offer educational assistance—even for classes offered by NACM. This is especially true if the classes are related to one’s current position. She discovered that NACM offers scholarships as well. As Anderson puts it, “Most employers know that when an employee is pursuing an education they have a highly motivated employee. The really great thing about an educa-tion is that even if you change jobs, your education goes with you.” Anderson moved her growing acumen and education into a position as a Credit Analyst at a publicly-traded company, where she began working with higher receivables dollar balances. She also decided to sit for the Certified Credit Executive (CCE) exam. “I finally felt ready to apply for a Credit Manager position with a large company,” says Anderson. It was 1996 and Martha Anderson had just completed all the credits for her Bachelor’s Degree in Accounting. A week before she was to get her diploma she interviewed at Ash Grove Cement Company—a 131-year-old national cement manufacturing company. Knowing that there were four other candidates for the position made Anderson nervous. But she also knew her resume was the only one that stated:

“Certified Credit Executive (CCE): Achieved executive level accreditation from the National Association of Credit Management. This is the highest accreditation of the nationally recognized


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Key to Success, continued from page 3

organization.”

Not only did it boost her confidence, she feels it was the reason she got the job. Anderson was now Ash Grove’s credit manager for the entire west half of the US. Anderson talks about working her way through an accounting degree with pride, but it is the accreditations from NACM that she seems proudest of. It was the Credit Business Fellowship exam that Anderson felt was the most

Exciting New Designation Opportunity!The NACM Education Department is pleased to announce a new designation:

Certified Credit & Risk Analyst (CCRA)This designation was created to support the need to maintain sound financial analysis skills.

The three courses needed to qualify for this designation are:

• Basic Financial Accounting• Financial Statement Analysis I• Financial Statement Analysis, Interpretation & Credit Risk Assessment

Initially, the Financial Statement Analysis, Interpretation & Credit Risk Assessment course needed to complete this designation will only be available through NACM-National, at National’s headquarters and at Credit Congress. Once this roll out is completed, NACM will consider other methods of distribution.

A few other important notes on the CCRA:

• The NACM Career Roadmap is not required for this designation. • The final exam for the Financial Statement Analysis, Interpretation & Credit Risk Assessment course will serve as the

designation exam.• The CCRA will be a lifetime designation; recertification will not be required.

Questions? Contact Elizabeth Heintz at [email protected], or 971-230-1120 (800-622-6985 ext. 1120) today!

challenging. “It was a scary exam back then,” she says. “Today the CBF is a four-hour exam. When I sat for the CBF it was a twelve-hour exam: four hours a day for three days. It really pushed you. Once you passed the CBF you just thought ‘well the CCE can’t be that much worse.’” As she anticipated, studying and sitting for the Certified Credit Executive accreditation was difficult but didn’t feel as intimidating. “It was something that I felt was

challenging but worthwhile,” says Anderson. “The exam comprehensively covers all the different things you need to think about in credit.” This includes the legal, customer, sales, and financial aspects of credit management. On the job experience can teach professionals a lot of good lessons, but as Anderson explains, “It’s the testing that really determines whether you know the material. It helps you to know you can grasp it. It helps your employer know you can grasp it. The application comes after that.”

NACM’s CCE designation almost becomes a professional currency. “We share a bond. We share an interest in education, we share an interest in pursing and achieving goals. When I notice that someone has the CCE designation it actually tells me a lot about that person. I know that it is someone who had pushed themselves to levels that most people don’t go to.”

mailto:eheintz%40nacmoregon.org?subject=

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NACM Oregon



Message from the President Mark your calendar for Thursday, April 25, for the NACM Oregon Annual Meeting. We will have a morning seminar with David Osburn. David will lead a seminar on Negotiations: Asking for the Business and Closing the Deal. He regularly speaks at regional and national meetings and provides an entertaining and informative approach. Then, we’ll have the NACM Annual Meeting, with a brief review of 2012 and introduction of the Board of Directors. After lunch, Kerry Tymchuk, Executive Director of the Oregon Historical Society, will speak on the mission of OHS and its work, and provide some “hands on” exhibits. Watch for your invitation!

Have you used the 25 credit reports included in your membership? I encourage you to try this product. The NACM database has increased by more than 50% in the last year and now has more than 10 million current lines of information. Need some help? Contact your Account Executive or Customer Service at 971-230-1220 and one of the representatives will be glad to walk you through the process and the report.

Best wishes for an enjoyable and prosperous 2013!

Rod Wheeland, CCE, CAE Direct: 971.230.1158 [email protected]

Message from the Chairman It is early March, but there is still time to register for the 2013 NACM Credit Congress & Exposition at the Rio Hotel in Las Vegas. It is being held from May 19 to May 22. I am betting that it will be sunny and warm in Las Vegas and what a great way to get out from under the gray skies of the Pacific Northwest.

Mark you calendars for NACM Construction Days, April 3 and 4. The Oregon, Washington, and Idaho Lien Laws will be covered on April 3 from 8:30 a.m. to 4 p.m; The Federal Miller Act, Bond Claims, Washington Retainage Claims, and Bond Checks will be covered on Day 2 from 8:30 - 11:30 a.m.

Join us on April 25, for our Annual Meeting and Educational Session at the Embassy Suites Portland Airport. Watch for more details.

Do not forget that you have 25 free NACM Credit Reports available with your membership. I personally find this credit report to be very helpful as it shows the current credit references from your industry group members as well as the other NACM members around the country. In addition, our website has many other resources available to our members to assist you in your everyday credit management decisions.

John Hardy Emerson Hardwood Co. [email protected]

mailto:rwheeland%40nacmoregon.org?subject=

mailto:jhardy%40emersonhardwood.com?subject=

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NACM Oregon



Nellie Mae Virginia Gift was born on September 15, 1912, in Winlock, Washington, to Homer and Pearl (Langford) Hughes.

She died at a Scappoose Adult Foster care home on January 26, 2013, at the age of 100.

She attended business college in Portland, eventually working at The Oregonian newspaper. She retired as the credit manager in 1977 after 23 years.

She married Donald Gift on November 19, 1934, in Oregon. He preceded her in death in 1998.

They lived in the St. Johns area of Portland prior to moving to Scappoose in 1941 until present.

Nellie was a long-time member of NACM Oregon and served as President in 1968-69 of the Portland Credit Women’s Association. Her interests included gardening, china painting, flowers, and family.

Annual Meet ing Not ice The Annual Meeting of the NACM-Oregon Foundation will be held on Wednesday, April 10, 2013, at 4 p.m. in the NACM Oregon Classroom (Suite 201), 7931 NE Halsey St., Portland, OR 97213.

All Members and those interested in the operations of the NOF are encouraged to attend. Election of Board members is on the agenda.

The Regular Meeting of the Board will be held directly following the Annual Meeting.

Jeffrey L. O’Banion, CCE/ICCE Secretary/Treasurer

© New Yorker Cartoon. Leo Cullum from cartoonbank.com. All Rights Reserved.

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NACM Oregon



International Corner, by Alice Knight, RGCP

Alice Knight is Vice President of Finance & Administration for Paper Products Marketing, Inc. Ms. Knight has more than 48 years' of

experience in International Finance and is an active member of ICTF and NACM. She has served as Co-chair, Panel Member, and Presenter at Annual Global Conferences, and as President of ICTF Forest Products Group.

Last month, I shared comments from the three featured economists at ICTF’s Annual Symposium. This month, I’ll share some practical experience from our peers.

Angela Molgaard, Global Credit Director for Honeywell traced the cycle from a Global Credit and Treasury shared services model in 2000 to Centers of Excellence in 2003 to the dissolution of Corporate level structures with credit reporting directly to their respective business units to the re-introduction of a Global Director of Credit in 2012. Although there were initial savings in head counts and cost, the disadvantages included cost savings decreasing in subsequent years, low morale and loyalty, loss of global team aspects, lack of consistency and “credit took a backseat!” They are now in the process of rebuilding a Global Credit perspective.

David Weidinger and Michelle Baker Crail of McGraw Hill shared on leveraging six sigma to improve A/R processes and unlock working capital.

Jay Chakarow of High Radius and Scott Tillesen of Tech Data discussed credit scoring models and the place of technology. Jay listed some credit “must haves” which included effective credit decisions, minimizing low-value manual work, focusing analyst’s efforts to maximize effects, and enable streamlined communications. Scott emphasized the need for effective integration of technology and human analysis.

While Jay stressed technology, including electronic credit applications

David Greenberg of ABC Amega, in contrast, re-iterated the need for signed originals in many countries. In the light of full disclosure I remind you that I work for a paper company, but I vividly remember asking a bankruptcy judge in Mexico, if they would accept electronic records since Mexico was now a signatory to E-Commerce. The answer was “the law says yes but it will be many years before the majority of our bankruptcy judges accept electronic documents.” David discussed the International Credit Application as the most helpful tool for an International Collector. Credit applications should be tailored to individual countries and any special needs included. David also provided an extensive listing of Company Registration websites for 54 countries.

Fabio Yamada of Inteligencia Corporation Sao Paulo, Brazil, gave an in-depth review of Brazil and its regional economic areas. Future milestones will be the World Cup in 2014 and the Olympics in 2016. Tips for doing business in Brazil included: have a local seasoned presence, C level contacts are vital, have reliable market information by industry with political implications, consider long-term strategy versus short-term results, speak Portuguese, check legal issues thoroughly, and know your customers.

Rafael Castillo-Triana of FTAA Consultants gave an overview of legal, credit and collection issues for Latin America and the BRIC’s. He presented a schedule rating USA, Brazil, Columbia, Chile, Mexico, and Peru in the categories:

• Starting a new business • Obtaining licenses • Staffing • Funding • Credit Bureau information • Enforcing Contracts • Customer risk • Credit Recovery • Collateral re-possession • Resolving insolvency • Doing Business Rank and • Doing Leasing Rank

The symposium ended with a country Roundtable moderated by Paul Beretz which generated extensive audience participation.

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NACM Oregon



NACM-Oregon Foundation Scholarships The NACM-Oregon Foundation grants scholarships to credit professionals for continuing education, professional designations, and conference expenses. To apply for scholarship funds, or for more information, contact Lourdes (Lou) Rice, NOF Scholarship Committee Chair, Pacific Metal Company at 503.454.1051 or [email protected]. The categories are as follows.

NACM National Credit Congress May 19-22, 2013, Rio Hotel, Las Vegas, Nevada Two (2), $700 scholarship. Deadline: March 31, 2013

CFDD National Conference—

September 19-20, 2013, Albuquerque Marriott, Albuquerque, New Mexico Four (4), $500 scholarships. Deadline: July 31, 2013

Phylliss Clark Scholarships

Two (2), $500 scholarships. Applicants must be a CFDD member of the respective chapter and a first-time attendee to the CFDD National Conference. Each CFDD Chapter—Portland and Salem/Albany is allowed one scholarship funding.

Deadline: July 31, 2013

Phylliss Clark Memorial Fund The Phylliss Clark Memorial Fund was established in honor of the well-known and respected manager of the NACM Oregon education/communications department, who died in an auto accident Memorial Day weekend in 1993. Because of Phylliss Clark’s strong interest in and commitment to education, and her dedicated service to NACM and CFDD, it was determined that a fitting memorial would be to establish an endowment in her name, the earnings of which would be used to promote education of deserving credit professionals. Each year, earnings from the endowment are distributed as scholarships to selected members of the two Oregon-area Credit & Financial Development Division (CFDD) chapters to offset registration and attendance costs to the CFDD National Conference. In selecting these yearly scholarship recipients, special recognition is given to first-time attendees of the conference.

Professional Certification FeesTo establish your file with NACM National; reimbursement of exams fees after a passing grade; recertifications (NOF pays for 50% of the fee)—$1,000 total; and

$1,000 total for seminars and classes related to certifications.

Western Regional Conference October 16-18, 2013, Golden Nugget Resort & Casino, Las Vegas, Nevada Four (4), $500 scholarships

Deadline: August 31, 2013

To apply—

To apply for scholarship funds, or for more information, contact Lourdes (Lou) Rice, NOF Scholarship Committee Board Direc-tor, Pacific Metal Company at 503.454.1051 or [email protected].

Submit applications to:

Lourdes (Lou) A. Rice NOF Scholarship ChairPacific Metal Co. 10700 SW Manhasset Dr. Tualatin, Oregon 97062

p: 503.454.1051

503.454.1065

[email protected]

http://www.nacmoregon.org/about/foundation.html

mailto:lrice%40pacificmetal.com?subject=

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NACM Oregon



If more creditor grantors would report their commercial accounts receivable to the credit bureaus, everyone would reap the rewards—your customers, your credit managers, your collection managers, your finance managers—even your sales force. Reporting data is simply modernizing what you do already—exchanging information to reduce risk.

The idea behind automated reporting is to share your information in a way that makes you comfortable, while maintaining the highest degree of accuracy possible. Almost every business that reports information has one or more of these concerns at one time or another - dealing effectively with all these issues is the core business of credit reporting agencies. Since the credit bureaus first began automating their systems in the early seventies, they have evolved to accommodate just about every scenario. Today, the demands for highly detailed, accurate and current information, delivered at lightening speeds, have driven firms such as Experian, D&B, and NACM to be highly creative and much more aggressive in providing not only the right incentives, but a “programmer friendly” environment.

With so much legislation surrounding the use of consumer credit information, the ability to access enough ‘business’ data is becoming a necessity. Manual reference checking in the consumer-lending environment today is practically unheard of. Why? Virtually every legitimate credit grantor reports to at least one bureau, if not to all three. Even if not required by law, consumer creditors quickly get used to the idea of reporting after fielding

Reporting Your Credit Experience: Is It Worth Overcoming the Obstacles? by Michelle Herman

hundreds of calls from irritated good-paying customers who can’t get credit elsewhere due to a lack of credit! Think about it: If you personally have good credit, don’t you want the world to know about it? Or at least your next creditor? Wouldn’t you be a bit upset if you couldn’t get the 15 percent discount that the nice salesperson at Nordstrom’s told you about just for opening a new charge account with them right there at the register? You’d be paying full price for that pile of new clothes if your best and biggest “suppliers” were not sharing your payment experience every month to the bureaus. Is your company contributing to this frustrating environment or to the credit bureaus?

Confidentiality Issues One of the major causes of concerns was the fear that your customer base will fall into the wrong hands. Protection of your customer information extends deep into the processes and is the cornerstone of these bureaus’ existence. A few of the many procedures in place to keep your information only where it belongs include (1) identifying your trade experience by a business category instead of your name, (2) high security electronic data transmissions, (3) numeric internal identification, (4) password protection, and (5) separation from compiled marketing files.

As far as using your credit file as a source for marketing lists, no bureau in its right mind would do it as it could poten-tially dry up their “inventory” and eventually put them out of business. Most of the major firms that provide business-to-business marketing lists

compile them from hundreds of other sources such as yellow and white page listings, purchased demographics, telephone surveys, and public records. The only use of the credit file is to provide risk assessment on a list that’s already been selected from the marketing database or another outside marketing file. Allowing your data to be mined by your competitors would not only be unethical, but would seriously impact the continued success of these bureaus.

Do you fear that your competitors will figure out your largest and best-paying accounts and steal them away? I hate to break the news to you, but if your competitors have half-decent sales people, they already know everything about your best customers, including your arrangement. Thank your customers for that. It’s amazing how much your “best” customers will reveal to your competitors when they are trying to get a better deal for themselves. Luckily, simply knowing the quantity, the volume, the payment experience, or even your price, does not mean that your competitors will be able to steal your clients. If that were the case, they would have put you out of business long ago. The credit bureaus don’t want to make it any easier than it already is for those sales reps, so they never disclose your identity on credit reports or to your customers, unless you specifically authorize it.

Accuracy Concerns Another concern expressed by those not participating in credit reporting programs was that of the accuracy of the data. Clearly, no one wants to have potentially erroneous information reported. Don’t worry. The bureaus don’t want you to either. If you know your receivables have some serious issues it’s certainly better to hold off reporting for now.


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NACM Oregon



But if you seem to be plagued by some fishy disputes, unreasonable deductions, too many unreturned phone calls, or “unknown issue” accounts there is no better (or cheaper) way to clean up your A/R and bring all the legitimate disputes to the surface than to announce to your clients, very politely, that you will soon be reporting to a national credit bureau, and that you hope to be able to report them in a positive light. You’ll typically get three responses: “Wait—don’t report me as past due! The reason we have not paid yet is...”; “Wait—don’t report me past due! I am sending my payment today...;” or simply no response at all, which usually means they have no intention of paying you, so go ahead and report them.

You may be amazed at the positive response from many of your clients. They have the desire to show their company in the best possible light and will help you to accurately portray their company. Their assistance will increase the accuracy of your information and insure that accurate information is reported to bureaus. Is this just another crazy idea from those people at the bureaus who just want your data? Not at all. This is a real life tactic that has been created and successfully utilized by credit managers across the country for years. Your bureau representatives should be able to provide several examples of actual letters used, along with some other creative approaches. It costs nothing, and has continually proven to be effective.

Technical Concerns Maybe you have finally come to the conclusion that the “pros” of reporting outweigh the “cons” and it’s now become one of your top priorities. Unfortunately, it’s probably not the priority of your technical team. This has been the most common obstacle over the years, so the

Reporting Your Credit Experience, continued from page 9

bureaus have been working diligently behind the scenes to keep your IT department stress-free by getting them off the hook for writing data extract programs.

Many of today’s accounts receivable software packages already come equipped with the credit reporting module built right in: JD Edwards, Infinium, Lawson, Woodware, ADP, Distinctive Solutions, Ontario Systems, Columbia Ultimate Business Systems, Great Plains, Peachtree, SAP, Oracle, RealWorld, and MAS 90 are just a few. Many others have simple extract instructions to pull your summary aging data out in a fixed length file, which you can email or FTP—with the bureaus doing all the work. Typically, a team of experienced programmers partners with you to accommodate virtually every situation or special customer.

Making the standard data extract formats more readily available in A/R software packages is the real long-term solution for all parties. What is considered “standard” these days? Typically, commercial credit bureaus will readily accept NACM, Metro, Metro 2, and Experian Business. While the bureaus are continually trying to work with these A/R software companies, nothing makes those folks move faster than when enough of their “users” initiate the requests. If your accounts receivable software provider doesn’t offer this basic functionality, ask for it!

OK, you’ve made it past the decision to do it, you’ve notified your customers, you’ve overcome the technical hurdles, but now someone suggests you talk to your attorneys. The typical concern: “Is this legal?” The answer: “Absolutely.” What’s illegal is knowingly reporting false information. Everyone will occasionally

encounter special circumstances that may require removal from a credit report: disputes; data entry errors; transposition; etc. This hardly constitutes a malicious intent to harm your customer by purposely reporting false data. Disputes can be reported as such, or simply not reported or displayed. It’s your call. With any credit bureau, removing data can be done easily by sending an explanation on company letterhead.

The answer to the debate is simple. It makes good business sense to report commercial and consumer information to at least one of the credit bureaus, if not all. Reporting ultimately allows you—and other credit grantors—to reduce risk and make more profitable credit-granting decisions. It’s a continually proven fact that businesses, as well as individuals, are more likely to pay off debts to those creditors that report their credit performance. By sharing your customers’ trade payment experience, you help to ensure the growth of your company and that of the business community at large. By encouraging your industry peers to also do their part in becoming a proactive member of the credit community, everyone benefits.

Michelle Herman, the former Director of Business Development at Experian Business Information Solutions, currently works for NACM Tampa and with the NACM affiliates helping to build the NACM National Trade Credit Report.

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NACM Oregon



National Summary of Domestic Trade Receivables—2012 Annual Bad-Debt Report We received the National Summary of Domestic Trade Receivables Annual Bad Debt Report for 2012.

Based on the results of this report, the Allowance for Uncollectables during 2012 was 0.70% of receivables. This is an increase of 0.20% over 2011. Bad Debt write-offs during 2012 totaled $24.30 per $100,000 of sales. This is an increase of $3.80 over 2011.

We thank our members and all of you who participated in the survey.

Please contact Customer Service or your Account Executive for a copy.

National Summary of Domestic Trade Receivables Results 4 Quarter 2012 We have received the results of the National Summary of Domestic Trade Receivables (DSO) for the fourth quarter of 2012. The Credit Research Foundations (CRF) has been producing this valuable quarterly report for more than 50 years.

DSO slightly decreased from the prior quarter to 39.97 from 40.35. A year ago the measure was 40.19. Best Possible DSO increased to 32.15, as compared to 31.70 last quarter and 31.10 a year ago. Average Days Delinquency decreased to 4.30 from 4.80, as compared to 6.30 a year ago. The percent reported over 90 days past due decreased to 0.41 as compared to last quarter at 0.50, as compared to 0.66 a year ago.

Medians for 28 different industries are included in this summary. If any SIC code has less than three responses, it will not appear in the report.

Please contact Customer Service or your Account Executive for a copy.

Now that you’ve done the NSDTR, if you really want to see how you’re doing, you’ll want to participate in CRF’s comprehensive Benchmarking survey. You can do that at: http://www.crfonline.org/surveys/benchmarking/benchmarking.asp.

CRF NewsThe Fourth Quarter 2012 Edition of the CRF News is available.

This issue rings in the New Year of Economic Predictions by three preeminent economists: Mark Zandi, Chris Kuehl, and Richard Hastings.

Other article topics include:

• Remittance Coalition survey data on Remittance Detail obstacles • Attorneys vs Collection Agency comparison • Current state of credit department operating budgets • Boosting delinquent account cash flow • New ideas in evaluating country risk

Please contact NACM Oregon Customer Service or your Account Executive for a sample copy.

http://www.crfonline.org/surveys/benchmarking/benchmarking.asp

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NACM Oregon



Quality of Service What is often overlooked is that the credit or collections group, whether they are company employees in a different location or a fully independent third-party organization, working for a company in an abroad location actually become the face of the organization. Oftentimes, especially after the easiest (“low-hanging fruit”) accounts have been cleared, staffs comprised of newer collections agents, for example are not as successful as a seasoned veteran, or as experienced as those that would surround them at a the domestic office. Countless credit managers have found that the quality and speed of work often does not match up when comparing newer, outsourced talent with those from existing staffs and surroundings.

Turnover Other than the quality of service, perhaps the most overlooked factor in an outsourcing decision is rapidly rising wages. Once these, often young, employees receive training, they often have many other options because areas of

Outsourcing Credit, continued from page 1

outsourcing tend to attract more and more operations doing the same for other companies. This leads to bidding wars and, often, flight to a competitor for as little difference as a couple of extra dollars per month. It isn’t uncommon for entire staffs to changeover in two years or less, sometimes in as little as six months in places like India.

Public Relations Outsourcing runs a high risk of having to clean up unwanted public relations messes. High unemployment breeds contempt in any country, and it’s even more so if “their” jobs are being sent elsewhere. Additionally, there have been reports of lax controls leading to embarrassing snafus such as when a New York-based regulator publicly outed Standard Charter’s money-laundering controls as “deficient” and to blame for allowing “questionable transactions” in Iran to occur. In addition, call it nationalism, prejudice, or the reality of simply not being able to understand what’s being said, customers want to hear from someone that sounds

like them during a credit or collections call. Many polled by NACM in the United States and Europe noted a similar refrain that, “most customers just want to be called by someone from their own country.”

Artificial Cost Savings All three reasons listed above add up in varying ways to what can be its own fourth category: that outsourcing can be, in the end, artificial cost-savings. Short-term gains are all well and good, but what’s the point if they cannot be sustained. Poor quality of service means customers, whether consumer or business based, might look elsewhere for product. High turnover means retraining new staffers, often with little or no experience, and dealing with potentially costly mistakes as these newbies get their proverbial feet wet. Bad public relations, like bad service, can also send customers directly into the arms of a competitor. And, once they’re gone, good luck getting them back.

Reprinted with permission from NACM National.

2013 Credit Congress & exposition

Join us at the

Rio Hotel, Las Vegas, May 19-22,

2013, for the year’s

largest gathering of

business credit professionals in

the country.Get registered

today!

http://creditcongress.nacm.org/register-2013.html

March/April 2013

NACM Oregon



Webinar Program on the Move!Effective March 1, NACM Oregon is joining forces with NACM National in the Credit Learning Center (CLC), a 24/7 online learning venue.

The NACM CLC was created to provide educational sessions for today’s busy credit professional. This easy and convenient method of learning offers a wide array of topics carefully designed by a team of credit professionals from each respective field.

Join your colleagues and participate in stimulating online educational presentations. Using a chat function, share your comments and questions to enhance the quality and diversity of the conversation. Feel as though you are in the room with the speaker and sharing the educational experience without leaving the office.

Don’t forget to take advantage of your two complimentary webinars which is included in your Full Membership Package.

To learn more about the Credit Learning Center please visit http://www.nacm.org/credit-learning-center.html and click on the links.

Credit Learning Center

UCC Filings - Writing an Effective Security Agreement and Collateral Description March 13 12 - 1 p.m. (W/60 Min. - PT)

10 Provisions of the Bankruptcy Code Every Credit Manager Should Know March 20 12 - 1 p.m. (W/60 Min. - PT)

Financial Statements: Credit Worthiness Evaluation Tools and Processes April 3 12 - 1:30 p.m. (W/90 Min. - PT)

Bankruptcy War Stories: Practical Lessons Learned from the Trenches (What Textbooks Don’t Tell You) April 10 12 - 1 p.m. (T/60 Min. - PT)

Judgment Enforcement Options—What is in Your Collection Arsenal? April 22 12 - 1 p.m. (T/60 Min. - PT)

Defending Preference Claims June 10 12 - 1:30 p.m. (T/90 Min. - PT)

Upcoming Webinars and Teleconference at the Credit Learning CenterEducation webinars are $69.95 for individual modules. Your purchase allows you two viewings of the presentation. (W) = Webinar; (T) = Teleconference

http://www.nacm.org/credit-learning-center.html

March/April 2013

NACM Oregon



Visit www.nacmoregon.org/events to register online. If you have any questions regarding these classes, please call Elizabeth Heintz at 971.230.1182 or email [email protected].

Certification Roadmap Intro Complimentary to Members! March 19 11:30 a.m. - 1 p.m. (includes lunch)

NACM Oregon Classroom, Ste. 201

Construction Days Presented by Sussman Shank, LLP Oregon, Washington & Idaho Lien Law Course Level: I Day 1 April 3 8:30 a.m.-4 p.m. NACM Oregon Classroom, Ste. 201

Construction Days Federal Miller Act, Bond Claims, Washington Retainage Claims, Bond Checks Course Level: I Day 2 April 4 8:30-11:30 a.m. NACM Oregon Classroom, Ste. 201

Negotiation Skill Building Presented by David L. Osburn, MBA, Osburn & Associates, LLC Course Level: I April 25 8:30-11:30 a.m. Embassy Suites, Portland Airport

Course LevelsC (core) – Classes that focus on credit concepts, techniques, and practical tips. They are designed for the newer credit department employee and the more experienced credit professional looking for a review;

I (intermediate) – Classes assume basic knowledge of credit concepts and address specific issues and approaches to resolution;

A (advanced) – Classes that assume significant knowledge and experience and address complete topics of interest to credit and financial professionals.

"Col

lectio

ns For All Seasons"

Professional Development RetreatMarch 8 and 9, 2013McMenamin's Edgefield8:30 a.m. - 4:30 p.m.

McMenamin’s Edgefield 2126 SW Halsey St. Troutdale, Oregon

A comprehensive course in collecting commercial accounts receivable, presented in a two-day series, co-sponsored with CFDD Salem-Albany and CFDD Portland Chapters. This course is designed to provide up-to-date techniques, management, and professional requirements for individuals involved in commercial collections. It is designed to take you from basic to advanced levels.

For more information or to register contact Brett Hanft, CBA, at 503.520.5451 or [email protected].

It’s Not To Late To Sign Up for—2013 Spring Education

In-house Class Schedule Mark your calendars for these exciting events!

www.nacmoregon.org/events

mailto:eheintz%40nacmoregon.org?subject=

mailto:hanft%40lumber.com?subject=

March/April 2013

NACM Oregon



Garnishing, continued from page 1

passed the Riegle-Neal Interstate Banking and Branching Efficiency Act of 1994 (IBBEA) which was codified to 12 U.S.C. § 1811, which in general was designed to make branch banking more efficient by nationalizing the process for national banks, and regulating state chartered banks that wanted to expand to different host states. As result, national banks went to a state depository framework, with each state having its own depository network, and a levy within the state would capture all accounts in every branch within that State.

In 2004, The Department of the Treasury issued Regulation 12 C.F.R. 7.4007, which authorized national banks to take deposits without regard to state law. Therefore many national banks have created a single depository framework, rather than dividing the accounts into a patchwork of 50 depositories. As part of that process, many banks inserted into its account agreement a provision which allows the bank to maintain a single set of books and to honor levies on a national basis. As been recently ex-plained to me by a national bank, the bank “does not maintain 50 mattresses, one for each state, each with money in it. Rather, it maintains a single mattress for the entire bank.”

What if your judgment debtor uses a state chartered bank with locations in different states, including the state where the judgment was entered? While not universally held, courts have determined that a bank does not have physical custody of a depositor’s money at a particular site. Instead, a general deposit into a bank account creates a debt owed by the bank to the depositor. As a result, the judgment creditor can assert that it is the receivable owed by the bank that is being collected, not the actual funds, that provides the basis for recovery.

In the end, we ask do the outcomes described above make common sense? The fact that Congress authorized the Department of the Treasury to allow national banks to do the same is sound in today’s national, if not global, economy. Additionally, the principle that the corporation could do business across state lines, but insulate itself from a single levy makes little sense.

Critics may argue that the judgment debtor’s account is physically located in its home state where it was opened, and the garnishment should not reach the funds in the account. Those same critics may assert that the judgment creditor should simply domesticate the judgment in the judgment debtor’s home state pursuant to full faith and credit, and garnish in that state. In

practice, however, in most states the judgment debtor would have notice of the domestication and be afforded an opportunity to move the funds before the garnishment took place. In the end, whether using the theory of a single depository or a bank receivable, judgment creditors and the overburdened legal system are ben-efited by the ability to garnish against a bank with locations in their home state.

Rewritten with permission.

Bradley Blakeley, Esq., earned his bachelors degree from Loyola University, Los Angeles, California, and his law degree from Santa Barbara College of Law (J.D.). Practice areas he specializes in are: commercial law and bankruptcy litigation. He can be reached at [email protected].

mailto:bblakeley%40blakeleyllp.com?subject=

March/April 2013

NACM Oregon



ChairmanJohn Hardy Emerson Hardwood Co. [email protected]

Vice Chair Marsha Johnson, CCE TEC Equipment, Inc. [email protected]

Secretary/TreasurerPat Swope, CCE, CICP Pacific Seafood Co., [email protected]

CounselorRaeann Binau, CICP, RGCP Airgas - Norpac, Inc. [email protected]

Directors Steve Amiel Tektronix, [email protected]

Linda Bishop, CCE, CICP Tektronix, [email protected]

Will Campbell Standard Supply [email protected]

Tony Ceniga Industrial Finishes & [email protected]

Paula Cooley, CBA American Steel [email protected]

Sue Hein Rapid Bind, [email protected]

Lori Jones, CCE [email protected]

PresidentRod Wheeland, CCE, CAE NACM [email protected]

Customer Service/ Credit Reporting971.230.1220 [email protected]

Data ContributionShannon Abnal, CGA 971.230.1166 [email protected]

Member Services Kathy Linscott, CGA 971.230.1164 klinscott@nacmoregon

Member Services Account Executives Clara Nemeth, [email protected] Denise Redding, CGA 971.230.1178 [email protected]

National Account Executive Caroline Anderson, CGA 971.230.1168 [email protected]

EducationElizabeth [email protected]

Industry GroupsRichard Browning, CGA 971.230.1188 [email protected]

Kristen McBride, CGA 971.230.1176 [email protected]

Collection ServicesBrenda Terreault, JD, [email protected]

BillingMarmie Carpenter971.230.1146 [email protected]

Meeting Room RentalElizabeth [email protected]

Newsletter EditorBarbara Salazar971.230.1182 [email protected]

Board of Directors NACM Oregon

Contacts

mailto:jhardy%40emersonhardwood.com?subject=

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mailto:[email protected]


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mailto:rwheeland%40nacmoregon.org?subject=

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NACM Oregon Business Credit Journal · Certified Credit & Risk Analyst (CCRA) This designation was...

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