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The Association of Credit Professionals

Managing your Policy, Process and Controls

It is increasingly important for us as Credit Professionals to constantly focus on this area of responsibility. We are an “owner” of key business processes and breaches within Credit Management can have serious and sometimes even catastrophic impacts on the business.

In general terms the three can be defined as:-

  • Policy -  communication and enforcement
  • Process -  how we clearly define processes and continually review
  • Controls -  ensuring compliance and education

Policy.  A few things to consider whether you have effective Policy:-

–      How often is it updated? Factors elsewhere in the business may need to be reflected by a Policy addition or change

–      Does it clearly show defined processes?

–      Are breaches of Policy reported formally?

–      Is it a document “lost in transit?”  - written and filed away?

–      Are authorisation matrixes reviewed in line with changes in your business?

–      Is segmentation of duties rigorously enforced?

–      How is Policy communicated to staff? eg is it on an Intranet


–      Is there clear understanding where the Credit Management processes fit into the company’s overall processes?

–      Are these clearly illustrated for ease of understanding? eg flowcharts versus text

–      Do the processes cause delay elsewhere in the business that negatively impacts performance?

–      Are the processes tested and reviewed for improvement?

–      Will any change affect another part of your business?

Finally, controls and compliance.  We have our Policy and processes written and distributed but we must ensure that the controls are embedded and enforced. Some factors to consider therefore:-

–      Stringent “policing” of the Policy and Processes

–      Breaches reported and immediately acted upon

–      Compliance Self Audits

–      Incorporate Fraud Prevention checks?

–      IT security support -  eg access denials for certain users


Jon Swan, Executive Director