Compliance and credit management in companies

When dealing with the theme of compliance in relation to credit management there are many general and legal requirements that need to be met. Clear guidelines for dealing with customer credit and the monitoring of the related processes is therefore needed.

Compliance themes are factors that influence the way a company trades and the way it deals with customers, at both national and international levels. These themes include credit decisions that conform with laws and regulations, bribery, corruption, money-laundering and fraud. What makes compliance legislation especially important on an international level for companies are cross-border political regulations in areas such as anti-corruption, ethical codes, export controls and the related sanctions. Having detailed knowledge of one's customers and suppliers is enormously important in this context. Being able to collect all relevant information and to use it optimally is an essential precondition for company success.

Robert Meters, Head of Sales and Marketing at Prof. Schumann GmbH, knows: "At the interface to credit management, supporting software can be extremely helpful and make the work much easier. Information relevant for making decisions is automatically collected and monitored, and when critical factors emerge a warning is sent automatically to the responsible members of staff. Processes are secured via user rights and rule-based controls. All credit decisions and the information basis are completely documented and historized."

IT-supported credit management makes possible the central storage of the relevant information and allows all activities to be comprehended and reconstructed at any point in time. It also controls and monitors processes according to the credit policy that has been decided. Justified exceptions are also suitably documented. The orderly functioning of the operational credit management can therefore be checked at any time. Alongside the necessary limits on access there must also be sufficient transparency, especially to guard against potential corruption. In credit management there is always the danger that customers are allocated credit limits without the necessary checks having been made, or that the amount of credit given is not justified. With efficient and complete documentation of these decisions, everything can be reconstructed at any time in the future. In addition, it can be technically secured that above particular amounts the agreement of at least two members of staff is necessary.