Read our insights into the credit control function

  • 06-11-23
  • Marc Dalusag | Richard Lloyd

The role of the Credit Control Officer is an integral part of any successful business. Also referred to as a Credit Officer, Accounts Receivable Officer or Credit Controller, they are charged with maintaining a steady cash flow and allowing the business to function with stability. To understand how essential a dedicated Credit Controller is, we will need to explore their pivotal role in the finance team, why a company needs one, the key skills required for the job, and how to assess those skills.

The role of a Credit Control Officer

A Credit Control Officer is responsible for overseeing a company's accounts receivables, ensuring that customers pay their invoices on time. Primarily their focus involves managing credit risk and debt collection, minimising bad debt which is vital for maintaining healthy cash flow. 

In many ways, they safeguard the company's financial stability which becomes a necessity if a business is planning on expanding. For a more in-depth review of a Credit Controller’s job description, click here. Also for some insights into the key differences between a Credit Controller and an Accounts Receivable Officer, click here to compare the two titles.

Why an organisation needs a Credit Controller

At their core, businesses need a healthy cashflow to thrive, a dedicated Credit Officer can be crucial to the business’ success for many reasons:   

Minimising bad debt: A Credit Controller's primary responsibility is to assess the creditworthiness of customers and establish credit limits. This is done to identify the risk of extending credit to unreliable clients and reduce the likelihood of bad debt.

Improving cash flow: By actively managing the accounts receivable, the Credit Controller ensures that invoice payments are received promptly, thereby improving the company's cash flow. With a steady cash flow, the business can cover its operational expenses and invest in growth opportunities.

Legal compliance: Credit controllers are well-versed in the regulations related to credit and debt collection. They ensure that the company's credit practices are compliant with the law, reducing the risk of legal issues.

Customer relationships: Whilst their role often involves chasing overdue payments, Credit Controllers also work to maintain positive relationships with customers. This is a balancing act that is essential for maintaining ongoing business relations.

Key skills to look for in a Credit Controller

Effective Credit Controllers possess a range of skills and attributes that contribute to their success. When hiring for this role, consider these key skills:

Financial acumen: A strong understanding of financial concepts, including credit risk assessment and financial analysis, is crucial for making decisions to minimise risk.  

Communication skills: Excellent communication is a requirement as it is vital for interacting with customers and maintaining these relations while still negotiating favourable payment terms. 

Attention to detail: While precision is essential for all members of the financial team, it is a pivotal skill as an Accounts Receivable or Credit Officer to avoid errors and oversights in transactional tasks. 

Problem-solving and negotiating abilities: Credit Controllers are posed with problems that are unique to their position. As they are required to manage relations with others and establish payment schemes that are suitable for both sides of a business transaction. 

Analytical thinking: The ability to analyse data and make informed decisions about credit limits and debt collection strategies is a core competency to ensure that the business's financial stability is maintained.

Legal knowledge: Familiarity with relevant laws and regulations, especially those related to debt collection, is beneficial as it aids in making decisions based on a customer’s creditworthiness.

How to assess the key Skills

When evaluating candidates for a credit controller position, consider the following methods to assess their skills:

Interviews: During interviews, you should ask situational and behavioural questions to gauge their ability to carry out the duties of a Credit Controller. An assessment of problem-solving, communication, and negotiation skills would need to be addressed.

Skills assessment: Provide a sample case or scenario related to credit that would allow candidates to demonstrate their analytical and decision-making abilities.

Reference checks: Contact previous employers or colleagues to verify a candidate's relevant skills and experience, as well as their soft skills.

Credit Controller salary in Sydney

A salary for a Credit Controller in Sydney can vary based on several factors such as experience, industry, and company size. On average, salary expectations can be anywhere between $60,000 to $90,000 per year, with opportunities for higher compensation as they gain experience and expertise.

Career paths for a Credit Controller

A Credit Controller can follow a rewarding career path within the finance and accounting field. With experience, they can advance to roles such as Credit Manager or branch out into Assistant Accountant roles if they decide to undertake further study to progress. Continuous professional development through courses and certifications can further enhance their career prospects.

In summary, the role of a Credit Controller is indispensable in maintaining financial stability and ensuring a healthy cash flow for a business. By evaluating candidates based on their key skills and traits, your company can find the right credit officer to safeguard its financial interests and foster growth. Investing in a Credit Controller is an investment in the long-term financial well-being of your business.

If you are looking to hire a Credit Controller or are a jobseeker thinking about a new role, contact us for a confidential discussion.