FNS40120 Certificate IV Credit Management Short Answer Questions

Question 1a

The National Consumer Credit Protection Act 2009 (Cth) (NCCP Act), which includes the National Credit Code (NCC), is important for regulating consumer credit in Australia.

List two (2) key elements imposed by the consumer lending regulatory system with regard to credit assessment. (50 words)

Question 1b

Briefly explain the concept of ‘responsible lending’ under the NCCP Act. (30 words)

Student response to Task 1.1: Question 1b

Question 2

Refer to the Toolbox for the links to the following legislation. Conduct research to answer the following questions. (80 words)

(a)       Privacy Act 1988 (Cth): What is the key requirement under this Act?

(b)       Anti-money Laundering and Counter-Terrorism Financing Act 2006 (Cth) (AML/CTF Act):
Identify the five (5) key obligations under the AML/CTF Act.

(c)       Corporations Act 2001 (Cth): Name the Accounting Standard adopted in 2005 that the Australian Securities and Investment Commission (ASIC) requires companies to comply with.

(d)       Banking Code of Practice ? What does the Banking Code of Practice set out?

Question 3 Legislative and regulatory requirements have been introduced to manage risk for both the customer and the lender. Identify two (2) risks for the customer and two (2) risks for the lender (total of four (4) risks) and what strategies and procedures have been put in place to minimise the risk. (150 words)

Student response to Task 1.1: Question 3

Question 4

How have you and your organisation maintained your currency and understanding of risk management requirements as they relate to your role? If you are not working in the credit industry, elaborate on risk management in your current or most recent workplace. (50 words)

Student response to Task 1.1: Question 4

Question 5

Within the lending process there are a number of internal parties involved. The lender, the approving area, documentation area, settlements and the review area, to name a few. Identify the controls that have been put in place by your organisation to minimise cross-organisational risk. (50 words)

Student response to Task 1.1: Question 5

Question 6a

All organisations strive for best practice for themselves and their employees. Identify at least one (1) credit related task you or a colleague routinely perform that is monitored by the organisation and could be improved in some way.

If you are not working in the credit industry, refer to the Toolbox under the subject of ‘Example of a completed disputes resolution register’. Describe the task. (75 words)

Question 6b

Explain how it could be improved and how managing the risk better would benefit the client and the organisation. (100 words)

Student response to Task 1.1: Question 6b

Question 7

(a)      Describe at least three (3) different types of risks involved in the role of credit management.

(b)      With reference to the risk management strategies in the organisational policy and procedures document (available in the Toolbox), identify the risk-mitigation practices (tools and methods) that your organisation has implemented to minimise financial risk.

           (100 words)

Task 1.2      Planning your personal development — Action plan

Complete the template to:

• assess your current situation
• identify goals
• determine how to achieve those goals, both short-term and long-term.

By working through the steps in the template you will build a personal development action plan.

It is suggested that you complete the plan as you work through the course. In doing so, you may highlight issues which are not apparent or obvious at the moment. (200 words)

Now that you have worked through the plan, you will probably have some long-term goals and action points, and some short-term ones. (150 words)

Some of your major long-term goals may need to be broken up into smaller sub-goals. Follow these steps:

• Consider your long-term and your short-term goals and plans.
• Consider the Pareto Principle — what possible actions will have the greatest results?
• List the three (3) most important issues that you need to address.
• Decide how you will address the issues identified above and put a time frame against each of these.

Task 1.3      Analysing work tasks

Question 1List the work tasks you perform on a daily basis. (40 words)

Question 2 Assess at least four (4) tasks from the list in Question 1 in terms of the dimensions and models discussed in the topic, specifically:

• Efficiency
• Competency to complete the task
• Focus and relevance of the task
• Systems and tools available to complete the task.

(75 words)

Question 3 From the list in Question 1, identify at least two (2) tasks where there are opportunities for improvement. Explain how you can improve the way these tasks are completed. (80 words)

Question 4

In every organisation it is the individual’s responsibility to manage their own continuing professional development (CPD) and maintain currency and compliance. Reference should be made to the Organisational policy and procedures document available in the Toolbox.

Explain at least three (3) ways you can monitor, manage and maintain your currency, compliance and CPD. (75 words)

To pass this subject, you will need to be assessed as DEMONSTRATED for either your first submission or your resubmission.