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AP Today:Bottlenecks,Benchmarks &Best Practices2021 SURVEY REPORT

A P T O D AY: B O T T L E N E C K S , B E N C H M A R K S & B E S T P R A C T I C E STable of ContentsIntroduction3The Biggest Accounts Payable Headaches4Key Drivers of AP Headaches4Dynamics of AP Headaches7Role of Technology in Mitigating AP Pain Points8Best Practices & Recommendations for Action10Survey Demographics11About Stampli213W H I T E PA P E R Treasury Webinars Stampli // www.stampli.com

A P T O D AY: B O T T L E N E C K S , B E N C H M A R K S & B E S T P R A C T I C E SIntroductionIn partnership with Ernie Humphrey, CEO at Treasury Webinars, Stampliconducted the original survey, “AP Today: Benchmarking the Current Stateof the Union.” The purpose of this study was to help treasury and financeprofessionals benchmark, identify, and manage root causes of AP headaches.The cross-industry survey was launched in March of 2021 and focused oncompanies headquartered in the United States of America. We surveyed282 participants with roles including Accounting Manager, Finance Manager,Finance Director, VP of Finance and CFO. The following industries werealso represented in the survey: Banking and Financial Services, Software/Technology, Professional Services, Healthcare and Health Services, Insurance,and Manufacturing.This whitepaper discusses key survey results and their implications, andoffers recommendations companies can refer to when making their decisionto invest in AP Automation.3W H I T E PA P E R Treasury Webinars Stampli // www.stampli.com

A P T O D AY: B O T T L E N E C K S , B E N C H M A R K S & B E S T P R A C T I C E SThe Biggest Accounts Payable HeadachesIn order for companies to identify areas that need attention, ask the right questions, and manage drivers ofaccounts payable efficiency, it’s important to explore benchmarks relative to key junctions in the P2P process.To set the stage for this discussion, we asked respondents to identify the AP headache they found to be themost painful within their AP function.Biggest AP HeadachesFigure 1 - AP Headaches20%15%10%5%Slow ApproversToo Much Paper18%Too Many Manual Processes15%15%Too Few People On Our AP teamToo Many Invoices12%Too Many Processing Errors8%Too Much Time Spent on Calls and/or Emails8%6%6%Approvers Complaining5%Too Many Late Payments4%Lame Technology - We Need Automation0%As Figure 1 illustrates, many companies feel direct pain caused by manual processes, an overreliance onpaper and spreadsheets, and all the associated headaches. It’s also clear that approval processes are acommon cause of friction in the procure-to-pay (P2P) lifecycle.Approval Workflows & Bottlenecks: Key Drivers of AP HeadachesAn analysis of the survey data suggests that several AP headaches may be related to bottlenecksoccurring at various junctures of approval along the P2P process. Approvals that span the P2P processoften include approving a purchase order (PO), approving an invoice to be reviewed for payment once allthe documents are in order, and approving the payment of an invoice once it is in the payments queue.We identified several potential root causes for bottlenecks at each of these approval junctions.4W H I T E PA P E R Treasury Webinars Stampli // www.stampli.com

A P T O D AY: B O T T L E N E C K S , B E N C H M A R K S & B E S T P R A C T I C E SPurchase Order Approval - Potential Root Causes of BottlenecksFigure 2 - Who Decides What to PurchaseFigure 3 - PO Approval Methods2-Way MatchingOur Procurement TeamIt Is Done By Department25%34%Both3-Way Matching42% 42%37% 37%38%4-Way MatchingWe Do Not use POs14% 14%13%13%In terms of POs, approval timing and approver complaints may be impacted by who decides what topurchase and the method used to approve a PO.Invoice Approval for Payment - Potential Root Causes of BottlenecksFigure 4 - How Companies Assign InvoicesFigure 5 - Invoice Approval MethodsBy Department44%E-MailBy Location10%By VendorBy Business Unit29%Random Assignment28%AP Automation Tool11%44%Verbal (Phone/In-Person)21%Digital ChatBy Amount23%Text28%16%ERP37%10%Who is assigned to approve an invoice may also impact the speed at which it gets approved to beeligible for payment. How an invoice can be approved can impact this timing as well. Special criteria forapprovals based on invoice criteria add complexity and friction to the approval process.Figure 6 illustrates that many companies leverage special approval criteria. Approvers need access tothe data they need to review an invoice, and a way to approve an invoice that offers an audit trail anddoesn’t impact their productivity.5W H I T E PA P E R Treasury Webinars Stampli // www.stampli.com

A P T O D AY: B O T T L E N E C K S , B E N C H M A R K S & B E S T P R A C T I C E SInvoice Approval for Payment - Potential Root Causes of Bottlenecks (cont’d)Figure 6 - Do You Have Special Approvals Based on Invoice Criteria?Yes, For Certain VendorsYes, For Certain Threshold Amounts34%31%NoYes, General Ledger (G/L) Account Specific28%7%There can also be one final bottleneck when a payment or batch of payments sits in a queue to be released for payment.These delays – intentional or not – can be meaningful in managing working capital and/or in managing supplierrelationships. Figure 7 depicts the amount of a time pending payments can sit in an approval queue.Figure 7 - Average Number of Days to Approve a Payment in the Payments Queue35%2 Days or Less33%3 - 5 Days6 - 10 Days11- 20 Days21 - 30 DaysMore Than 30 Days14%8%5%5%The magnitude of approval bottlenecks can also be seen in benchmarks related to how long it takes an invoice received tobe approved for payment. Figures 7 depicts how long on average an item stays dormant at two key junctures of the P2Pprocess and Figures 8 incorporates company size to assess the impact this might have on the wait time.6W H I T E PA P E R Treasury Webinars Stampli // www.stampli.com

A P T O D AY: B O T T L E N E C K S , B E N C H M A R K S & B E S T P R A C T I C E SInvoice Approval for Payment - Potential Root Causes of Bottlenecks (cont’d)Figure 8 - Average Number of Days from Invoice to Payments Queue and Payments Queue to Payment by Company SizeInvoice Receipt to Queue1189987Small (0-99 Employees)Payment Queue to PaymentMedium (100 - 1,000 Employees)Enterprise (More than 1k Employees)The Dynamics of AP HeadachesCertain AP headaches identified by companies are root causes for other headaches. One glaring example – processingerrors – can be fueled by too many invoices and too few employees. Figure 9 and Figure 10 illustrate that AP teamsmay be thinly staffed and are faced with a significant number of invoices to process each month.Figure 9 - Number of AP Full Time EmployeesFigure 10 - Average Number of Invoice Processed Each Month16%2-56-1029%41%501 - 1,00023%251 - 50021%100 - 250More than 5,00016%16%1,001 - 5,00015%Less than 1008%24%7W H I T E PA P E R Treasury Webinars Stampli // www.stampli.com

A P T O D AY: B O T T L E N E C K S , B E N C H M A R K S & B E S T P R A C T I C E SThe Dynamics of AP Headaches (cont’d)Other root causes of processing errors include how a company receives invoices from suppliers, the number ofsuppliers a company manages, and the prevalence of one-time (one-off vendors). Survey respondents indicatedthey’re dealing with these potential causes of processing errors: Over 40% of companies still receive invoices via paper as opposed to electronically. Paper often meanskeying and/or re-keying of information into one or more systems. More paper leads to more processingerrors. Thirty-one percent (31%) of companies surveyed have at least 500 unique vendor relationshipsto manage while 73% of companies are primarily managing supplier relationships via email and/orspreadsheets. Email and spreadsheets lead to excessive time spent on the phone with suppliers managing. Thirty-three percent (33%) of companies have over 25% of all vendors that can be classified as one-offvendors. It can be cumbersome without the right processes and technology to add any vendor, so thenumber of one-off vendors can have a meaningful impact on processing efficiency. Furthermore, an underinvestment in technology to support accounts payable success can lead to everytype of AP headache previously discussed, in addition to late payments and too much time spent onsupplier calls and emails.Role of Technology in Mitigating AP HeadachesAn underinvestment in solution seeking and implementing ways to support accounts payable success can lead toevery type of AP headache previously discussed plus more, including:8 A lack of visibility into AP related processes and supplier activity. A lack of collaboration within accounts payable and all company employees involved inAP related approvals. Barriers to effective collaboration with suppliers. Late payments. Too much time spent on supplier calls and emails. And more.W H I T E PA P E R Treasury Webinars Stampli // www.stampli.com

A P T O D AY: B O T T L E N E C K S , B E N C H M A R K S & B E S T P R A C T I C E SRole of Technology in Mitigating AP Headaches (cont’d)One way companies can solve for such headaches is to consider introducing technology to automate and centralizeAP processes. Though the idea of bringing in technology to serve as a “painkiller” within the AP function might feeloverwhelming to some, the positive results far outweigh the upfront effort, especially when you’ve done due diligencewhile researching available solutions. Here’s what to look for when assessing AP Automation options.Choose an an AP Technology Solution That I.II.Streamlines processes to reduce friction throughout the P2Pprocess. Leading AP solution functionality includes:Gives 360-degree visibility into invoice status and metricsusing advanced search, reports, and management dashboardwhile offering:Checkpoints to Consider: Automated invoice information capture Artificial intelligent (AI) powered general ledger coding Easy automated invoice routing and re-routingCustomizable approval thresholds, separation of duties,and workflow automationCheckpoints to Consider: A complete audit trail of all P2P related activity A quick overview of all invoices Customizable Management and User reports Centralized access to past invoices, contracts, W-9s, etc.III.IV.Enables companies to mitigate approval bottlenecks on manyfronts.Technology exists that empowers more productive supplierrelationships by facilitating communication:Checkpoints to Consider:Checkpoints to Consider: Tools to communicate - an interactive chat feed makes iteasy for approvers to ask questions and get the informationthey need to make informed approval decisions. Automated reminders - reminders automatically ping (orre-ping) someone when they have an invoice to approve. Paperless/Mobile functionality - this allows approvers toreview and approve invoices anywhere at any time and ontheir device of choice.9A supplier (vendor) portal reduces the communicationsoverhead by providing a separate online portal wherevendors can see the status of an invoice 24/7. This meansno back-and-forth emails or calls with vendors, simplifiedcommunications, and organized, centralized, and securevendor information.W H I T E PA P E R Treasury Webinars Stampli // www.stampli.com