1. Ask, Share, Learn Within the Largest Community of Corporate Finance ProfessionalsGetting Paid: 5 Steps toImproving Collections & CashFlow

2. Welcome to ProformativeProformative is the leading educational resource for corporate financeprofessionals.Announcing the new Proformative Academy: On demand video courses taught by peers and SMEs Over 125 finance and accounting courses and growing rapidly CPE for CPAs, CMAs, CTPs, and CIAsCheck it out at www.ProformativeAcademy.com 3. Ask, Share, Learn Within the Largest Community of Corporate Finance ProfessionalsGetting Paid: 5 Steps to ImprovingCollections & Cash FlowScott Pezza, Principal Analyst, Blue Hill Research 4. Context: Top Objectives Improve Cash Management Reduce Days Sales Outstanding (DSO) Reduce Time Required to Process Receivables Reduce Customer Inquiries Increase Usage of Electronic InvoicingSources: Blue Hill Research AR Trends Pulse Survey (2014), Institute of Financial Operations AR Automation Studies (2013, 2014)) 5. Context: Top Challenges Impact of Customer Default or Missed/Late Payments Desire to Reduce or Control Labor Costs Customer Reluctance to Use Electronic Invoicing Lack of Collaboration Between Functional Areas Customer Attempts to Extend Payment TermsSources: Blue Hill Research AR Trends Pulse Survey (2014), Institute of Financial Operations AR Automation Studies (2013, 2014)) 6. 3.29 3.283.63.023.223.6154321Credit review Sales ordermanagementCustomer billingand invoicingCollections Dispute resolution Cash applicationO2C Self-AssessmentSources: Blue Hill Research AR Trends Pulse Survey (2014)Ability to Handle (1 = Poor, 5 = Very Well) 7. O2C Automation Profile44%59%48%61%55% 59%10%27% 45%10%0%21%100%90%80%70%60%50%40%30%20%10%0%Credit review Sales ordermanagementCustomer billingand invoicingCollections DisputeresolutionCash applicationPartially Automated Fully Automated 8. Customer Interaction: Billing & PaymentsOutgoing Invoices41%59%PaperElectronicIncoming Payments43%57%53%of Customer BaseAccepts eInvoices54%of Customer BaseUses ePaymentsSources: Blue Hill Research AR Trends Pulse Survey (2014) 9. Research Wrap-Up Sellers want to Improve process efficiency Speed up customer payment Buyers want to Improve process efficiency (common ground) Extend payment terms Technology is currently Addressing the low hanging fruit with electronic invoicing andpayment Helping to automate (at least partially) O2C processes in manyfirms 10. Working Towards Solutions Start with the problems: slow payments and high DSO Work backwards to understand the reasons: Inefficient customer AP processes Inaccurate information from our billing/invoicing Customer scale and negotiating leverage Customer financial distress Identify strategies to avoid or address those difficultiesWhen looking for answers, everything is on the table: credit, sales,billing, collections, and dispute resolution 11. Step 1: Make Informed Sales Problem: Customer default or inability to pay can have alarge impact on sellers Source: Selling to unfit buyers or not using appropriateterms to minimize repayment risk Solution: Enable information exchange between credit, sales, andcollections to ensure future sales are informed by past paymentperformance While you may not want to forego a sale outright, adjust terms to(1) require full or partial payment in advance, (2) reduce the netterm, (3) offer discount-based incentives for early payment, or (4)impose penalties for late payments. 12. Getting Paid: 5 Steps to Improving Collections& Cash FlowThank you for your interest in this presentation.View the on-demand webinar or download the fullpresentation at:www.Proformative.com