ACCOUNTS RECEIVABLE AND ALLOWANCE FOR DOUBTFUL ACCOUNTS:

Accounts receivable are recorded at the invoiced amount and generally do not bear interest. The allowance for doubtful accounts is the Company's best estimate of the amount of probable credit losses on existing accounts receivable. Management determines the allowance based on historical write-off experience within each of the Company's regions. Management reviews material past due balances on a monthly basis. Account balances are charged off against the allowance when management determines it is probable that the receivable will not be recovered.

Accounts receivable consisted of the following at December 31, 2015 and 2014 (dollars in thousands):



	2015			2014
Accounts receivable - trade	$	339,100		$	304,087
Accounts receivable - grants from outside parties	22,997			32,076
Accounts receivable - insurance and other third-party claims	26,574			26,941
Total accounts receivable	388,671			363,104
Allowance for doubtful accounts	(6,213		)	(5,826		)
Accounts receivable, net	$	382,458		$	357,278

Included in accounts receivable, net as of December 31, 2015 was $95.5 million (or £64.8 million) of Freightliner's accounts receivable, based on the exchange rate at December 31, 2015.

Grants from Outside Parties

The Company periodically receives grants for the upgrade and construction of rail lines and upgrades of locomotives from federal, provincial, state and local agencies in the United States and provinces in Canada in which the Company operates. These grants typically reimburse the Company for 50% to 100% of the actual cost of specific projects. In total, the Company received grant proceeds of $41.7 million, $28.0 million and $33.9 million for the years ended December 31, 2015, 2014 and 2013, respectively, from such grant programs. The proceeds were presented as cash inflows from investing activities within each of the applicable periods.

None of the Company's grants represents a future liability of the Company unless the Company abandons the rehabilitated or new track structure within a specified period of time or fails to maintain the upgraded or new track to certain standards, fails to make certain minimum capital improvements or ceases use of the locomotives within the specified geographic area and time period, in each case, as defined in the applicable grant agreement. As the Company intends to comply with the requirements of these agreements, the Company has recorded additions to track property and locomotives and has deferred the amount of the grants. The amortization of deferred grants is a non-cash offset to depreciation expense over the useful lives of the related assets.

The following table sets forth the offset to depreciation expense from the amortization of deferred grants recorded by the Company during the years ended December 31, 2015, 2014 and 2013 (dollars in thousands):



	2015	2014	2013
Amortization of deferred grants	10,691	10,364	9,343

Insurance and Third-Party Claims

Accounts receivable from insurance and other third-party claims at December 31, 2015 included $12.8 million from the Company's North American Operations, $8.1 million from the Company's Australian Operations and $5.7 million from the Company's U.K./European Operations. The balance from the Company's North American Operations resulted predominately from the Company's anticipated insurance recoveries associated with a derailment in Alabama (the Aliceville Derailment) in November 2013 and a trestle fire in Oregon in August 2015. The majority of the balance from the Company's Australian Operations resulted from the Company's anticipated insurance recoveries associated with derailments in Australia in 2012. The balance from the Company's U.K./European Operations resulted primarily from the Company's anticipated insurance recoveries associated with a rail-related collision in Germany in 2014 that occurred prior to the Company's acquisition of Freightliner. The Company received proceeds from insurance totaling $10.4 million, $13.6 million and $11.1 million for the years ended December 31, 2015, 2014 and 2013, respectively.

Allowance for Doubtful Accounts

Activity in the Company's allowance for doubtful accounts for the years ended December 31, 2015, 2014 and 2013 was as follows (dollars in thousands):



	2015			2014			2013
Balance, beginning of year	$	5,826		$	3,755		$	2,693
Provisions	7,512			5,191			2,741
Charges	(7,125		)	(3,120		)	(1,679		)
Balance, end of year	$	6,213		$	5,826		$	3,755

The Company's business is subject to credit risk. There is a risk that a customer or counterparty will fail to meet its obligations when due. Customers and counterparties who owe the Company money have defaulted and may continue to default on their obligations to the Company due to bankruptcy, lack of liquidity, operational failure or other reasons. For interline traffic, one railroad typically invoices a customer on behalf of all railroads participating in the route. The invoicing railroad then pays the other railroads their portion of the total amount invoiced on a monthly basis. When the Company is the invoicing railroad, it is exposed to customer credit risk for the total amount invoiced and is required to pay the other railroads participating in the route even if the Company is not paid by the customer. Although the Company has procedures for reviewing its receivables and credit exposures to specific customers and counterparties to address present credit concerns, default risk may arise from events or circumstances that are difficult to detect or foresee. Some of the Company's risk management methods depend upon the evaluation of information regarding markets, customers or other matters that are not publicly available or otherwise accessible by the Company and this information may not, in all cases, be accurate, complete, up-to-date or properly evaluated. As a result, unexpected credit exposures could adversely affect the Company's consolidated results of operations, financial condition and liquidity.