Receivables, Loans, Notes Receivable, and Others

6 Months Ended

Jun. 30, 2020

Loans, Notes, Trade and Other Receivables Disclosure

Accounts Receivable, Net

Accounts receivable, net consisted of the following:


(dollars in millions)	June 30, 2020		December 31, 2019
Accounts receivable	$	9,990	$	8,997
Allowance for expected credit losses	(494)		(254)
Total accounts receivable, net	$	9,496	$	8,743

The Company enters into various factoring agreements with third-party financial institutions to sell certain of its receivables. Under these factoring arrangements, the Company factored receivables of $3.8 billion and $3.5 billion during the six months ended June 30, 2020 and 2019, respectively. The cash received from these arrangements is reflected as cash provided by operating activities in the Condensed Consolidated Statement of Cash Flows. In certain of these factoring arrangements, for ease of administration, the Company will collect customer payments related to the factored receivables, which it then remits to the financial institutions. At June 30, 2020 and December 31, 2019, the Company had $11 million and $7 million, respectively, that was collected on behalf of the financial institutions and recorded as restricted cash and accrued liabilities. The net cash flows relating to these collections are reported as financing activities in the Condensed Consolidated Statement of Cash Flows.

The changes in the allowance for expected credit losses related to Accounts receivable for the six months ended June 30, 2020 were as follows:


(dollars in millions)
Balance as of December 31, 2019	$	254
Current period provision for expected credit losses⁽¹⁾	225
Write-offs charged against the allowance for expected credit losses	(3)
Other⁽²⁾	18
Balance as of June 30, 2020	$	494

(1) The current provision for expected credit losses for the six months ended June 30, 2020 includes $194 million of reserves driven by customer bankruptcies and additional general reserves for credit losses primarily due to the current economic environment primarily caused by the COVID-19 pandemic.

(2) Other includes $34 million of impact related to the adoption of Accounting Standard Update (ASU) 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.