Receivables, Loans, Notes Receivable, and Others

12 Months Ended

Dec. 31, 2020

Loans, Notes, Trade and Other Receivables Disclosure

ACCOUNTS RECEIVABLE, NET

Accounts receivable, net consisted of the following:


(dollars in millions)	2020		2019
U.S. government contracts (including foreign military sales)	$	1,039	$	551
Other customers	8,761		8,446
Allowance for expected credit losses	(546)		(254)
Total accounts receivable, net	$	9,254	$	8,743

The Company enters into various factoring agreements with third-party financial institutions to sell certain of its receivables. Under these arrangements, the Company factored receivables of $6.4 billion and $7.8 billion in 2020 and 2019, respectively. The cash received from these arrangements is reflected as cash provided by operating activities in the 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 December 31, 2020 and 2019, the Company had $10 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 Consolidated Statement of Cash Flows.

The changes in the allowance for expected credit losses related to Accounts receivable were as follows:


(dollars in millions)	2020
Balance as of December 31, 2019	$	254
Current period provision for expected credit losses(1)	277
Write-offs charged against the allowance for expected credit losses	(5)
Other, net(2)	20
Balance as of December 31, 2020	$	546

(1) The current provision for expected credit losses for 2020 includes $248 million of reserves driven by customer bankruptcies and additional 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 January 1, 2020 adoption of ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments.

The activity in the allowance for doubtful accounts was not material in 2019 or 2018.