Revenues and Allowances

9 Months Ended

Sep. 30, 2023

Revenue from Contract with Customer [Abstract]

Revenues and Allowances

Revenues and Allowances

The contracts CRA enters into and operates under specify whether the projects are billed on a time-and-materials or a fixed-price basis. Time-and-materials contracts are typically used for litigation, regulatory, and financial consulting projects while fixed-price contracts are principally used for management consulting projects. In general, project costs are classified in costs of services, exclusive of depreciation and amortization, and are based on the direct salary of CRA’s employee consultants on the engagement, plus all direct expenses incurred to complete the project, including any amounts billed to CRA by its non-employee experts.

Disaggregation of Revenue

The following tables disaggregate CRA’s revenue by type of contract and geographic location (in thousands):

	Fiscal Quarter Ended				Fiscal Year-to-Date Period Ended
Type of Contract	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
Consulting services revenues:
Fixed-price	$	26,783	$	24,201	$	81,642	$	80,515
Time-and-materials	120,770		124,240		380,721		365,410
Total	$	147,553	$	148,441	$	462,363	$	445,925

	Fiscal Quarter Ended				Fiscal Year-to-Date Period Ended
Geographic Breakdown	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
Consulting services revenues:
United States	$	117,420	$	121,496	$	362,186	$	358,583
United Kingdom	21,227		20,069		73,272		63,322
Other	8,906		6,876		26,905		24,020
Total	$	147,553	$	148,441	$	462,363	$	445,925

Reserves for Variable Consideration and Credit Risk

Revenues from CRA's consulting services are recorded at the net transaction price, which includes estimates of variable consideration for which reserves are established. Variable consideration reserves are based on specific price concessions and those expected to be extended to CRA customers estimated by CRA's historical realization rates. Reserves for variable consideration are recorded as a component of the allowances for accounts receivable and unbilled services on the condensed consolidated balance sheets. Adjustments to the reserves for variable consideration are included in revenues on the condensed consolidated statements of operations.

CRA also maintains allowances for accounts receivable and unbilled services for estimated losses resulting from clients’ failure to make required payments. The following table presents CRA's bad debt expense, net of recoveries of previously written off allowances (in thousands):

	Fiscal Quarter Ended				Fiscal Year-to-Date Period Ended
	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
Bad debt expense (recovery), net	$	131	$	(83)	$	523	$	(345)

Reimbursable Expenses

Revenues also include reimbursements for costs incurred by CRA in fulfilling its performance obligations, including travel and other out-of-pocket expenses, fees for outside consultants, and other reimbursable expenses. CRA recovers substantially all of these costs. The following expenses are subject to reimbursement (in thousands):

	Fiscal Quarter Ended				Fiscal Year-to-Date Period Ended
	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
Reimbursable expenses	$	17,932	$	15,009	$	49,165	$	47,654

Contract Balances from Contracts with Customers

CRA defines contract assets as assets for which it has recorded revenue because it determines that it is probable that it will earn a performance-based or contingent fee, but is not yet entitled to receive a fee because certain events, such as completion of the measurement period or client approval, must occur. The contract assets balance was immaterial as of September 30, 2023 and December 31, 2022.

When consideration is received, or such consideration is unconditionally due from a customer prior to transferring consulting services to the customer under the terms of a contract, a contract liability is recorded. Contract liabilities are recognized as revenue after performance obligations have been satisfied and all revenue recognition criteria have been met. The following table presents the closing balances of CRA's contract liabilities (in thousands):

	September 30, 2023		December 31, 2022
Contract liabilities	$	2,197	$	6,977

CRA recognized the following revenue that was included in the contract liabilities balance as of the opening of the respective period or for performance obligations satisfied in previous periods (in thousands):

	Fiscal Quarter Ended				Fiscal Year-to-Date Period Ended
	September 30, 2023		October 1, 2022		September 30, 2023		October 1, 2022
Amounts included in contract liabilities at the beginning of the period	$	2,580	$	1,831	$	6,619	$	8,101
Performance obligations satisfied in previous periods	$	3,658	$	3,495	$	2,816	$	2,193