ACCOUNTS RECEIVABLE AND OTHER FINANCIAL ASSETS

6 Months Ended

Jun. 30, 2023

ACCOUNTS RECEIVABLE AND OTHER FINANCIAL ASSETS

Accounts receivable in the Consolidated Balance Sheets at June 30, 2023 and December 31, 2022 includes receivables from customers of $2.0 billion and $1.5 billion, respectively, and receivables from payment processors and networks of $832 million and $730 million, respectively. The remaining balance principally relates to receivables from marketing affiliates. In addition, the Company had prepayments to certain accommodation travel service provider customers of $6 million and $29 million included in "Prepaid expenses, net" and $22 million and $5 million included in "Other assets, net" in the Consolidated Balance Sheets at June 30, 2023 and December 31, 2022, respectively. The amounts mentioned above are stated on a gross basis, before deducting the allowance for expected credit losses.

Significant judgments and assumptions are required to estimate the allowance for expected credit losses and such assumptions may change in future periods, particularly the assumptions related to the business prospects and financial condition of customers and marketing affiliates, also taking into account factors such as the macroeconomic conditions, inflationary pressures, potential recession, and the Company's ability to collect the receivable or recover the prepayment.

The following table summarizes the activity of the allowance for expected credit losses on receivables (in millions):


	Six Months Ended June 30,
	2023		2022
Balance, beginning of year	$	117	$	101
Provision charged to earnings	60		59
Write-offs and adjustments	(92)		(52)
Foreign currency translation adjustments	2		(6)
Balance, end of period	$	87	$	102

In addition to the allowance for expected credit losses on receivables, the Company recorded an allowance for expected credit losses on prepayments to certain accommodation travel service provider customers, which are included in "Prepaid expenses, net" and "Other assets, net" in the Consolidated Balance Sheets. The following table summarizes the activity of the allowance for expected credit losses on prepayments to customers (in millions):


	Six Months Ended June 30,
	2023		2022
Balance, beginning of year	$	23	$	47
Provision charged to expense	2		(8)
Write-offs and adjustments	(2)		(4)

Balance, end of period	$	23	$	35