Finance Receivables, Net (Tables)

12 Months Ended

Dec. 31, 2014

Finance receivables, net were as follows:



	December 31,
	2014			2013
Gross receivables	$	5,009		$	5,349
Unearned income	(624		)	(666		)
Subtotal	4,385			4,683
Residual values	—			1
Allowance for doubtful accounts	(131		)	(154		)
Finance Receivables, Net	4,254			4,530
Less: Billed portion of finance receivables, net	110			113
Less: Current portion of finance receivables not billed, net	1,425			1,500
Finance Receivables Due After One Year, Net	$	2,719		$	2,917

Schedule of Financing Receivables, Minimum Payments

Contractual maturities of our gross finance receivables as of December 31, 2014 were as follows (including those already billed of $117):



2015		2016		2017		2018		2019		Thereafter		Total
$	1,883	$	1,382	$	958	$	558	$	205	$	23	$	5,009

Finance Receivables Sales Activity

The following is a summary of our prior sales activity:



	Year Ended December 31,
	2014		2013		2012
Net carrying value (NCV) sold	$	—	$	676	$	682
Allowance included in NCV	—		17		18
Cash proceeds received	—		635		630
Beneficial interests received	—		86		101
Pre-tax gain on sales	—		40		44
Net fees and expenses	—		5		5

Impact to Cash Flows from Sales of Finance Receivables

The net impact from the sales of finance receivables on operating cash flows is summarized below:



	Year Ended December 31,
	2014			2013			2012
Net cash received for sales of finance receivables⁽¹⁾	$	—		$	631		$	625
Impact from prior sales of finance receivables⁽²⁾	(527		)	(392		)	(45		)
Collections on beneficial interests	94			58			—
Estimated (Decrease) Increase to Operating Cash Flows	$	(433	)	$	297		$	580

____________


(1)	Net of beneficial interest, fees and expenses.


(2)	Represents cash that would have been collected if we had not sold finance receivables.

Allowance for Credit Losses Rollforward, and the Investment in Finance Receivables

The following table is a rollforward of the allowance for doubtful finance receivables as well as the related investment in finance receivables:



Allowance for Credit Losses:	United States			Canada			Europe			Other⁽³⁾			Total
Balance at December 31, 2012	$	50		$	31		$	85		$	4		$	170
Provision	13			11			53			4			81
Charge-offs	(8		)	(16		)	(60		)	(2		)	(86		)
Recoveries and other⁽¹⁾	2			1			3			—			6
Sale of finance receivables	(12		)	(5		)	—			—			(17		)
Balance at December 31, 2013	45			22			81			6			154
Provision	—			9			15			9			33
Charge-offs	(5		)	(14		)	(29		)	(3		)	(51		)
Recoveries and other⁽¹⁾	1			3			(9		)	—			(5		)
Balance at December 31, 2014	$	41		$	20		$	58		$	12		$	131
Finance Receivables Collectively Evaluated for Impairment:
December 31, 2013⁽²⁾	$	1,666		$	421		$	2,292		$	304		$	4,683
December 31, 2014⁽²⁾	$	1,728		$	424		$	1,835		$	398		$	4,385

__________


(1)	Includes the impacts of foreign currency translation and adjustments to reserves necessary to reflect events of non-payment such as customer accommodations and contract terminations.


(2)	Total Finance receivables exclude residual values of $0 and $1 and the allowance for credit losses of $131 and $154 at December 31, 2014 and 2013, respectively.


(3)	Includes developing market countries and smaller units.

Credit Quality Indicators for Finance Receivables

Details about our finance receivables portfolio based on industry and credit quality indicators are as follows:



	December 31, 2014								December 31, 2013
	Investment Grade		Non-investment Grade		Sub-standard		Total Finance Receivables		Investment Grade		Non-investment Grade		Sub-standard		Total Finance Receivables
Finance and other services	$	195	$	159	$	55	$	409	$	189	$	102	$	34	$	325
Government and education	589		13		3		605		656		12		3		671
Graphic arts	148		79		90		317		142		59		108		309
Industrial	92		41		18		151		92		28		15		135
Healthcare	84		26		14		124		74		25		16		115
Other	55		38		29		122		55		27		29		111
Total United States	1,163		356		209		1,728		1,208		253		205		1,666
Finance and other services	54		31		12		97		46		18		11		75
Government and education	76		8		2		86		96		9		1		106
Graphic arts	58		49		36		143		56		52		48		156
Industrial	24		13		4		41		23		12		6		41
Other	34		19		4		57		29		9		5		43
Total Canada⁽¹⁾	246		120		58		424		250		100		71		421
France	253		234		129		616		282		314		122		718
U.K/Ireland	255		101		6		362		199		171		42		412
Central⁽²⁾	230		278		30		538		287		394		43		724
Southern⁽³⁾	60		148		36		244		102		187		58		347
Nordic⁽⁴⁾	25		49		1		75		46		42		3		91
Total Europe	823		810		202		1,835		916		1,108		268		2,292
Other	195		163		40		398		226		69		9		304
Total	$	2,427	$	1,449	$	509	$	4,385	$	2,600	$	1,530	$	553	$	4,683

__________

(1)

Historically, the Company had included certain Canadian customers with graphic arts activity in their industry sector. In 2014, these customers were reclassified to Graphic Arts to better reflect their primary business activity. The December 31, 2013 amounts have been revised to reclassify $33 from Finance and Other Services and $38 from Industrial to Graphic Arts to be consistent with the 2014 presentation.


(2)	Switzerland, Germany, Austria, Belgium and Holland.


(3)	Italy, Greece, Spain and Portugal.


(4)	Sweden, Norway, Denmark and Finland.

Aging of Billed Finance Receivables

The aging of our billed finance receivables is as follows:



	December 31, 2014
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	7	$	2	$	1	$	10	$	399	$	409	$	13
Government and education	14		4		3		21		584		605		25
Graphic arts	12		1		1		14		303		317		6
Industrial	4		1		1		6		145		151		9
Healthcare	3		1		—		4		120		124		5
Other	3		1		—		4		118		122		6
Total United States	43		10		6		59		1,669		1,728		64
Canada	9		2		1		12		412		424		17
France	—		1		2		3		613		616		35
U.K./Ireland	1		—		—		1		361		362		1
Central⁽¹⁾	2		2		1		5		533		538		15
Southern⁽²⁾	14		4		4		22		222		244		17
Nordic⁽³⁾	1		—		—		1		74		75		2
Total Europe	18		7		7		32		1,803		1,835		70
Other	13		1		—		14		384		398		—
Total	$	83	$	20	$	14	$	117	$	4,268	$	4,385	$	151



	December 31, 2013
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	7	$	2	$	1	$	10	$	315	$	325	$	12
Government and education	17		4		3		24		647		671		34
Graphic arts	12		1		—		13		296		309		5
Industrial	3		1		1		5		130		135		6
Healthcare	3		1		—		4		111		115		5
Other	3		1		—		4		107		111		3
Total United States	45		10		5		60		1,606		1,666		65
Canada	4		3		3		10		411		421		19
France	—		—		—		—		718		718		40
U.K./Ireland	1		1		—		2		410		412		2
Central⁽¹⁾	3		2		3		8		716		724		23
Southern⁽²⁾	21		5		7		33		314		347		45
Nordic⁽³⁾	2		—		—		2		89		91		—
Total Europe	27		8		10		45		2,247		2,292		110
Other	8		1		—		9		295		304		—
Total	$	84	$	22	$	18	$	124	$	4,559	$	4,683	$	194

___________


(1)	Switzerland, Germany, Austria, Belgium and Holland.


(2)	Italy, Greece, Spain and Portugal.


(3)	Sweden, Norway, Denmark and Finland.