Finance Receivables, Net (Tables)

9 Months Ended

Sep. 30, 2019

Receivables [Abstract]

Finance Receivables

Finance receivables, net were as follows:

	September 30, 2019			December 31, 2018
Gross receivables	$	3,795		$	4,003
Unearned income	(414		)	(439		)
Subtotal	3,381			3,564
Residual values	—			—
Allowance for doubtful accounts	(93		)	(92		)
Finance receivables, net	3,288			3,472
Less: Billed portion of finance receivables, net	106			105
Less: Current portion of finance receivables not billed, net	1,145			1,218
Finance receivables due after one year, net	$	2,037		$	2,149

Schedule of Financing Receivables, Minimum Payments

A summary of future contractual maturities of our gross finance receivables, including those previously billed is as follows:

	September 30, 2019		December 31, 2018
12 Months(1)	$	1,471	$	1,543
24 Months	1,044		1,108
36 Months	705		755
48 Months	406		425
60 Months	152		158
Thereafter	17		14
Total	$	3,795	$	4,003

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(1)

Includes amounts previously billed of $108 and $107 as of September 30, 2019 and December 31, 2018, respectively.

Allowance for Credit Losses on Financing Receivables

The allowance for doubtful finance receivables as well as the related investment in finance receivables were as follows:

Allowance for Credit Losses:	United States			Canada			Europe			Other(1)		Total
Balance at December 31, 2018	$	53		$	12		$	25		$	2	$	92
Provision	4			1			4			—		9
Charge-offs	(4		)	(1		)	(3		)	—		(8		)
Recoveries and other(2)	—			—			—			—		—
Balance at March 31, 2019	$	53		$	12		$	26		$	2	$	93
Provision	4			1			3			—		8
Charge-offs	(5		)	(3		)	(3		)	—		(11		)
Recoveries and other(2)	1			2			—			—		3
Balance at June 30, 2019	$	53		$	12		$	26		$	2	$	93
Provision	6			—			2			—		8
Charge-offs	(5		)	(1		)	(3		)	—		(9		)
Recoveries and other(2)	1			—			—			—		1
Balance at September 30, 2019	$	55		$	11		$	25		$	2	$	93
Finance receivables as of September 30, 2019 collectively evaluated for impairment (3)	$	1,900		$	318		$	1,120		$	43	$	3,381
Balance at December 31, 2017	$	56		$	15		$	35		$	2	$	108
Provision	5			—			4			—		9
Charge-offs	(5		)	(1		)	(4		)	—		(10		)
Recoveries and other(2)	—			—			1			—		1
Balance at March 31, 2018	$	56		$	14		$	36		$	2	$	108
Provision	4			1			4			—		9
Charge-offs	(4		)	(1		)	(3		)	—		(8		)
Recoveries and other(2)	—			—			(2		)	—		(2		)
Balance at June 30, 2018	$	56		$	14		$	35		$	2	$	107
Provision	2			—			4			—		6
Charge-offs	(2		)	(2		)	(4		)	—		(8		)
Recoveries and other(2)	1			1			—			—		2
Balance at September 30, 2018	$	57		$	13		$	35		$	2	$	107
Finance receivables as of September 30, 2018 collectively evaluated for impairment(3)(4)	$	1,960		$	352		$	1,242		$	47	$	3,601

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(1) Includes developing market countries and smaller units.

(2) 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.

(3) Total Finance receivables exclude the allowance for credit losses of $93 and $107 at September 30, 2019 and 2018, respectively.

(4) As a result of an internal reorganization, XBS amounts, previously classified as Other, were reclassified to the U.S. in first quarter 2019. Prior year amounts have also been reclassified to conform to the current year presentation.

Financing Receivable Credit Quality Indicators

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

	September 30, 2019								December 31, 2018
	Investment Grade		Non-investment Grade		Substandard		Total Finance Receivables		Investment Grade		Non-investment Grade		Substandard		Total Finance Receivables
Finance and other services	$	166	$	332	$	87	$	585	$	177	$	334	$	88	$	599
Government and education	440		54		16		510		453		63		9		525
Graphic arts	70		140		81		291		82		131		87		300
Industrial	79		85		16		180		86		82		16		184
Healthcare	61		63		12		136		86		48		9		143
Other	62		107		29		198		63		90		42		195
Total United States(1)	878		781		241		1,900		947		748		251		1,946
Finance and other services	59		30		17		106		52		33		20		105
Government and education	35		4		3		42		38		3		4		45
Graphic arts	19		26		27		72		22		30		26		78
Industrial	18		11		11		40		16		12		9		37
Other	29		18		11		58		34		21		15		70
Total Canada	160		89		69		318		162		99		74		335
France	199		141		20		360		232		157		29		418
U.K./Ireland	142		78		6		226		150		87		7		244
Central(2)	169		117		8		294		196		123		8		327
Southern(3)	57		129		10		196		52		136		17		205
Nordics(4)	25		18		1		44		28		15		2		45
Total Europe(5)	592		483		45		1,120		658		518		63		1,239
Other(1)	28		13		2		43		31		13		—		44
Total	$	1,658	$	1,366	$	357	$	3,381	$	1,798	$	1,378	$	388	$	3,564

_____________________________

(1) As a result of an internal reorganization, XBS amounts, previously classified as Other, were reclassified to the U.S. in first quarter 2019. Prior year amounts have also been reclassified to conform to the current year presentation.

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

(3) Italy, Greece, Spain and Portugal.

(4) Sweden, Norway, Denmark and Finland.

(5)

Prior year amounts have been recasted to conform to the current year presentation.

Finance Receivables Aging

The aging of our billed finance receivables is based upon the number of days an invoice is past due and is as follows:

	September 30, 2019
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	15	$	4	$	3	$	22	$	563	$	585	$	15
Government and education	17		3		3		23		487		510		19
Graphic arts	13		1		1		15		276		291		6
Industrial	6		2		1		9		171		180		9
Healthcare	4		2		1		7		129		136		6
Other	6		1		1		8		190		198		4
Total United States	61		13		10		84		1,816		1,900		59
Canada	6		2		2		10		308		318		19
France	4		—		—		4		356		360		25
U.K./Ireland	1		—		—		1		225		226		—
Central(2)	1		—		1		2		292		294		8
Southern(3)	2		1		1		4		192		196		3
Nordics(4)	—		—		—		—		44		44		—
Total Europe	8		1		2		11		1,109		1,120		36
Other	3		—		—		3		40		43		—
Total	$	78	$	16	$	14	$	108	$	3,273	$	3,381	$	114
	December 31, 2018
	Current		31-90 Days Past Due		>90 Days Past Due		Total Billed		Unbilled		Total Finance Receivables		>90 Days and Accruing
Finance and other services	$	15	$	4	$	2	$	21	$	578	$	599	$	11
Government and education	17		4		3		24		501		525		24
Graphic arts	10		1		1		12		288		300		5
Industrial	5		2		1		8		176		184		5
Healthcare	4		2		1		7		136		143		5
Other	5		2		1		8		187		195		4
Total United States(1)	56		15		9		80		1,866		1,946		54
Canada	7		2		1		10		325		335		22
France	5		—		—		5		413		418		14
U.K./Ireland	2		—		—		2		242		244		—
Central(2)	1		1		1		3		324		327		6
Southern(3)	3		1		1		5		200		205		6
Nordics(4)	—		—		—		—		45		45		—
Total Europe	11		2		2		15		1,224		1,239		26
Other(1)	2		—		—		2		42		44		—
Total	$	76	$	19	$	12	$	107	$	3,457	$	3,564	$	102

 _____________________________

(1) As a result of an internal reorganization, XBS amounts, previously classified as Other, were reclassified to the U.S. in first quarter 2019. Prior year amounts have also been reclassified to conform to the current year presentation.

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

(3)Italy, Greece, Spain and Portugal.

(4)Sweden, Norway, Denmark and Finland.