Revenue Recognition (Tables)

9 Months Ended

Sep. 30, 2021

Schedule of reconciliation of contract balances


(Dollars in millions)	At September 30, 2021		At December 31, 2020
Accounts receivable (net of allowances of $58 in 2021 and $91 in 2020)	$	1,746	$	1,444
Contract assets *		80		72
Deferred income (current)		875		854
Deferred income (noncurrent)		520		543

*	Included within prepaid expenses and other current assets in the Combined Balance Sheet.

Schedule of notes and accounts receivable - trade allowance for credit losses


	Nine Months Ended		Year Ended
(Dollars in millions)	September 30, 2021		December 31, 2020
Beginning balance	$	91	$	82
Additions (releases)		(27)		25
Write-offs		(5)		(7)
Other *		(1)		(9)
Ending balance	$	58	$	91

*	Primarily represents translation adjustments and reclassifications.

Schedule of capitalized costs to acquire and fulfill customer


	At September 30,		At December 31,
(Dollars in millions)	2021		2020
Capitalized costs to obtain a contract	$	285	$	269
Deferred costs to fulfill a contract
Deferred transition and setup costs		1,195		1,369
Other deferred fulfillment costs *		1,016		1,006
Total deferred costs **	$	2,496	$	2,646

*	Includes related party cost of $78 million at September 30, 2021 and $94 million at December 31, 2020.

Of the total deferred costs, $1,142 million was current (related party $66 million) and $1,354 million was noncurrent (related party $12 million) at September 30, 2021, and $1,205 million was current (related party $76 million) and $1,441 million was noncurrent (related party $18 million) at December 31, 2020.