Revenues

12 Months Ended

Sep. 30, 2022

Revenue from Contract with Customer [Abstract]

Revenues

Revenues

Measurement of Revenues

Payment terms extended to the Company’s customers are based upon commercially reasonable terms for the markets in which the Company’s products are sold. Because the Company generally expects to receive payment within one year or less from when control of a product is transferred to the customer, the Company does not generally adjust its revenues for the effects of a financing component. The Company’s allowance for doubtful accounts reflects the current estimate of credit losses expected to be incurred over the life of its trade receivables. Such estimated credit losses are determined based on historical loss experiences, customer specific credit risk, and reasonable and supportable forward-looking information, such as country or regional risks that are not captured in the historical loss information. Amounts are written off against the allowances for doubtful accounts when the Company determines that a customer account is uncollectible. The allowance for doubtful accounts for trade receivables is not material to the Company’s consolidated financial results.

The Company’s gross revenues are subject to a variety of deductions which are recorded in the same period that the underlying revenues are recognized. Such variable consideration includes rebates, sales discounts, and sales returns. Because these deductions represent estimates of the related obligations, judgment is required when determining the impact of these revenue deductions on gross revenues for a reporting period. Rebates provided by the Company are based upon prices determined under the Company’s agreements primarily with its end-user customers. Additional factors considered in the estimate of the Company’s rebate liability include the quantification of inventory that is either in stock at or in transit to the Company’s distributors, as well as the estimated lag time between the sale of product and the payment of corresponding rebates.

The Company’s liability attributed to variable consideration at September 30, 2022 and September 30, 2021 was $43.8 million and $71.7 million, respectively. The decrease is primarily attributed to the Factoring Agreements by which certain trade receivables are factored to BD net of variable consideration. Sales deductions recorded as a reduction of gross revenues for the years ended September 30, 2022, 2021 and 2020 were $336.4 million, $298.7 million, and $300.7 million respectively.

Disaggregation of Revenues

Disaggregation of revenue by geographic region is provided within Note 8.

Contract Assets and Liabilities

The Company does not have contract liabilities. Contract assets consist of the Company’s right to consideration that is conditional upon its future performance pursuant to private label agreements and are presented within Prepaid expenses and other in the Consolidated Balance Sheets.

The Company’s contract asset balance was $1.2 million and $1.4 million as of September 30, 2022 and 2021, respectively.