Revenue Recognition And Accounts Receivable

3 Months Ended

Mar. 31, 2012

Revenue Recognition And Accounts Receivable [Abstract]

Revenue Recognition And Accounts Receivable

2. Revenue Recognition and Accounts Receivable

Mylan recognizes net revenue for product sales when title and risk of loss pass to its customers and when provisions for estimates, including discounts, sales allowances, price adjustments, returns, chargebacks and other promotional programs are reasonably determinable. Accounts receivable are presented net of allowances relating to these provisions. No revisions were made to the methodology used in determining these provisions during the three months ended March 31, 2012. Such allowances were $820.3 million and $763.0 million at March 31, 2012 and December 31, 2011. Other current liabilities include $155.0 million and $147.9 million at March 31, 2012 and December 31, 2011, for certain sales allowances and other adjustments that are paid to indirect customers.

In February 2012, Mylan Pharmaceuticals, Inc. ("MPI") entered into a receivable securitization facility (the "Receivables Facility") of up to $300.0 million. Pursuant to the terms of the Receivables Facility, MPI transfers certain of its domestic receivables, on an ongoing basis, to Mylan Securitization LLC ("Mylan Securitization"), a wholly-owned bankruptcy remote subsidiary. In turn, from time to time, Mylan Securitization sells its interests in such receivables, related assets and collections to certain conduit purchasers, committed purchasers and letter of credit issuers in exchange for cash or letters of credit. Mylan Securitization maintains a subordinated interest, in the form of over collateralization, in a portion of the receivables sold. Any amounts outstanding under the facility are recorded as a secured loan and included in short-term borrowings in the Condensed Consolidated Balance Sheets, and the receivables underlying any borrowings are included in accounts receivable, net.

The Company's accounts receivable and securitized accounts receivable include the following:

(In thousands)	March 31, 2012		December 31, 2011
Accounts receivable:
Retained trade accounts receivable	$	923,732	$	1,445,363
Securitized accounts receivable		635,534		—
Total accounts receivable		1,559,266		1,445,363
Less allowance for doubtful accounts		21,568		18,925
Accounts receivable, net	$	1,537,698	$	1,426,438

At March 31, 2012, there were $285.0 million of short-term borrowings outstanding under the Receivables Facility.

The Company utilizes proceeds from the sale of its accounts receivable as an alternative to other forms of debt, effectively reducing its overall borrowing costs. MPI has agreed to continue servicing the sold receivables for the financial institution at market rates.