Accounts Receivable Agreements

3 Months Ended

Dec. 31, 2020

Receivables [Abstract]

Accounts Receivable Agreements

Accounts Receivable Agreements

The Company’s Wireless segment has entered into various agreements, one agreement with recourse, to sell certain receivables to unrelated third-party financial institutions. For the agreement with recourse, the Company is responsible for collecting payments on the sold receivables from its customers. Under this agreement, the third-party financial institution advances the Company 90% of the sold receivables and establishes a reserve of 10% of the sold receivables until the Company collects the sold receivables. As the Company collects the sold receivables, the third-party financial institution will remit the remaining 10% to the Company. At December 31, 2020, the third-party financial institution has a reserve against the sold receivables of $0.3 million, which is reflected as restricted cash.  For the receivables sold under the agreement with recourse, the agreement addresses events and conditions which may obligate the Company to immediately repay the institution the outstanding purchase price of the receivables sold. The total amount of receivables uncollected by the institution was $2 million at December 31, 2020 for which there is a limit of $4.0 million. Although the sale of receivables is with recourse, the Company did not record a recourse obligation at December 31, 2020 as the Company concluded that the sold receivables are collectible. The other agreements without recourse are under programs offered by certain customers in the Wireless segment.

For the three months ended December 31, 2020 and 2019, the Company received proceeds from the sold receivables under all of the various agreements of $5.0 million and $7.0 million, respectively, and included the proceeds in net cash used in operating activities in the Consolidated Statements of Cash Flows. The fees associated with selling these receivables ranged from 1.0% to 2.3% of the gross receivables sold for the three months ended December 31, 2020 and 2019. The Company recorded costs of $43 thousand and $0.1 million for the three months ended December 31, 2020 and 2019, respectively, in other expense in the Consolidated Statements of Operations.