Accounts Receivable Factoring

12 Months Ended

Dec. 31, 2019

Transfers and Servicing [Abstract]

Accounts Receivable Factoring

Accounts Receivable Factoring

In 2018, the Company entered into a Receivables Factoring arrangement, pursuant to which certain receivables originated from the EMEA region are sold to a bank in exchange for cash. In the third quarter of 2019, the Company entered into an additional Receivables Factoring arrangement, which provides for additional sales of EMEA-originated receivables to a bank under similar terms. Under these Receivables Factoring arrangements, the Company does not maintain any beneficial interest in the receivables sold. The banks’ purchase of eligible receivables is subject to a maximum of $125 million of uncollected receivables. The Company services the receivables on behalf of the banks, but otherwise maintains no significant continuing involvement with respect to the receivables. Transactions under the Receivables Factoring arrangements are accounted for as sales under ASC 860 with related cash flows reflected in operating cash flows. As of December 31, 2019 and December 31, 2018 there were $60 million and $33 million, respectively, of uncollected receivables that had been sold and removed from the Company’s Consolidated Balance Sheets.

In its capacity as servicer of factored receivables, the Company had $33 million of cash collections that were not yet remitted to the banks as of December 31, 2019 due to the timing of collection processing activities. These amounts, whose use is not legally restricted, are included within Accrued liabilities on the Consolidated Balance Sheets and reflected within financing activities on the Consolidated Statements of Cash Flows. No liability existed as of December 31, 2018. Changes in such unremitted cash collection liabilities are reflected within financing cash flows.

Fees incurred in connection with these arrangements were not significant.