Accounts Receivable Factoring

3 Months Ended

Mar. 28, 2020

Transfers and Servicing [Abstract]

Accounts Receivable Factoring

Accounts Receivable Factoring

The Company has entered into multiple Receivables Factoring arrangements, pursuant to which certain receivables are sold to banks in exchange for cash. 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 amount 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 Topic 860, Transfers and Servicing of Financial Assets with related cash flows reflected in Net cash provided by operating activities on the Consolidated Statements of Cash Flows. The Company’s Receivable Factoring arrangements allow for the factoring of up to $125 million of uncollected receivables originated from the EMEA region.

As of March 28, 2020 and December 31, 2019, there were a total of $80 million and $60 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 $11 million and $33 million of cash collections that were not yet remitted to banks as of March 28, 2020 and December 31, 2019, respectively. These amounts, whose use is not legally restricted, are included within Accrued liabilities on the Consolidated Balance Sheets. Changes in such unremitted cash collection liabilities are reflected within Net cash (used in) provided by financing activities on the Consolidated Statements of Cash Flows.

Fees incurred in connection with these arrangements were not significant.