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Equipment Installment Plans (Table)

9 Months Ended

Sep. 30, 2020

The following table summarizes equipment installment plan receivables as of September 30, 2020 and December 31, 2019.


	September 30, 2020		December 31, 2019
(Dollars in millions)
Equipment installment plan receivables, gross	$	951	$	1,008


Allowance for credit losses	(75)		(84)
Equipment installment plan receivables, net	$	876	$	924

Net balance presented in the Consolidated Balance Sheet as:
Accounts receivable — Customers and agents (Current portion)	$	568	$	587
Other assets and deferred charges (Non-current portion)	308		337
Equipment installment plan receivables, net	$	876	$	924

Equipment installment plan receivables credit categories

The balance and aging of the equipment installment plan receivables on a gross basis by credit category were as follows:


	September 30, 2020										December 31, 2019
	Lowest Risk		Lower Risk		Slight Risk		Higher Risk		Total		Lowest Risk		Lower Risk		Slight Risk		Higher Risk		Total
(Dollars in millions)
Unbilled	$	767	$	95	$	22	$	10	$	894	$	812	$	99	$	23	$	8	$	942
Billed — current	34		4		1		1		40		37		5		2		1		45
Billed — past due	8		5		2		2		17		11		6		3		1		21
Total	$	809	$	104	$	25	$	13	$	951	$	860	$	110	$	28	$	10	$	1,008

The balance of the equipment installment plan receivables as of September 30, 2020 on a gross basis by year of origination were as follows:


	2017		2018		2019		2020		Total
(Dollars in millions)
Lowest Risk	$	1	$	84	$	337	$	387	$	809
Lower Risk	—		7		39		58		104
Slight Risk	—		2		9		14		25
Higher Risk	—		—		4		9		13
Total	$	1	$	93	$	389	$	468	$	951

Equipment installment plans allowance for credit losses

Activity for the nine months ended September 30, 2020 and September 30, 2019, in the allowance for credit losses for equipment installment plan receivables was as follows:


	September 30, 2020		September 30, 2019
(Dollars in millions)
Allowance for credit losses, beginning of period	$	84	$	77
Bad debts expense	34		60
Write-offs, net of recoveries	(43)		(55)
Allowance for credit losses, end of period	$	75	$	82