EXPECTED CREDIT LOSSES

6 Months Ended

Jun. 30, 2022

EXPECTED CREDIT LOSSES [Abstract]

EXPECTED CREDIT LOSSES

3. EXPECTED CREDIT LOSSES

The Company is exposed to credit losses primarily through trade and other financing receivables arising from revenue transactions. The Company uses the aging schedule method to estimate current expected credit losses (“CECL”) based on days of delinquency, including information about past events and current economic conditions. The Company’s accounts receivable is separated into three categories to evaluate allowance under the CECL impairment model. The receivables in each category share similar risk characteristics. The three categories include agent non-commission based fees, agent short-term advances, and commissions receivable for real estate property settlements. As of the first quarter of 2022, the Company provided an allowance for potential credit losses of real estate transactions.

The Company analyzed uncollectible accounts for the three categories of receivables. Receivables from real estate property settlements totaled $147,824 and $128,499 of which the Company recognized expected credit losses of $904 and nil, respectively as of June 30, 2022 and December 31, 2021. As of June 30, 2022 and December 31, 2021 agent non-commission based fees receivable and short-term advances totaled $9,979 and $7,188, of which the Company recognized expected credit losses of $1,902 and $2,198, respectively.

The Company increases the allowance for expected credits losses when the Company determines all or a portion of a receivable is uncollectable. The Company recognizes recoveries as a decrease to the allowance for expected credit losses.

Changes in the allowance were not material for the six months ended June 30, 2022 and the year ended December 31, 2021.