Accounts Receivable, Net and Contract Assets and Liabilities

3 Months Ended

Mar. 31, 2018

Receivables [Abstract]

Accounts Receivable, Net and Contract Assets and Liabilities

Note 5 - Accounts Receivable, Net, and Contract Assets and Liabilities

The following table provides details of accounts receivable, net of allowance, contract assets (together, “accounts receivable, net”) and contract liabilities as of the dates indicated (in millions):

	March 31, 2018			December 31, 2017
Contract billings	$	679.4		$	683.9
Less allowance for doubtful accounts	(9.0		)	(8.2		)
Accounts receivable, net of allowance	$	670.4		$	675.7
Retainage	301.9			323.1
Costs and earnings in excess of billings	732.8			599.2
Retainage and costs and earnings in excess of billings (together, “contract assets”)	$	1,034.7		$	922.3
Accounts receivable, net	$	1,705.1		$	1,598.0
Billings in excess of costs and earnings	215.7			194.5
Accrued project losses	6.7			11.6
Contract liabilities	$	222.4		$	206.1

Contract assets consist of costs and earnings in excess of billings (“CIEB”) and retainage. CIEB, which is also referred to as work in process, represents the estimated value of unbilled work. Retainage represents a portion of the contract amount that has been billed, but for which the contract allows the customer to retain a portion of the billed amount until final contract settlement (generally, from 5% to 10% of contract billings). Retainage is not considered to be a significant financing component because the intent is to protect the customer. CIEB and retainage amounts are generally classified as current assets within the Company’s consolidated balance sheets.

Under certain contracts, the Company may be entitled to receive payments in advance of performing the related contract work. In those instances, the Company recognizes a liability for advance billings in excess of revenue recognized, which is referred to as billings in excess of costs and earnings (“BIEC”). BIEC is not considered to be a significant financing component because it is generally used to meet working capital demands that can be higher in the early stages of a contract. Contract liabilities consist primarily of such BIEC, which are generally classified within current liabilities on the Company’s consolidated balance sheets. If revenue from BIEC is not expected to be recognized within one year, the related amounts are classified as other long-term liabilities. For the three month period ended March 31, 2018, the Company recognized revenue of approximately $84.8 million related to amounts that were included in BIEC as of December 31, 2017, resulting primarily from the advancement of physical progress on the respective projects during the period. Contract liabilities also include accrued project losses, which are classified within other current liabilities on the Company’s consolidated balance sheets.

Provisions for doubtful accounts for each of the three month periods ended March 31, 2018 and 2017 totaled $0.8 million and $0.5 million, respectively. Retainage, which has been billed, but is not due until completion of performance and acceptance by customers, is expected to be collected within one year. Accounts receivable expected to be collected beyond one year are recorded within other long-term assets. The increase in the CIEB balance for the three month period ended March 31, 2018 was driven largely by long-haul project activity and timing of billings within our Oil and Gas segment.

The Company is party to non-recourse financing arrangements in the ordinary course of business, under which certain receivables are settled with the customer’s bank in return for a nominal fee. These arrangements, under which amounts can vary based on levels of activity, interest rates and changes in customer payment terms, improve the collection cycle time of the related receivables. Cash collected from these arrangements is reflected within cash provided by operating activities in the consolidated statements of cash flows. The discount charge, which is included within interest expense, net, totaled approximately $1.9 million and $0.9 million for the three month periods ended March 31, 2018 and 2017, respectively.