Financing Receivables and Operating Leases (Tables)

12 Months Ended

Oct. 31, 2019

Leases [Abstract]

Components of financing receivables

The components of financing receivables were as follows:

	As of October 31,
	2019			2018
	In millions
Minimum lease payments receivable	$	9,070		$	8,691
Unguaranteed residual value	336			297
Unearned income	(754		)	(732		)
Financing receivables, gross	8,652			8,256
Allowance for doubtful accounts	(131		)	(120		)
Financing receivables, net	8,521			8,136
Less: current portion(1)	(3,572		)	(3,396		)
Amounts due after one year, net(1)	$	4,949		$	4,740

(1)

The Company includes the current portion in Financing receivables, and amounts due after one year, net, in Long-term financing receivables and other assets in the accompanying Consolidated Balance Sheets.

Scheduled maturities of minimum lease payments receivable

As of October 31, 2019, scheduled maturities of the Company's minimum lease payments receivable were as follows:

	2020		2021		2022		2023		2024		Thereafter		Total
	In millions
Scheduled maturities of minimum lease payments receivable	$	3,939	$	2,449	$	1,555	$	752	$	306	$	69	$	9,070

Credit risk profile of gross financing receivables

The credit risk profile of gross financing receivables, based on internal risk ratings, was as follows:

	As of October 31,
	2019		2018
	In millions
Risk Rating:
Low	$	4,432	$	4,238
Moderate	3,933		3,805
High	287		213
Total	$	8,652	$	8,256

Schedule of allowance for doubtful accounts for financing receivables

The allowance for doubtful accounts related to financing receivables and changes therein were as follows:

	As of October 31,
	2019			2018			2017
	In millions
Balance at beginning of year	$	120		$	86		$	89
Provision for doubtful accounts	33			49			23
Write-offs	(22		)	(15		)	(26		)
Balance at end of year	$	131		$	120		$	86

Gross financing receivables and related allowance collectively and individually evaluated for loss

The gross financing receivables and related allowance evaluated for loss were as follows:

	As of October 31,
	2019		2018
	In millions
Gross financing receivables collectively evaluated for loss	$	8,255	$	7,917
Gross financing receivables individually evaluated for loss(1)	397		339
Total	$	8,652	$	8,256
Allowance for financing receivables collectively evaluated for loss	$	84	$	78
Allowance for financing receivables individually evaluated for loss	47		42
Total	$	131	$	120

(1)

Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables.

Summary of the aging and non-accrual status of gross financing receivables

The following table summarizes the aging and non-accrual status of gross financing receivables:

	As of October 31,
	2019		2018
	In millions
Billed:(1)
Current 1-30 days	$	301	$	275
Past due 31-60 days	62		42
Past due 61-90 days	15		13
Past due >90 days	88		74
Unbilled sales-type and direct-financing lease receivables	8,186		7,852
Total gross financing receivables	$	8,652	$	8,256
Gross financing receivables on non-accrual status(2)	$	276	$	226
Gross financing receivables 90 days past due and still accruing interest(2)	$	121	$	113

(1) Includes billed operating lease receivables and billed sales-type and direct-financing lease receivables.

(2)

Includes billed operating lease receivables and billed and unbilled sales-type and direct-financing lease receivables.

Schedule of Variable Interest Entities

The assets in the table below includes those that can be used to settle the obligations of the VIE. Additionally, general Creditors do not have recourse to the assets of the VIE.

	As of October 31, 2019
Assets held by VIE	In millions
Other current assets	$	76
Financing receivables
Short-term	$	194
Long-term	$	229
Property, plant and equipment	$	303
Liabilities held by VIE
Notes payable and short-term borrowings, net of unamortized debt issuance costs	$	385
Long-term debt, net of unamortized debt issuance costs	$	370

Schedule of operating lease assets included in machinery and equipment

Operating lease assets included in Property, plant and equipment in the Consolidated Balance Sheets were as follows:

	As of October 31,
	2019			2018
	In millions
Equipment leased to customers	$	7,185		$	7,290
Accumulated depreciation	(3,101		)	(3,078		)
Total	$	4,084		$	4,212

Minimum future rentals on non-cancelable operating leases

As of October 31, 2019, minimum future rentals on non-cancelable operating leases related to leased equipment were as follows:

	2020		2021		2022		2023		2024		Thereafter		Total
	In millions
Minimum future rentals on non-cancelable operating leases	$	1,847	$	1,162	$	437	$	91	$	27	$	2	$	3,566