Sale of Receivables

12 Months Ended

Dec. 31, 2023

Transfers and Servicing [Abstract]

Sale of Receivables

Sale of Receivables

The Company is party to factoring facilities with various financial institutions (the “purchasers”) with an aggregate capacity of $275 million. Pursuant to the servicing agreements, collections on sold receivables that had not yet been remitted to the financial institutions are included within short-term borrowings and current portion of long-term debt in the Consolidated Balance Sheets. See Note 13: Debt for further information.

The receivables sold under the factoring facilities are without recourse for any customer credit risk and result in a true sale. Receivables are derecognized in their entirety when sold, and the Company’s continuing involvement is limited to their servicing, for which the Company receives a fee commensurate with the service provided and therefore no servicing asset or liability related to these receivables was recognized for any period presented. The fair value of the sold receivables approximated their book value due to their short-term nature. Proceeds from the sold receivables are reflected in operating cash flows on the Consolidated Statements of Cash Flows.

During the years ended December 31, 2023, 2022 and 2021, the Company incurred purchase discount fees of $5 million, $4 million, and $2 million, respectively, which are presented in other general and administrative expenditures, net on the Consolidated Statements of Earnings.

The table below summarizes the activity under the factoring facilities:

	December 31,
(Dollars in millions)	2023		2022
Beginning balance	$	243	$	215
Sales of receivables	303		373
Cash returned to purchasers	(354)		(345)
Outstanding balance sold to purchasers(1)	192		243
Cash collected, not remitted to purchasers(2)	(35)		(10)
Remaining sold receivables	$	157	$	233

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(1)For 2023, the Company recorded a net decrease to cash flows from operating activities of $51 million from sold receivables and for 2022 a net increase to cash flows from operating activities of $28 million.

(2)Represents cash collected on behalf of purchasers and not yet remitted.