Accounts and Notes Receivable, Net

12 Months Ended

Dec. 31, 2021

ACCOUNTS AND NOTES RECEIVABLE - NET


(In millions)	December 31, 2021		December 31, 2020
Accounts receivable – trade1	$	3,441	$	3,754
Notes receivable – trade1,2	120		163
Other3	1,250		1,009
Total accounts and notes receivable - net	$	4,811	$	4,926

1.Accounts receivable – trade and notes receivable – trade are net of allowances of $210 million and $208 million at December 31, 2021 and December 31, 2020, respectively. Allowances are equal to the estimated uncollectible amounts and are based on the expected credit losses and were developed using a loss-rate method.

2.Notes receivable – trade primarily consists of receivables for deferred payment loan programs for the sale of seed products to customers. These loans have terms of one year or less and are primarily concentrated in North America. The company maintains a rigid pre-approval process for extending credit to customers in order to manage overall risk and exposure associated with credit losses. As of December 31, 2021 and 2020, there were no significant impairments related to current loan agreements.

3.Other includes receivables in relation to indemnification assets, value added tax, general sales tax and other taxes. No individual group represents more than 10 percent of total receivables. In addition, Other includes amounts due from nonconsolidated affiliates of $104 million and $106 million as of December 31, 2021 and 2020, respectively.

Accounts and notes receivable are carried at the expected amount to be collected, which approximates fair value. The company establishes the allowance for doubtful receivables using a loss-rate method where the loss rate is developed using past events, historical experience, current conditions and forecasts that affect the collectability of the financial assets.

The following table summarizes changes in the allowance for doubtful receivables for the year ended December 31, 2021 and 2020, respectively:


(In millions)
2020
Balance at December 31, 2019	$	174
Net provision for credit losses1	52
Write-offs charged against allowance / other1	(18)
Balance at December 31, 2020	$	208

2021
Balance at December 31, 2020	$	208
Net provision for credit losses	1
Write-offs charged against allowance / other	1
Balance at December 31, 2021	$	210

1. Prior year classifications in the changes in the allowance for doubtful receivables have been adjusted from their previous presentation. Adjustments did not impact the amount of the provision or the allowance for doubtful receivables recorded in the Consolidated Statements of Operations or the Consolidated Balance Sheets.

The company enters into various factoring agreements with third-party financial institutions to sell its trade receivables under both recourse and non-recourse agreements in exchange for cash proceeds. These financing arrangements result in a transfer of the company's receivables and risks to the third-party. As these transfers qualify as true sales under the applicable accounting guidance, the receivables are derecognized from the Consolidated Balance Sheets upon transfer, and the company receives a payment for the receivables from the third-party within a mutually agreed upon time period. For arrangements involving an element of recourse, which is typically provided through a guarantee of accounts in the event of customer default, the guarantee obligation is measured using market data from similar transactions and reported as a current liability in the Consolidated Balance Sheets.

Trade receivables sold under these agreements were $272 million, $255 million, and $328 million for the years ended December 31, 2021, 2020 and 2019, respectively. The trade receivables sold that remained outstanding under these agreements which include an element of recourse as of December 31, 2021 and December 31, 2020 were $166 million and $157 million, respectively. The net proceeds received were included in cash provided by (used for) operating activities in the Consolidated

Statements of Cash Flows. The difference between the carrying amount of the trade receivables sold and the sum of the cash received is recorded as a loss on sale of receivables in other income - net in the Consolidated Statements of Operations. The loss on sale of receivables were $54 million, $55 million, and $44 million for the years ended December 31, 2021, 2020 and 2019, respectively. See Note 18 - Commitments and Contingent Liabilities, to the Consolidated Financial Statements, for additional information on the company’s guarantees.