Accounts and Notes Receivable (Notes)

3 Months Ended

Mar. 31, 2022

Accounts and Notes Receivable [Abstract]

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

ACCOUNTS AND NOTES RECEIVABLE - NET

(In millions)	March 31, 2022		December 31, 2021		March 31, 2021
Accounts receivable – trade1	$	5,603	$	3,441	$	5,231
Notes receivable – trade1,2	426		120		533
Other3	1,246		1,250		1,028
Total accounts and notes receivable - net	$	7,275	$	4,811	$	6,792

1.Accounts receivable – trade and notes receivable - trade are net of allowances of $232 million, $210 million, and $203 million at March 31, 2022, December 31, 2021, and March 31, 2021, 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 March 31, 2022, December 31, 2021, and March 31, 2021 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 $124 million, $104 million, and $115 million as of March 31, 2022, December 31, 2021, and March 31, 2021, 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 three months ended March 31, 2022 and 2021:

(In millions)
2021
Balance at December 31, 2020	$	208
Net benefit for credit losses	(5)
Balance at March 31, 2021	$	203
2022
Balance at December 31, 2021	$	210
Net provision for credit losses	5
Write-offs charged against allowance / other	17
Balance at March 31, 2022	$	232

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 interim 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 interim Consolidated Balance Sheets.

Trade receivables sold under these agreements were $17 million and $11 million for the three months ended March 31, 2022 and 2021, respectively. The trade receivables sold that remained outstanding under these agreements which include an element of recourse as of March 31, 2022, December 31, 2021, and March 31, 2021 were $130 million, $166 million, and $128 million, respectively. The net proceeds received are included in cash provided by (used for) operating activities in the interim 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 interim Consolidated Statements of Operations. The loss on sale of receivables for the three months ended March 31, 2022 and 2021, respectively, was not material. See Note 12 - Commitments and Contingent Liabilities for additional information on the company’s guarantees.