Note 5. Revenue and Accounts Receivable

Revenue resulting from contracts and subcontracts with the U.S. Government accounted for 95.4%, 93.7%, and 93.7% of consolidated revenue in 2020, 2019, and 2018, respectively. As our primary customer base includes agencies of the U.S. Government, we have a concentration of credit risk associated with our accounts receivable, as 96.1% of our billed accounts receivable were directly with U.S. Government customers. While we acknowledge the potentially material and adverse risk of such a significant concentration of credit risk, our past experience of collecting substantially all of such receivables provide us with an informed basis that such risk, if any, is manageable. We perform ongoing credit evaluations of all of our customers and generally do not require collateral or other guarantee from our customers. We maintain allowances for potential losses.

On July 15, 2016, the Company entered into an accounts receivable purchase agreement under which the Company could sell certain accounts receivable to a third party, or the “Factor”, without recourse to the Company. The Factor initially paid the Company 90% of U.S. Federal government receivables or 85% of certain commercial prime contractors’ receivables that were sold under the agreement. The remaining payment was deferred and based on the amount the Factor received from our customer, less a discount fee and a program access fee that was determined by the amount of time the receivable was outstanding before payment. The structure of the transaction provided for a true sale of the receivables transferred. Accordingly, upon transfer of the receivable to the Factor, the receivable was removed from the Company's consolidated balance sheet, a loss on the sale was recorded and the residual amount remains a deferred payment as an accounts receivable until payment was received from the Factor. The balance of the sold receivables could not exceed $10 million. There were no accounts receivable sold during 2020. During the year ended December 31, 2019, the Company sold approximately $12.6 million of accounts receivable, and recognized a related loss of approximately $0.1 million in selling, general and administrative expenses for the same period. As of December 31, 2020 and 2019, there were no outstanding sold accounts receivable.

The components of accounts receivable and contract assets are as follows (in thousands):

	December 31,
	2020			2019
Billed accounts receivable	$	12,060		$	11,917
Unbilled receivables		19,161			16,745
Allowance for doubtful accounts		(308	)		(720	)
Total	$	30,913		$	27,942

The activities in the allowance for doubtful accounts are set forth below (in thousands):

	Balance Beginning of Year		Bad Debt Expenses (1)			Recoveries (2)		Balance End of Year

Year Ended December 31, 2020	$	720	$	(412	)	$	—	$	308
Year Ended December 31, 2019	$	306	$	414		$	—	$	720
Year Ended December 31, 2018	$	411	$	(105	)	$	—	$	306

(1)	Accounts receivable reserves and reversal of allowance for subsequent collections, net

(2)	Accounts receivable written-off and subsequent recoveries, net

Revenue by Major Market and Significant Customers

We derived a substantial portion of our revenues from contracts and subcontracts with the U.S. Government. Revenue by customer sector for the last three fiscal years is as follows:

	2020				2019				2018
					(dollar amounts in thousands)

Federal	$	171,677	95.4	%	$	149,257	93.7	%	$	129,279	93.7	%
State & Local, and Commercial		8,240	4.6	%		9,961	6.3	%		8,737	6.3	%
Total	$	179,917	100.0	%	$	159,218	100.0	%	$	138,016	100.0	%