Financing Receivables (Tables)

12 Months Ended

Dec. 31, 2018

Financing Receivables

Summary of the components of financing receivables

($ in millions)

							Client Loan and
	Investment in						Installment
	Sales-Type and			Commercial			Payment
	Direct Financing			Financing			Receivables/
At December 31, 2018:	Leases			Receivables			(Loans)			Total
Financing receivables, gross	$	6,846		$	11,889		$	13,614		$	32,348
Unearned income	(526		)	(37		)	(632		)	(1,195		)
Recorded investment	$	6,320		$	11,852		$	12,981		$	31,153
Allowance for credit losses	(99		)	(13		)	(179		)	(292		)
Unguaranteed residual value	589			—			—			589
Guaranteed residual value	85			—			—			85
Total financing receivables, net	$	6,895		$	11,838		$	12,802		$	31,536
Current portion	$	2,834		$	11,838		$	7,716		$	22,388
Noncurrent portion	$	4,061		$	—		$	5,086		$	9,148

($ in millions)

							Client Loan and
	Investment in						Installment
	Sales-Type and			Commercial			Payment
	Direct Financing			Financing			Receivables/
At December 31, 2017:	Leases			Receivables			(Loans)			Total
Financing receivables, gross	$	7,128		$	11,649		$	13,311		$	32,087
Unearned income	(535		)	(32		)	(644		)	(1,210		)
Recorded investment	$	6,593		$	11,617		$	12,667		$	30,877
Allowance for credit losses	(103		)	(21		)	(211		)	(336		)
Unguaranteed residual value	630			—			—			630
Guaranteed residual value	100			—			—			100
Total financing receivables, net	$	7,220		$	11,596		$	12,456		$	31,272
Current portion	$	2,900		$	11,596		$	7,226		$	21,721
Noncurrent portion	$	4,320		$	—		$	5,230		$	9,550

Schedule of financing receivables and allowance for credit losses by portfolio segment

($ in millions)

At December 31, 2018:	Americas			EMEA			Asia Pacific			Total
Recorded investment:
Lease receivables	$	3,827		$	1,341		$	1,152		$	6,320
Loan receivables	6,817			3,675			2,489			12,981
Ending balance	$	10,644		$	5,016		$	3,641		$	19,301
Recorded investment, collectively evaluated for impairment	$	10,498		$	4,964		$	3,590		$	19,052
Recorded investment, individually evaluated for impairment	$	146		$	52		$	51		$	249
Allowance for credit losses
Beginning balance at January 1, 2018
Lease receivables	$	63		$	9		$	31		$	103
Loan receivables	108			52			51			211
Total	$	172		$	61		$	82		$	314
Write-offs	(10		)	(2		)	(23		)	(35		)
Recoveries	0			0			2			2
Provision	7			9			0			16
Other*	(11		)	(3		)	(4		)	(19		)
Ending balance at December 31, 2018	$	158		$	65		$	56		$	279
Lease receivables	$	53		$	22		$	24		$	99
Loan receivables	$	105		$	43		$	32		$	179
Related allowance, collectively evaluated for impairment	$	39		$	16		$	5		$	59
Related allowance, individually evaluated for impairment	$	119		$	49		$	51		$	219

* Primarily represents translation adjustments.

($ in millions)

At December 31, 2017:	Americas			EMEA			Asia Pacific			Total
Recorded investment:
Lease receivables	$	3,911		$	1,349		$	1,333		$	6,593
Loan receivables	6,715			3,597			2,354			12,667
Ending balance	$	10,626		$	4,946		$	3,687		$	19,259
Recorded investment, collectively evaluated for impairment	$	10,497		$	4,889		$	3,604		$	18,990
Recorded investment, individually evaluated for impairment	$	129		$	57		$	83		$	269
Allowance for credit losses
Beginning balance at January 1, 2017
Lease receivables	$	54		$	4		$	76		$	133
Loan receivables	169			18			89			276
Total	$	223		$	22		$	165		$	410
Write-offs	(51		)	(1		)	(85		)	(137		)
Recoveries	1			1			0			2
Provision	(8		)	29			(4		)	16
Other*	7			11			6			24
Ending balance at December 31, 2017	$	172		$	61		$	82		$	314
Lease receivables	$	63		$	9		$	31		$	103
Loan receivables	$	108		$	52		$	51		$	211
Related allowance, collectively evaluated for impairment	$	43		$	15		$	6		$	64
Related allowance, individually evaluated for impairment	$	128		$	46		$	76		$	250

* Primarily represents translation adjustments.

Schedule of past due financing receivables

($ in millions)

					Recorded		Billed
	Total		Recorded		Investment		Invoices >90		Recorded
	Recorded		Investment		>90 Days and		Days and		Investment Not
At December 31, 2018:	Investment		>90 Day(1)		Accruing(1)		Accruing		Accruing(2)
Americas	$	3,827	$	310	$	256	$	19	$	57
EMEA	1,341		25		9		1		16
Asia Pacific	1,152		49		27		3		24
Total lease receivables	$	6,320	$	385	$	292	$	24	$	97
Americas	$	6,817	$	259	$	166	$	24	$	99
EMEA	3,675		98		25		3		73
Asia Pacific	2,489		40		11		1		31
Total loan receivables	$	12,981	$	397	$	202	$	29	$	203
Total	$	19,301	$	782	$	494	$	52	$	300

(1) At a contract level, which includes total billed and unbilled amounts for financing receivables aged greater than 90 days.

(2) Of the recorded investment not accruing, $249 million is individually evaluated for impairment with a related allowance of $219 million.

($ in millions)

					Recorded		Billed
	Total		Recorded		Investment		Invoices >90		Recorded
	Recorded		Investment		>90 Days and		Days and		Investment Not
At December 31, 2017:	Investment		>90 Days(1)		Accruing(1)		Accruing		Accruing(2) (3)
Americas	$	3,911	$	239	$	197	$	29	$	44
EMEA	1,349		32		5		3		27
Asia Pacific	1,333		57		23		3		36
Total lease receivables	$	6,593	$	328	$	225	$	36	$	107
Americas	$	6,715	$	345	$	254	$	38	$	96
EMEA	3,597		90		17		0		74
Asia Pacific	2,354		63		12		3		54
Total loan receivables	$	12,667	$	498	$	283	$	41	$	224
Total	$	19,259	$	825	$	507	$	77	$	331

(1) At a contract level, which includes total billed and unbilled amounts for financing receivables aged greater than 90 days.

(2) Of the recorded investment not accruing, $269 million is individually evaluated for impairment with a related allowance of $250 million.

(3) Recast to conform to current period presentation, which includes billed impaired amounts.

Schedule of net recorded investment by credit quality indicator

Lease Receivables

($ in millions)

At December 31, 2018:	Americas		EMEA		Asia Pacific
Credit rating
Aaa–Aa3	$	593	$	45	$	85
A1–A3	678		158		413
Baa1–Baa3	892		417		297
Ba1–Ba2	852		426		191
Ba3–B1	433		171		84
B2–B3	299		90		50
Caa–D	26		10		7
Total	$	3,774	$	1,319	$	1,128

Loan Receivables

($ in millions)

At December 31, 2018:	Americas		EMEA		Asia Pacific
Credit rating
Aaa–Aa3	$	1,055	$	125	$	185
A1–A3	1,206		436		901
Baa1–Baa3	1,587		1,148		648
Ba1–Ba2	1,516		1,175		417
Ba3–B1	770		472		184
B2–B3	531		249		109
Caa–D	47		28		15
Total	$	6,712	$	3,633	$	2,457

Lease Receivables

($ in millions)

At December 31, 2017:	Americas		EMEA		Asia Pacific
Credit rating
Aaa–Aa3	$	422	$	49	$	68
A1–A3	855		190		544
Baa1–Baa3	980		371		337
Ba1–Ba2	730		448		184
Ba3–B1	443		192		89
B2–B3	367		77		64
Caa–D	51		13		18
Total	$	3,847	$	1,340	$	1,302

Loan Receivables

($ in millions)

At December 31, 2017:	Americas		EMEA		Asia Pacific
Credit rating
Aaa–Aa3	$	724	$	129	$	120
A1–A3	1,469		502		961
Baa1–Baa3	1,683		982		596
Ba1–Ba2	1,253		1,186		325
Ba3–B1	760		508		157
B2–B3	630		204		113
Caa–D	88		34		31
Total	$	6,607	$	3,545	$	2,303