Finance Receivables

Finance receivables are receivables of our Financial Services operations. Finance receivables generally consist of wholesale notes and accounts, as well as retail notes, finance leases and accounts. Total finance receivables reported on the Consolidated Balance Sheets are net of an allowance for doubtful accounts. Total assets of our Financial Services operations net of intercompany balances were $2.2 billion and $2.1 billion as of July 31, 2017 and October 31, 2016, respectively. Included in total assets of our Financial Services operations were finance receivables of $1.8 billion and $1.7 billion as of July 31, 2017 and October 31, 2016, respectively. We have two portfolio segments of finance receivables that we distinguish based on the type of customer and nature of the financing inherent to each portfolio. The retail portfolio segment represents loans or leases to end-users for the purchase or lease of vehicles. The wholesale portfolio segment represents loans to dealers to finance their inventory.

Our Finance receivables, net in our Consolidated Balance Sheets consist of the following:



(in millions)	July 31, 2017		October 31, 2016
Retail portfolio	$	520	$	499
Wholesale portfolio	1,291		1,199
Total finance receivables	1,811		1,698
Less: Allowance for doubtful accounts	23		21
Total finance receivables, net	1,788		1,677
Less: Current portion, net^(A)	1,557		1,457
Noncurrent portion, net	$	231	$	220

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(A)	The current portion of finance receivables is computed based on contractual maturities. Actual cash collections typically vary from the contractual cash flows because of prepayments, extensions, delinquencies, credit losses, and renewals.

Securitizations

Our Financial Services operations transfer wholesale notes, retail accounts receivable, finance leases, and operating leases to special purpose entities ("SPEs"), which generally are only permitted to purchase these assets, issue asset-backed securities, and make payments on the securities issued. In addition to servicing receivables, our continued involvement in the SPEs may include an economic interest in the transferred receivables and, in some cases, managing exposure to interest rate changes on the securities using interest rate swaps or interest rate caps. There were no transfers of finance receivables that qualified for sale accounting treatment as of July 31, 2017 and October 31, 2016, and as a result, the transferred finance receivables are included in our Consolidated Balance Sheets and the related interest earned is included in Finance revenues.

We transfer eligible finance receivables into wholesale note owner trusts in order to issue asset-backed securities. These trusts are VIEs of which we are determined to be the primary beneficiary and, therefore, the assets and liabilities of the trusts are included in our Consolidated Balance Sheets. The outstanding balance of finance receivables transferred into these VIEs was $820 million and $829 million as of July 31, 2017 and October 31, 2016, respectively. Other finance receivables related to secured transactions that do not qualify for sale accounting treatment were $122 million and $108 million as of July 31, 2017 and October 31, 2016, respectively. For more information on assets and liabilities of consolidated VIEs and other securitizations accounted for as secured borrowings by our Financial Services segment, see Note 1, Summary of Significant Accounting Policies.

Finance Revenues

The following table presents the components of our Finance revenues in our Consolidated Statements of Operations:



	Three Months Ended July 31,				Nine Months Ended July 31,
(in millions)	2017		2016		2017		2016
Retail notes and finance leases revenue	$	11	$	9	$	30	$	28
Wholesale notes interest	28		29		75		81
Operating lease revenue	17		17		50		49
Retail and wholesale accounts interest	6		5		17		19
Gross finance revenues	62		60		172		177
Less: Intercompany revenues	27		26		70		75
Finance revenues	$	35	$	34	$	102	$	102