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Accounts Receivable
12 Months Ended
Dec. 31, 2020
Receivables [Abstract]  
Accounts Receivable
11. Accounts Receivable
As of December 31, 2020 and 2019, Accounts receivable consisted of the following:
(in thousands)
December 31,
2020
December 31,
2019
Trade and other accounts receivable$167,370 $201,427 
Bank promissory notes24,860 18,563 
Allowance for expected credit losses(3,807)(1,719)
Accounts receivable, net$188,423 $218,271 

The Company has Noncurrent receivables in the AEC segment that represent revenue earned, which has extended payment terms. The Noncurrent receivables will be invoiced to the customer over a 10-year period, which began in 2020. As of December 31, 2020 and December 31, 2019, Noncurrent receivables were as follows:
(in thousands)December 31,
2020
December 31,
2019
Noncurrent receivables$36,539 $41,234 
Allowance for expected credit losses(274) 
Noncurrent receivables, net$36,265 $41,234 

As described in Note 1, effective January 1, 2020, the Company adopted the provisions of ASC 326, Current Expected Credit Losses (CECL). This accounting update replaces the incurred loss impairment methodology under current GAAP with a methodology that reflects expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. Under the new standard, the Company recognizes an allowance for expected credit losses on financial assets measured at amortized cost, such as Accounts receivable, Contract assets and Noncurrent receivables. The allowance is determined using a CECL model that is based on an historical average three-year loss rate and is measured by financial asset type on a collective (pool) basis when similar risk characteristics exist, at an amount equal to lifetime expected credit losses. The estimate reflects the risk of loss due to credit default, even when the risk is remote, and considers available relevant information about the collectability of cash flows, including information about past events, current conditions, and reasonable and supportable expected future economic conditions.
While an expected credit loss allowance is recorded at the same time the financial asset is recorded, the Company monitors financial assets for credit impairment events to assess whether there has been a significant increase in credit risk since initial recognition, and considers both quantitative and qualitative information. The risk of loss due to credit default increases when one or more events occur that can have a detrimental impact on estimated future cash flows of that financial asset. Evidence that a financial asset is subject to greater credit risk includes observable data about significant financial difficulty of the customer, a breach of contract, such as a default or past due event, or it becomes probable that the customer will enter bankruptcy or other financial reorganization, among other factors. It may not be possible to identify a single discrete event, but rather, the combined effect of several events that may cause an increase in risk of loss.
The probability of default is driven by the relative financial health of our customer base and that of the industries in which we operate, as well as the broader macro-economic environment. A changing economic environment or forecasted economic scenario can lead to a different probability of default and can suggest that credit risk has changed. Such is the case with the global COVID-19 pandemic, which has increased uncertainty and poses a significant challenge to the macro-economic environment. Management believes this has increased the probability of credit default, causing the Company to increase the allowance for expected credit losses during 2020.
At each reporting period, the Company will recognize the amount of change in current expected credit losses as an allowance gain or loss in Selling, general, and administrative expenses in the Consolidated Statements of Income.
Financial assets are written-off when the Company has no reasonable expectation of recovering the financial asset, either in its entirety, or a portion thereof. This is the case when the Company determines that the customer does not have assets or sources of income that could generate sufficient cash flows to repay the amounts subject to the write-off.
The following table presents the (increases)/decreases in the allowance for credit losses for Accounts receivable in 2020:

(in thousands)December 31,
2019
CECL
transition
adjustment
ChargesCurrency
translation
OtherDecember 31,
2020
Specific customer reserves$(1,719)$(44)$(43)$(42)$106 $(1,742)
Incremental expected credit losses— (1,139)(857)(46)(23)(2,065)
Accounts receivable expected credit losses$(1,719)$(1,183)$(900)$(88)$83 $(3,807)

The following table presents the (increases)/decreases in the allowance for credit losses for Noncurrent receivables in 2020:

(in thousands)December 31,
2019
CECL
transition
adjustment
ChargesCurrency
translation
OtherDecember 31,
2020
Noncurrent receivables expected credit losses$— $(206)$(71)$$— $(274)