Contract Assets and Liabilities

6 Months Ended

Jun. 30, 2019

Contract with Customer, Asset and Liability [Abstract]

Contract Assets and Liabilities

12. Contract Assets and Liabilities

Contract assets includes unbilled amounts typically resulting from sales under contracts when the cost-to-cost method of revenue recognition is utilized, and revenue recognized exceeds the amount billed to the customer. Contract assets are transferred to Accounts receivable, net when the entitlement to pay becomes unconditional. Contract liabilities include advance payments and billings in excess of revenue recognized. Contract liabilities are included in Accrued liabilities in the Consolidated Balance Sheets.

Contract assets and Contract liabilities are reported on the Consolidated Balance Sheets in a net position on a contract-by-contract basis at the end of each reporting period. As of June 30, 2019 and December 31, 2018 Contract assets and Contract liabilities consisted of the following:

(in thousands)	June 30, 2019	December 31, 2018
Contract assets	$54,431	$57,447
Contract liabilities	6,824	9,025

Contract assets decreased approximately $3 million during the six month period ended June 30, 2019. The decrease was primarily due to invoicing to customers exceeding revenue recognized for satisfied performance obligations for contracts that were in a contract asset position. There were no impairment losses related to our Contract assets during the three and six month periods ended June 30, 2019.

Contract liabilities decreased approximately $2 million during the six month period ended June 30, 2019, primarily due to revenue recognized from satisfied performance obligations exceeding amounts invoiced to customers for contracts that were in a contract liability position. Revenue recognized for the six month period ended June 30, 2019, that was included in the Contract liability balance as of December 31, 2018 was $5 million, and included revenue in the MC and AEC segments.