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Revenue and Credit Losses | 9 Months Ended
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Sep. 30, 2023
Revenue from Contract with Customer [Abstract] |
REVENUE AND CREDIT LOSSES | REVENUE AND CREDIT LOSSES Our operations primarily consist of providing environmental services. The following table disaggregates our revenue by service line for the three and nine months ended September 30, 2023 and 2022 (in millions of dollars and as a percentage of revenue):
| Three Months Ended September 30, |  | Nine Months Ended September 30,
| 2023 |  | 2022 |  | 2023 |  | 2022
Collection: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Residential | $ | 718.2 |  |  | 18.8 | % |  | $ | 680.9 |  |  | 18.9 | % |  | $ | 2,103.4 |  |  | 18.9 | % |  | $ | 1,963.0 |  |  | 19.7 | %
Small-container | 1,126.3 |  |  | 29.4 |  |  | 1,021.8 |  |  | 28.4 |  |  | 3,270.2 |  |  | 29.4 |  |  | 2,912.9 |  |  | 29.2 |
Large-container | 753.0 |  |  | 19.7 |  |  | 709.6 |  |  | 19.7 |  |  | 2,192.4 |  |  | 19.7 |  |  | 2,018.0 |  |  | 20.2 |
Other | 19.0 |  |  | 0.5 |  |  | 14.6 |  |  | 0.4 |  |  | 51.9 |  |  | 0.5 |  |  | 40.3 |  |  | 0.4 |
Total collection | 2,616.5 |  |  | 68.4 |  |  | 2,426.9 |  |  | 67.4 |  |  | 7,617.9 |  |  | 68.5 |  |  | 6,934.2 |  |  | 69.5 |
Transfer | 444.3 |  |  |  |  | 412.8 |  |  |  |  | 1,280.5 |  |  |  |  | 1,183.5 |  |  |
Less: intercompany | (238.1) |  |  |  |  | (223.5) |  |  |  |  | (703.3) |  |  |  |  | (637.5) |  |  |
Transfer, net | 206.2 |  |  | 5.4 |  |  | 189.3 |  |  | 5.3 |  |  | 577.2 |  |  | 5.2 |  |  | 546.0 |  |  | 5.5 |
Landfill | 743.2 |  |  |  |  | 703.6 |  |  |  |  | 2,172.4 |  |  |  |  | 2,019.7 |  |  |
Less: intercompany | (306.9) |  |  |  |  | (291.4) |  |  |  |  | (912.6) |  |  |  |  | (851.9) |  |  |
Landfill, net | 436.3 |  |  | 11.4 |  |  | 412.2 |  |  | 11.5 |  |  | 1,259.8 |  |  | 11.3 |  |  | 1,167.8 |  |  | 11.7 |
Environmental solutions | 424.0 |  |  |  |  | 411.0 |  |  |  |  | 1,274.0 |  |  |  |  | 827.8 |  |  |
Less: intercompany | (19.2) |  |  |  |  | (13.8) |  |  |  |  | (62.5) |  |  |  |  | (37.1) |  |  |
Environmental solutions, net | 404.8 |  | 10.6 |  |  | 397.2 |  | 11.0 |  |  | 1,211.5 |  |  | 10.9 |  |  | 790.7 |  | 7.9 |
Other: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Recycling processing and commodity sales | 76.3 |  |  | 2.0 |  |  | 86.9 |  |  | 2.4 |  |  | 226.6 |  |  | 2.0 |  |  | 300.4 |  |  | 3.0 |
Other non-core | 85.8 |  |  | 2.2 |  |  | 85.3 |  |  | 2.4 |  |  | 239.9 |  |  | 2.1 |  |  | 242.4 |  |  | 2.4 |
Total other | 162.1 |  | 4.2 |  |  | 172.2 |  |  | 4.8 |  |  | 466.5 |  |  | 4.1 |  |  | 542.8 |  |  | 5.4 |
Total revenue | $ | 3,825.9 |  |  | 100.0 | % |  | $ | 3,597.8 |  |  | 100.0 | % |  | $ | 11,132.9 |  |  | 100.0 | % |  | $ | 9,981.5 |  |  | 100.0 | %
Other non-core revenue consists primarily of revenue from National Accounts, which represents the portion of revenue generated from nationwide or regional contracts in markets outside our operating areas where the associated material handling is subcontracted to local operators. Consequently, substantially all of this revenue is offset with related subcontract costs, which are recorded in cost of operations. See Note 12, Segment Reporting, for additional information regarding revenue by reportable segment. Revenue Recognition Our service obligations of a long-term nature, e.g., certain collection service contracts, are satisfied over time, and we recognize revenue based on the value provided to the customer during the period. The amount billed to the customer is based on variable elements such as the number of residential homes or businesses for which collection services are provided, the volume of material collected, treated, transported and disposed, and the nature of the material accepted. We do not disclose the value of unsatisfied performance obligations for these contracts as our right to consideration corresponds directly to the value provided to the customer for services completed to date and all future variable consideration is allocated to wholly unsatisfied performance obligations. Additionally, certain elements of our long-term customer contracts are unknown upon entering into the contract, including the amount that will be billed in accordance with annual price escalation clauses, our fuel recovery fee program and commodity prices. The amount to be billed is often tied to changes in an underlying base index such as a consumer price index or a fuel or commodity index, and revenue can be recognized once the index is established for the period. Environmental solutions revenue is primarily generated from the fees we charge for the collection, treatment, consolidation, disposal and recycling of hazardous and non-hazardous waste, field and industrial services, equipment rental, emergency response and standby services and in-plant services, such as transportation and logistics, including at our transfer, storage and disposal facilities (TSDF). Activity for this service line varies across markets and reflects the regulatory environment, pricing and disposal alternatives available in any given market. Revenue recognized is variable in nature and primarily based on the volume and type of waste accepted or processed during the period. For certain field and industrial services contracts, we have a right to consideration from our customers in an amount that corresponds directly with the value to the customer of the Company's performance completed to date. Therefore, we have applied the practical expedient to recognize revenue in the amount to which we have the right to invoice. Deferred Revenue The factors that impact the timing and amount of revenue recognized for each service line may vary based on the nature of the service performed. Generally, we recognize revenue at the time we perform a service. In the event that we bill for services in advance of performance, we recognize deferred revenue for the amount billed and subsequently recognize revenue at the time the service is provided. Depending on the nature of the contract, we may also generate revenue through the collection of fuel recovery fees and environmental fees which are designed to recover our internal costs of providing services to our customers. Substantially all of the deferred revenue recognized as of December 31, 2022 was recognized as revenue during the nine months ended September 30, 2023 when the service was performed. Deferred Contract Costs We incur certain upfront payments to acquire customer contracts which are recognized as other assets in our consolidated balance sheet, and we amortize the asset over the respective contract life. In addition, we recognize sales commissions that represent an incremental cost of the contract as other assets in our consolidated balance sheets, and we amortize the asset over the average life of the customer relationship. As of September 30, 2023 and December 31, 2022, we recognized $82.2 million and $80.2 million, respectively, of deferred contract costs and capitalized sales commissions. During the three and nine months ended September 30, 2023, we amortized $3.5 million and $10.8 million, respectively, of capitalized sales commissions to selling, general and administrative expenses and we amortized $1.2 million and $4.0 million, respectively, of other deferred contract costs as a reduction of revenue. During the three and nine months ended September 30, 2022, we amortized $3.2 million and $10.0 million, respectively, of capitalized sales commissions to selling, general and administrative expenses and we amortized $1.4 million and $4.4 million, respectively, of other deferred contract costs as a reduction of revenue. Credit Losses Accounts receivable represent receivables from customers for environmental services, including collection and processing of recyclable materials, collection, transfer, and disposal of solid waste, and other environmental solutions. Our receivables are recorded when billed or when the related revenue is earned and represent claims against third parties that will be settled in cash. The carrying value of our receivables, net of the allowance for doubtful accounts and customer credits, represents their estimated net realizable value. We establish an allowance for doubtful accounts based on various factors including the age of receivables outstanding, historical trends, economic conditions and other information. We also review outstanding balances on an account-specific basis based on the credit risk of the customer. We determined that all of our accounts receivable share similar risk characteristics. We monitor our credit exposure on an ongoing basis and assess whether assets in the pool continue to display similar risk characteristics. We perform ongoing credit evaluations of our customers, but generally do not require collateral to support customer receivables. The following table reflects the activity in our allowance for doubtful accounts for the nine months ended September 30, 2023 and 2022:
| 2023 |  | 2022
Balance at beginning of year | $ | 51.9 |  |  | $ | 38.5 |
Additions charged to expense | 38.6 |  |  | 27.8 |
Accounts written-off | (7.0) |  |  | (16.9) |
Balance at end of period | $ | 83.5 |  |  | $ | 49.4 |

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- Definition The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 9 -Publisher FASB -URI https://asc.fasb.org//1943274/2147479806/606-10-50-9 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 10 -Publisher FASB -URI https://asc.fasb.org//1943274/2147479806/606-10-50-10 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 15 -Publisher FASB -URI https://asc.fasb.org//1943274/2147479806/606-10-50-15 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479806/606-10-50-12 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479806/606-10-50-12 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479806/606-10-50-12 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479806/606-10-50-12 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 12 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479806/606-10-50-12 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Topic 606 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 13 -Subparagraph (b)(2) -Publisher FASB -URI https://asc.fasb.org//1943274/2147479806/606-10-50-13 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Topic 606 -Publisher FASB -URI https://asc.fasb.org//606/tableOfContent + Details
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