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TRADE AND OTHER ACCOUNTS RECEIVABLE CURRENT, AND NON- CURRENT ACCOUNTS RECEIVABLE
 12 Months Ended
Dec. 31, 2021
TRADE AND OTHER ACCOUNTS RECEIVABLE CURRENT, AND NON- CURRENT ACCOUNTS RECEIVABLE [Abstract]  
TRADE AND OTHER ACCOUNTS RECEIVABLE CURRENT, AND NON- CURRENT ACCOUNTS RECEIVABLE

NOTE 8 - TRADE AND OTHER ACCOUNTS RECEIVABLE CURRENT, AND NON- CURRENT ACCOUNTS RECEIVABLE

 

   As of   As of 
   December 31,   December 31, 
   2021   2020 
   ThUS$   ThUS$ 
Trade accounts receivable   785,952    532,106 
Other accounts receivable   209,925    194,454 
Total trade and other accounts receivable   995,877    726,560 
Less: Expected credit loss   (81,004)   (122,193)
Total net trade and  accounts receivable   914,873    604,367 
Less: non-current portion – accounts receivable   (12,201)   (4,986)
Trade and other accounts receivable, current   902,672    599,381 

 

The fair value of trade and other accounts receivable does not differ significantly from the book value.

 

To determine the expected credit losses, the Company groups accounts receivable for passenger and cargo transportation; depending on the characteristics of shared credit risk and maturity.

 

   As of December 31, 2021   As December 31, 2020 
   Expected   Gross book   Impairment loss   Expected   Gross book   Impairment loss 
Portfolio maturity  loss rate (1)   value (2)   Provision   loss rate (1)   value (2)   Provision 
   %   ThUS$   ThUS$   %   ThUS$   ThUS$ 
Up to date   1%   591,210    (8,806)   4%   302,079    (11,112)
From 1 to 90 days   10%   116,613    (11,840)   4%   103,615    (4,049)
From 91 to 180 days   31%   11,376    (3,567)   66%   15,989    (10,501)
From 181 to 360 days   72%   3,863    (2,766)   80%   40,621    (32,627)
more of 360 days   86%   62,890    (54,025)   92%   69,802    (63,904)
Total        785,952    (81,004)        532,106    (122,193)

 

(1)Corresponds to the consolidated expected rate of accounts receivable.
(2)The gross book value represents the maximum credit risk value of trade accounts receivables.

 

Currency balances composition of the Trade and other accounts receivable and non-current accounts receivable are as follow:

 

   As of   As of 
   December 31,   December 31, 
Currency  2021   2020 
   ThUS$   ThUS$ 
Argentine Peso   7,282    6,517 
Brazilian Real   361,745    221,952 
Chilean Peso   53,488    44,737 
Colombian Peso   5,657    1,292 
Euro   24,143    24,370 
US Dollar   441,079    292,125 
Korean Won   844    79 
Mexican Peso   2,428    4,624 
Australian Dollar   62    49 
Pound Sterling   12,728    5,647 
Uruguayan Peso  (New)   860    792 
Swiss Franc   360    754 
Japanese Yen   106    77 
Swedish crown   488    129 
Other Currencies   3,603    1,223 
Total   914,873    604,367 

 

The movements of the provision for impairment losses of the Trade Debtors and other accounts receivable are as follows:

 

    Opening       (Increase)   Closing 
Periods   balance   Write-offs   Decrease   balance 
    ThUS$   ThUS$   ThUS$   ThUS$ 
From January 1 to December  31, 2019    (97,991)   12,569    (14,980)   (100,402)
From January 1 to December  31, 2020    (100,402)   30,754    (52,545)   (122,193)
From January 1 to December  31, 2021    (122,193)   26,435    14,754    (81,004)

 

Once pre-judicial and judicial collection efforts are exhausted, the assets are written off against the allowance. The Company only uses the allowance method rather than direct write-off, to ensure control.

 

The historical and current renegotiations are not very relevant, and the policy is to analyze case by case to classify them according to the existence of risk, determining if their reclassification corresponds to pre-judicial collection accounts.

 

The maximum credit-risk exposure at the date of presentation of the information is the fair value of each one of the categories of accounts receivable indicated above.

 

   As of December 31, 2021   As of December 31, 2020 
   Gross  exposure   Gross   Exposure net   Gross  exposure   Gross   Exposure net 
   according to   impaired   of risk   according to   Impaired   of risk 
   balance   exposure   concentrations   balance   exposure   concentrations 
   ThUS$   ThUS$   ThUS$   ThUS$   ThUS$   ThUS$ 
Trade accounts receivable   785,952    (81,004)   704,948    532,106    (122,193)   409,913 
Other accounts  receivable   209,925    
-
    209,925    194,454    
-
    194,454 

 

There are no relevant guarantees covering credit risk and these are valued when they are settled; no materially significant direct guarantees exist. Existing guarantees, if appropriate, are made through IATA.