Accounts Receivable

9 Months Ended

Sep. 30, 2021


5.			Accounts Receivable

Accounts receivable consists of amounts billed to and due from customers across a wide range of industries and other third parties. The Company often extends short-term credit to cardholders and pays the merchant for the purchase price, less the fees it retains and records as revenue. The Company subsequently collects the total purchase price from the cardholder. In general, the Company’s trade receivables provide for payment terms of 30 days or less. Receivables not paid in full by payment due dates as stated within the terms of the agreement are generally considered past due and subject to late fees and interest based upon the outstanding receivables balance. The Company discontinues late fee and interest income accruals on outstanding receivables once customers are 90 and 120 days past the invoice due date, respectively. Payments received subsequent to discontinuing late fee and interest income accruals are first applied to outstanding late fees and interest, and the Company resumes accruing interest and late fee income as earned on future receivables balances. Receivables are generally written off when they are 180 days past invoice origination date or upon declaration of bankruptcy of the customer, subject to local regulatory restrictions.

The Company extends revolving credit to certain small fleets. These accounts are also subject to late fees, and balances that are not paid in full are subject to interest charges based on the revolving balance. The Company had approximately $87.7 million and $60.2 million in receivables with revolving credit balances as of September 30, 2021 and December 31, 2020, respectively.

The allowance for accounts receivable consists primarily of reserves for credit losses, reflecting management’s current estimate of uncollectible balances on its accounts receivable. Accounts receivable are evaluated for impairment on a pooling basis based on similar risk characteristics including industry of the borrower, historical or expected credit loss patterns, risk ratings or classification, and geographic location. The following tables present changes in the accounts receivable allowances by portfolio segment:


	Three Months Ended September 30, 2021
(In thousands)	Fleet Solutions		Travel and Corporate Solutions		Health and Employee Benefit Solutions		Total


Balance, beginning of period	$	49,716	$	7,519	$	536	$	57,771
Provision for credit losses1	10,231		3,816		80		14,127
Charges to other accounts2	4,046		5		—		4,051
Charge-offs	(10,872)		(602)		(92)		(11,566)
Recoveries of amounts previously charged-off	1,691		163		53		1,907
Currency translation	(392)		(206)		—		(598)
Balance, end of period	$	54,420	$	10,695	$	577	$	65,692


	Three Months Ended September 30, 2020
(In thousands)	Fleet Solutions		Travel and Corporate Solutions		Health and Employee Benefit Solutions		Total


Balance, beginning of period	$	47,109	$	16,142	$	592	$	63,843
Provision for credit losses1,3	8,526		3,725		32		12,283
Charges to other accounts2	3,200		—		—		3,200
Charge-offs	(18,334)		(10,149)		(63)		(28,546)
Recoveries of amounts previously charged-off	3,213		—		—		3,213
Currency translation	504		31		(263)		272
Balance, end of period	$	44,218	$	9,749	$	298	$	54,265


	Nine Months Ended September 30, 2021
(In thousands)	Fleet Solutions		Travel and Corporate Solutions		Health and Employee Benefit Solutions		Total


Balance, beginning of period	$	49,267	$	9,610	$	270	$	59,147
Provision for credit losses1	26,359		5,568		221		32,148
Charges to other accounts2	12,267		5		—		12,272
Charge-offs	(37,239)		(4,462)		(120)		(41,821)
Recoveries of amounts previously charged-off	4,572		176		206		4,954
Currency translation	(806)		(202)		—		(1,008)
Balance, end of period	$	54,420	$	10,695	$	577	$	65,692


	Nine Months Ended September 30, 2020
(In thousands)	Fleet Solutions		Travel and Corporate Solutions		Health and Employee Benefit Solutions		Total


Balance, beginning of period	$	50,010	$	5,765	$	8,076	63,851
Provision for credit losses1,3	47,418		19,230		203		66,851
Charges to other accounts2	13,930		—		—		13,930
Charge-offs	(75,711)		(15,214)		(5,381)		(96,306)
Recoveries of amounts previously charged-off	8,101		28		17		8,146
Currency translation	470		(60)		(2,617)		(2,207)
Balance, end of period	$	44,218	$	9,749	$	298	$	54,265

1 The provision is comprised of estimated credit losses based on the Company’s loss-rate experience and adjustments required for forecasted credit loss information. The provision for credit losses reported within this table also includes the provision for fraud losses.

2 The Company earns revenue by assessing monthly finance fees on accounts with overdue balances. These fees are recognized as revenue at the time the fees are assessed. The finance fee is calculated using the greater of a minimum charge or a stated late fee rate multiplied by the outstanding balance that is subject to a late fee charge. On occasion, these fees are waived to maintain customer relationship goodwill. Charges to other accounts represents the offset against the late fee revenue recognized when the Company establishes a reserve for such waived amounts.

3 The provision for the three and nine months ended September 30, 2020 reflects an increase in expected credit losses as a result of COVID-19.

Concentration of Credit Risk

The receivables portfolio consists of a large group of homogeneous smaller balances across a wide range of industries, which are collectively and individually evaluated for impairment. No one customer receivable balance represented 10 percent or more of the outstanding receivables balance at September 30, 2021 or December 31, 2020. The following table presents the outstanding balance of trade accounts receivable that are less than 30 and 60 days past due, in each case, as a percentage of total trade accounts receivable:


Delinquency Status	September 30, 2021		December 31, 2020
29 days or less past due	99	%	97	%
59 days or less past due	99	%	98	%