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Receivables | 9 Months Ended
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Sep. 30, 2023
Receivables [Abstract] |
Receivables | Receivables The following table displays a roll forward of the allowance for doubtful trade receivables.
(in Millions) |
Balance, December 31, 2021 | $ | 37.4 |
Additions - charged to expense | 0.7 |
Transfer from (to) allowance for credit losses (see below) | 0.5 |
Net recoveries, write-offs and other | (4.7) |
Balance, December 31, 2022 | $ | 33.9 |
Additions - charged to expense | 2.9 |
Transfer from (to) allowance for credit losses (see below) | (1.5) |
Net recoveries, write-offs and other | 1.4 |
Balance, September 30, 2023 | $ | 36.7 |
We have non-current receivables that represent long-term customer receivable balances related to past due accounts which are not expected to be collected within the current year. The net long-term customer receivables were $23.5 million as of September 30, 2023. These long-term customer receivable balances and the corresponding allowance are included in "Other assets including long-term receivables, net" on the condensed consolidated balance sheets. A portion of these long-term receivables have payment contracts. We have no reason to believe payments will not be made based upon the credit quality of these customers. Additionally, we also hold significant collateral against these customers including rights to property or other assets as a form of credit guarantee. If the customer does not pay or gives indication that they will not pay, these guarantees allow us to start legal action to block the sale of the customer’s harvest. On an ongoing basis, we continue to evaluate the credit quality of our non-current receivables using aging of receivables, collection experience and write-offs, as well as evaluating existing economic conditions, to determine if an additional allowance is necessary. The following table displays a roll forward of the allowance for credit losses related to long-term customer receivables:
(in Millions) |
Balance, December 31, 2021 | $ | 27.7 |
Additions - charged (credited) to expense | (1.2) |
Transfer from (to) allowance for doubtful accounts (see above) | (0.5) |
Foreign currency adjustments | 8.1 |
Net recoveries, write-offs and other | 10.4 |
Balance, December 31, 2022 | $ | 44.5 |
Additions - charged (credited) to expense | 0.6 |
Transfer from (to) allowance for doubtful accounts (see above) | 1.5 |
Foreign currency adjustments | 0.2 |
Net recoveries, write-offs and other(1) | (17.0) |
Balance, September 30, 2023 | $ | 29.8 |
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(1) Relates to activity settled during the period that was provisioned for during prior periods. |
Receivables Securitization Facility: FMC entered into a trade receivables securitization program, primarily impacting our Brazilian operations during the third quarter of 2022. On a revolving basis, FMC may sell certain trade receivables into the facility in exchange for cash. A portion of the total receivables sold are deferred as an asset on our condensed consolidated balance sheets representing FMC’s beneficial interest in the securitization fund. In all instances, the transferred financial assets are sold on a non-recourse basis and have met the true sale criteria under ASC Topic 860. FMC has surrendered control of the receivables and as a result they will no longer be recognized on the condensed consolidated balance sheets. FMC may be engaged to serve as a special servicer for any delinquent receivables. In that capacity, we are entitled to market rate compensation for those services. Cash receipts from the sale of trade receivables under the securitization arrangement, received at the time of sale, are classified as cash flows from operating activities. There were $97.3 million in receivables sold under the securitization program during the nine months ended September 30, 2023. A $6.5 million charge associated with the transfer of these financial assets is included as a component within selling, general and administrative expense during the nine months ended September 30, 2023. There were $50.5 million in receivables sold under the securitization program during the nine months ended September 30, 2022. As part of the initial funding, approximately $19 million of the 2022 sale was retained by the investment fund and will be returned to FMC, including interest, at the maturity of the securitization. A $5.2 million charge associated with the transfer of these financial assets is included as a component within selling, general and administrative expense during the nine months ended September 30, 2022. Other Receivable Factoring: In addition to the above, we may sell trade receivables on a non-recourse basis to third-party financial institutions. These sales are normally driven by specific market conditions, including, but not limited to, foreign exchange environments, customer credit management, as well as other factors where the receivables may lay. We account for these transactions as true sales and as a result they will no longer be recognized on the condensed consolidated balance sheets because the agreements transfer effective control and risk related to the receivables to the buyers. The net cash proceeds received are presented within cash provided by operating activities within our condensed consolidated statements of cash flows. The cost of factoring these accounts receivables is recorded as an expense within the condensed consolidated statements of income (loss) and has been inconsequential during each reporting period. During the nine months ended September 30, 2023, there was $155.0 million in non-recourse factoring. There was no non-recourse factoring during the nine months ended September 30, 2022.

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- Definition The entire disclosure for claims held for amounts due a entity, excluding financing receivables. Examples include, but are not limited to, trade accounts receivables, notes receivables, loans receivables. Includes disclosure for allowance for credit losses. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 310 -SubTopic 10 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//310-10/tableOfContent + Details
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