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Revenue Recognition | 9 Months Ended
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Sep. 28, 2019
Revenue Recognition |
Revenue Recognition | 7. Revenue Recognition CRA offers functional expertise across a variety of litigation, regulatory, financial, industry and management consulting services. Together, these services comprised all of CRA's consolidated revenues during the fiscal quarters and fiscal year-to-date periods ended September 28, 2019 and September 29, 2018. The contracts that CRA enters into and operates under specify whether the engagement will be billed on a time-and-materials or a fixed-price basis. Disaggregation of Revenue The following table disaggregates CRA’s revenue by type of contract and geographic location (in thousands):
|  | Fiscal Quarter Ended |  | Fiscal Year-to-Date Period Ended
|  | September 28, |  | September 29, |  | September 28, |  | September 29,
Type of Contract |  | 2019 |  | 2018 |  | 2019 |  | 2018
Consulting services revenues: |  |  |  |  |  |  |  |  |  |  |  |
Fixed Price |  | $ | 30,057 |  | $ | 25,047 |  | $ | 76,622 |  | $ | 66,440
Time-and-materials |  |  | 85,629 |  |  | 78,824 |  |  | 255,486 |  |  | 242,445
Total |  | $ | 115,686 |  | $ | 103,871 |  | $ | 332,108 |  | $ | 308,885
|  | Fiscal Quarter Ended |  | Fiscal Year-to-Date Period Ended
|  | September 28, |  | September 29, |  | September 28, |  | September 29,
Geographic Breakdown |  | 2019 |  | 2018 |  | 2019 |  | 2018
Consulting services revenues: |  |  |  |  |  |  |  |  |  |  |  |
United States |  | $ | 92,217 |  | $ | 80,721 |  | $ | 263,221 |  | $ | 244,878
United Kingdom |  |  | 17,116 |  |  | 17,253 |  |  | 53,027 |  |  | 47,317
Other |  |  | 6,353 |  |  | 5,897 |  |  | 15,860 |  |  | 16,690
Total |  | $ | 115,686 |  | $ | 103,871 |  | $ | 332,108 |  | $ | 308,885
Reserves for Variable Consideration and Credit Risk Revenues from CRA's consulting services are recorded at the net transaction price, which includes estimates of variable consideration for which reserves are established. Variable consideration reserves are based on actual price concessions and those expected to be extended to CRA customers and are recorded as a component of the allowances for accounts receivable and unbilled services. Adjustments to the variable consideration reserves are as follows (in thousands):
|  | Fiscal Quarter Ended |  | Fiscal Year-to-Date Period Ended
|  | September 28, |  | September 29, |  | September 28, |  | September 29,
|  | 2019 |  | 2018 |  | 2019 |  | 2018
Adjustments to reserves for variable consideration and credit risk |  | $ | 2,282 |  | $ | 2,441 |  | $ | 6,440 |  | $ | 5,887
Bad debt expense is reported as a component of selling, general and administrative expense. Bad debt expense is as follows (in thousands):
|  | Fiscal Quarter Ended |  | Fiscal Year-to-Date Period Ended
|  | September 28, |  | September 29, |  | September 28, |  | September 29,
|  | 2019 |  | 2018 |  | 2019 |  | 2018
Bad debt expense |  | $ | 142 |  | $ | 748 |  | $ | 173 |  | $ | 1,150
Reimbursable Expenses Revenues also include reimbursements for costs incurred by CRA in fulfilling its performance obligations, including travel and other out-of-pocket expenses, fees for outside consultants and other reimbursable expenses. CRA recovers substantially all of these costs. The following expenses are subject to reimbursement (in thousands):
|  | Fiscal Quarter Ended |  | Fiscal Year-to-Date Period Ended
|  | September 28, |  | September 29, |  | September 28, |  | September 29,
|  | 2019 |  | 2018 |  | 2019 |  | 2018
Reimbursable expenses |  | $ | 13,978 |  | $ | 11,422 |  | $ | 38,991 |  | $ | 34,737
CRA collects goods and services (GST/HST) and value added taxes (VAT) from customers and records these amounts on a net basis. Transaction Price Allocated to Future Performance Obligations ASC 606 requires that CRA disclose the aggregate amount of transaction price that is allocated to performance obligations that have not yet been satisfied as of September 28, 2019. The guidance provides certain practical expedients that limit this requirement for (1) contracts with an original expected length of one year or less and (2) contracts for which revenue is recognized at the amount to which CRA has the right to invoice for consulting services performed. Given the nature of its business, CRA does not disclose the value of unsatisfied performance obligations as the practical expedients apply to its unsatisfied performance obligations as of September 28, 2019. Contract Balances from Contracts with Customers CRA defines contract assets as assets for which it has recorded revenue because it determines that it is probable that it will earn a performance based or contingent fee, but is not yet entitled to receive a fee, because certain events, such as completion of the measurement period or client approval, must occur. These contract assets are included in accounts receivable, net and unbilled services, net within the consolidated balance sheets. The contract assets balance was immaterial as of September 28, 2019 and December 29, 2018. CRA defines contract liabilities as advance payments from or billings to its clients for services that have not yet been performed or earned and retainers. These liabilities are recorded within deferred revenues and are recognized as services are provided. When consideration is received, or such consideration is unconditionally due from a customer prior to transferring consulting services to the customer under the terms of a contract, a contract liability is recorded. Contract liabilities are recognized as revenue after control of the consulting services are transferred to the customer and all revenue recognition criteria have been met. The following table presents the opening and closing balances of CRA’s contract liability (in thousands):
|  | Contract Liability
|  | Fiscal Year-to-Date |  | Fiscal Year
|  | Period Ended |  | Ended
|  | September 28, 2019 |  | December 29, 2018
Balance at the beginning of the period |  | $ | 5,453 |  | $ | 3,287
Balance at the end of the period |  | $ | 2,502 |  | $ | 5,453
During the fiscal quarter and fiscal year-to-date period ended September 28, 2019, CRA recognized the following revenue as a result of changes in the contract liability balance (in thousands):
|  | Fiscal Quarter Ended |  | Fiscal Year-to-Date Period Ended
|  | September 28, |  | September 28,
|  | 2019 |  | 2019
Amounts included in contract liabilities at the beginning of the period |  | $ | 2,405 |  | $ | 4,900
Performance obligations satisfied in previous periods |  | $ | 3,395 |  | $ | 3,606
The timing of revenue recognition, billings and cash collections results in billed receivables, unbilled services and contract liabilities on the condensed consolidated balance sheets.

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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://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 606 -URI http://asc.fasb.org/topic&trid=49130388 Reference 2: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -URI http://asc.fasb.org/topic&trid=2122369 + Details
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