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Accounts and Long-Term Receivable

12 Months Ended

Sep. 30, 2021

3. Accounts and Long-Term Receivable

Within accounts receivable and long-term receivable there are amounts due reflecting sales whose payment terms exceed one year. This financing is separate from agreements with a leasing component, see Note 10 Leases for financing through leases. These receivables are included in Accounts Receivable and Long-Term Receivable in the amount of $6.5 million and $7.5 million as of September 30, 2021, respectively. These receivables are included in Accounts Receivable and Long-Term Receivable in the amount of $2.3 million and $3.5 million as of September 30, 2020, respectively. The receivables with a payment term exceeding one year carry an average weighted interest rate of 4.5% as of September 30, 2021, which reflects the approximate interest rate consistent with a separate financing transaction with the customer at the inception of the agreement.

There is not an allowance for credit losses nor impairments for accounts and long-term receivables with a contractual maturity of over one year. All accounts had no past amounts due as of September 30, 2021 or 2020, respectively. There was no activity in the allowance for credit losses of these receivables for the years ended September 30, 2021 or 2020, respectively. All these agreements are looked at as one portfolio in determining credit losses. There are various factors that are considered in extending a customer payment terms longer than one year including payment history, economic conditions, and capacity to pay. The credit quality of customers is monitored by payment activity. The unearned income represents a rate similar to market at the inception of the agreement.

The amount of interest income earned from sales whose payment terms exceed one year for the year ended September 30, 2021 and 2020 was $547 thousand and $453 thousand, respectively. Interest income from these agreements is recorded in Other income, net on the Consolidated Statements of Operations.

There were two new agreements effective in the second quarter of fiscal year 2021 causing an increase in accounts and long-term receivable. These agreements included approximately $9.0 million of payments to be received over the next 4 years from the effective date of the agreement. It was determined we were acting as the agent in the transactions and recorded net revenue of approximately $0.5 million during the second quarter of fiscal year 2021. There were two new agreements effective in the third quarter of fiscal year 2021 causing an increase in accounts and long-term receivable. These agreements included approximately $5.2 million of payments to be received over the next 2 years from the effective date of the agreement. It was determined we were acting as the agent in the transactions and recorded net revenue of approximately $0.4 million during the third quarter of fiscal year 2021. There were two new agreements effective in the fourth quarter of fiscal year 2021 causing an increase in accounts and long-term receivable. These agreements included approximately $2.5 million of payments to be received over the next 2 years from the effective date of the agreement. It was determined we were acting as the agent in the transactions and recorded net revenue of approximately $0.2 million during the fourth quarter of fiscal year 2021.

Receivables whose payment terms exceed one year are placed on nonaccrual status, meaning interest income stops being recorded, when the customer has a past due amount in excess of 30 days or reasonable doubt exists in collecting all interest and principal. A payment due in excess of 30 days is considered delinquent. If a payment is received for a receivable on nonaccrual status the payment is first applied to interest and then principal. Recording interest income resumes once no reasonable doubt exists regarding collecting all interest and principal.

Contractual maturities of outstanding financing receivables with an original contractual maturity over one year are as follows:


Fiscal year ending September 30:	(Amounts in thousands)
2022	$	6,927
2023		4,674
2024		1,560
2025		1,560
Total payments		14,721
Less: unearned interest income		753
Total, net of unearned interest income	$	13,968