2. Accounts Receivable

6 Months Ended

Aug. 02, 2015

Loans, Notes, Trade and Other Receivables Disclosure [Text Block]

2.	Accounts Receivable

	August 2,			February 1,
	2015			2015
Trade accounts receivable	$	25,727		$	25,322
Receivable from factor		3,837			8,252
Allowance for doubtful accounts		(1,020	)		(1,329	)
Accounts receivable	$	28,544		$	32,245

“Receivable from factor” represents amounts due with respect to factored accounts receivable. Before the fiscal 2016 second quarter, we factored substantially all of our domestically-produced upholstery accounts receivable without recourse to us. However, we ended our Sam Moore factoring relationship as our new ERP system became fully operational at Sam Moore at the beginning of the fiscal 2016 second quarter. We are presently managing Sam Moore’s accounts receivable in-house. As of August 2, 2015, $167,000 in Sam Moore receivables represent outstanding receivables for which payment is due to us from the factor as part of its residual obligations under Sam Moore’s legacy factoring agreement.

Under our current factoring agreement, which continues to serve Bradington-Young (BY), invoices for domestically produced BY upholstery products are generated and transmitted to our customers, with copies to the factor on a daily basis, as products are shipped to our customers. The factor collects the amounts due and remits collected funds to us semi-weekly, less factoring fees. We retain ownership of the accounts receivable until the invoices are 90 days past due. At that time, the factor pays us the net invoice amount, less factoring fees, and takes ownership of the accounts receivable. The factor is then entitled to collect the invoices on its own behalf and retain any subsequent remittances. The invoiced amounts are reported as accounts receivable on our condensed consolidated balance sheets, generally from the date the merchandise is shipped to our customer until payment is received from the factor.

A limited number of our accounts receivable for our domestically produced BY upholstery products are factored with recourse to us. The amounts of these receivables at August 2, 2015 and February 1, 2015 were $219,000 and $237,000, respectively, of which $6,000 and $13,000, respectively, represented Sam Moore recourse receivables. If the factor is unable to collect the amounts due, invoices are returned to us for collection. We include an estimate of potentially uncollectible receivables in the calculation of our allowance for doubtful accounts.