Financing Receivables (Tables)

12 Months Ended

Dec. 31, 2022

Financing Receivables

Summary of the components of financing receivables


($ in millions)
		Client Financing Receivables
		Client Loan and			Investment in
		Installment Payment			Sales-Type and			Commercial Financing Receivables
		Receivables			Direct Financing			Held for			Held for
At December 31, 2022:		(Loans)			Leases			Investment			Sale		*	Total
Financing receivables, gross		$	8,875		$	4,023		$	299		$	939		$	14,136
Unearned income			(439)			(351)			—			—			(790)
Unguaranteed residual value			—			422			—			—			422
Amortized cost		$	8,437		$	4,094		$	299		$	939		$	13,769
Allowance for credit losses			(108)			(60)			(5)			—			(173)
Total financing receivables, net		$	8,329		$	4,034		$	293		$	939		$	13,596
Current portion		$	5,073		$	1,485		$	293		$	939		$	7,790
Noncurrent portion		$	3,256		$	2,549		$	—		$	—		$	5,806


($ in millions)
		Client Financing Receivables
		Client Loan and			Investment in
		Installment Payment			Sales-Type and			Commercial Financing Receivables
		Receivables			Direct Financing			Held for			Held for
At December 31, 2021:		(Loans)			Leases			Investment			Sale		*	Total
Financing receivables, gross		$	9,303		$	3,336		$	450		$	793		$	13,881
Unearned income			(353)			(223)			—			—			(576)
Unguaranteed residual value			—			335			—			—			335
Amortized cost		$	8,949		$	3,448		$	450		$	793		$	13,640
Allowance for credit losses			(131)			(64)			(6)			—			(201)
Total financing receivables, net		$	8,818		$	3,384		$	444		$	793		$	13,439
Current portion		$	5,371		$	1,406		$	444		$	793		$	8,014
Noncurrent portion		$	3,447		$	1,978		$	—		$	—		$	5,425

* The carrying value of the receivables classified as held for sale approximates fair value.

Schedule of transfer of client and commercial financing assets


($ in millions)
For the year ended December 31:		2022			2021
Commercial financing receivables
Receivables transferred during the period		$	9,029		$	7,359
Receivables uncollected at end of period*		$	1,561		$	1,653
Client financing receivables
Lease receivables		$	15		$	819
Loan receivables			2			2,224
Total client financing receivables transferred		$	17		$	3,043

*	Of the total amount of commercial financing receivables sold and derecognized from the Consolidated Balance Sheet, the amounts presented remained uncollected from business partners as of December 31, 2022 and 2021.

Schedule of financing receivables and allowance for credit losses by class


($ in millions)
At December 31, 2022:		Americas			EMEA			Asia Pacific			Total
Amortized cost		$	7,281		$	3,546		$	1,704		$	12,531
Allowance for credit losses
Beginning balance at January 1, 2022		$	111		$	61		$	23		$	195
Write-offs			(20)			(3)			(2)			(25)
Recoveries			1			0			4			5
Additions/(releases)			(5)			6			(4)			(3)
Other*			2			(5)			(2)			(4)
Ending balance at December 31, 2022		$	88		$	60		$	20		$	168


($ in millions)
At December 31, 2021:		Americas			EMEA			Asia Pacific			Total
Amortized cost		$	6,573		$	3,793		$	2,031		$	12,397
Allowance for credit losses
Beginning balance at January 1, 2021		$	141		$	77		$	37		$	255
Write-offs			(8)			(2)			(7)			(17)
Recoveries			0			0			1			1
Additions/(releases)			(19)			(11)			(7)			(38)
Other*			(3)			(3)			0			(7)
Ending balance at December 31, 2021		$	111		$	61		$	23		$	195

* Primarily represents translation adjustments.

Schedule of past due financing receivables


($ in millions)
								Amortized			Billed			Amortized
		Total			Amortized			Cost			Invoices			Cost
		Amortized			Cost			> 90 Days and			> 90 Days and			Not
At December 31, 2022:		Cost			> 90 Days		^*	Accruing		^*	Accruing			Accruing		^**
Americas		$	7,281		$	272		$	198		$	22		$	74
EMEA			3,546			52			8			1			46
Asia Pacific			1,704			20			3			1			17
Total client financing receivables		$	12,531		$	344		$	208		$	23		$	137


($ in millions)
								Amortized			Billed			Amortized
		Total			Amortized			Cost			Invoices			Cost
		Amortized			Cost			> 90 Days and			> 90 Days and			Not
At December 31, 2021:		Cost			> 90 Days		^*	Accruing		^*	Accruing			Accruing		^**
Americas		$	6,573		$	188		$	100		$	6		$	90
EMEA			3,793			99			7			2			95
Asia Pacific			2,031			25			5			2			20
Total client financing receivables		$	12,397		$	312		$	112		$	10		$	205

*	At a contract level, which includes total billed and unbilled amounts for financing receivables aged greater than 90 days.

**	Of the amortized cost not accruing, there was a related allowance of $122 million and $153 million at December 31, 2022 and 2021, respectively. Financing income recognized on these receivables was immaterial for the years ended December 31, 2022 and 2021, respectively.

Schedule of amortized cost by credit quality indicator


($ in millions)
		Americas						EMEA						Asia Pacific
At December 31, 2022:		Aaa - Baa3			Ba1 - D			Aaa - Baa3			Ba1 - D			Aaa - Baa3			Ba1 - D
Vintage year
2022		$	3,316		$	1,097		$	1,447		$	704		$	799		$	96
2021			1,197			323			451			159			203			65
2020			559			217			258			158			210			49
2019			251			91			161			99			127			22
2018			128			26			42			16			84			21
2017 and prior			32			45			14			38			12			17
Total		$	5,482		$	1,800		$	2,373		$	1,173		$	1,434		$	269


($ in millions)
		Americas						EMEA						Asia Pacific
At December 31, 2021:		Aaa - Baa3			Ba1 - D			Aaa - Baa3			Ba1 - D			Aaa - Baa3			Ba1 - D
Vintage year
2021		$	2,556		$	1,147		$	1,181		$	778		$	565		$	226
2020			1,013			392			506			342			381			86
2019			544			236			287			291			297			51
2018			338			117			189			85			211			64
2017			108			50			15			52			74			17
2016 and prior			20			53			21			46			38			20
Total		$	4,579		$	1,994		$	2,198		$	1,595		$	1,567		$	464