05 » Accounts Receivable
Accounts receivable consist mainly of the currencies US dollar, euro, and Chinese renminbi and are as follows:
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Collective loss allowance |
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Individual loss allowance |
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Total |
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|---|---|---|---|---|---|---|---|---|---|---|---|---|
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Not yet due |
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Past due 31 – 90 days |
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Past due > 90 days |
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Not credit-impaired |
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Not credit-impaired |
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Not credit-impaired |
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Credit-impaired |
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Credit-impaired |
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|
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|
|
|
|
|
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|
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|
|
Dec. 31, 2023 |
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable, gross |
|
1,678 |
|
239 |
|
49 |
|
43 |
|
127 |
|
2,135 |
Weighted average loss rate |
|
1.6% |
|
8.6% |
|
29.3% |
|
97.0% |
|
99.1% |
|
10.7% |
Loss allowance |
|
(28) |
|
(21) |
|
(14) |
|
(41) |
|
(126) |
|
(229) |
Accounts receivable, net |
|
1,650 |
|
219 |
|
34 |
|
1 |
|
1 |
|
1,906 |
|
|
|
|
|
|
|
|
|
|
|
|
|
Dec. 31, 2022 |
|
|
|
|
|
|
|
|
|
|
|
|
Accounts receivable, gross |
|
2,073 |
|
428 |
|
60 |
|
63 |
|
135 |
|
2,759 |
Weighted average loss rate |
|
1.5% |
|
6.2% |
|
22.0% |
|
42.8% |
|
98.2% |
|
8.3% |
Loss allowance |
|
(31) |
|
(26) |
|
(13) |
|
(27) |
|
(133) |
|
(230) |
Accounts receivable, net |
|
2,042 |
|
402 |
|
47 |
|
36 |
|
2 |
|
2,529 |
|
|
2023 |
|
2022 |
|---|---|---|---|---|
Loss allowances at January 1 |
|
230 |
|
208 |
Net remeasurement of loss allowances |
|
6 |
|
33 |
Write-offs charged against the loss allowance accounts |
|
(8) |
|
(12) |
Currency translation differences |
|
(2) |
|
0 |
Other changes |
|
3 |
|
1 |
Loss allowances at December 31 |
|
229 |
|
230 |
As at December 31, 2023, the loss allowance for not-credit-impaired accounts receivable in the amount of € 244 million and credit-impaired accounts receivable in the amount of € 6 million was not recognized as adidas holds credit enhancement instruments, mainly in the form of credit insurance and bank guarantees, which mitigate the credit risk of those financial assets.
There are no material balances of accounts receivable written off but subject to enforcement activity.
Accounts receivable are derecognized when substantially all the risks and rewards incidental to the financial asset are transferred to a third party under factoring arrangements. As of December 31, 2023, accounts receivable amounting to € 70 million (2022: € 112 million) were derecognized in connection with factoring agreements in Japan. The purchase price corresponds to the nominal amount of the respective receivable, less any deductions relating to the receivable (e.g. discounts) granted by adidas to the debtor and less the factoring fee and interest. The factoring fee amounts to 0.08% of the nominal amount of the purchased receivables. Interest on the disbursed purchase price is based on an interest rate composed of the ‘Tokyo Interbank Offered Rate’ (reference interest rate) plus a margin of 0.19% to 1.33% p.a. and is paid for the period from the disbursement of the purchase price portion to the settlement of the receivable by the debtor.
Further information about credit risks is contained in these Notes. see Note 28