Quarterly report pursuant to Section 13 or 15(d)

Financing Receivables and Allowances for Credit Losses

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Financing Receivables and Allowances for Credit Losses
9 Months Ended
Jun. 30, 2011
Financing Receivables and Allowances for Credit Losses  
Financing Receivables and Allowances for Credit Losses

5.               Financing Receivables and Allowances for Credit Losses

 

As of June 30, 2011, Batesville had $8.2 of customer notes receivable, primarily representing long-term payment plans negotiated to collect unpaid balances.  These notes generally carry repayment terms up to five years at a weighted average interest rate of 5.4%.  The current portion of these notes, $4.8, is included in trade receivables and the long-term portion, $3.4, is included in other assets in the consolidated balance sheets.  We evaluate the recoverability of each note receivable quarterly and record allowances based upon the customer’s credit score and collection experience.  Of the $8.2 notes receivable, $5.5 was current and $2.7 was over 31 days past due as of June 30, 2011.  Accordingly, we established $0.9 of reserves for notes with a gross balance of $2.0 as of June 30, 2011.   There has not been a significant change in the reserve during the periods presented.  Each quarter we perform a detailed review of all notes upon which a reserve was established to determine whether any amounts should be charged off.  Amounts are charged off when they are deemed to no longer be collectible.