Annual report pursuant to Section 13 and 15(d)

Accounts Receivable Accounts Receivable

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Accounts Receivable Accounts Receivable
 12 Months Ended
Dec. 31, 2019
Accounts Receivable [Abstract]  
Accounts Receivable
Accounts Receivable
The Company offers an installment payment option in all of our markets other than Japan (known as Easy-Pay for the QVC brand in the U.S. and the U.K.; Q-Pay in Germany and Italy and FlexPay for the HSN brand). The installment payment option permits customers to pay for items in two or more installments. When the installment payment option is offered by QVC and elected by the customer, the first installment is typically billed to the customer's credit card upon shipment. Generally, the customer's account is subsequently billed in additional monthly installments until the total purchase price of the products has been billed by the Company.
In 2014, the Company amended and restated its agreement with a large consumer financial services company (the "Bank") pursuant to which the Bank provides revolving credit directly to QVC's customers for the sole purpose of purchasing merchandise or services with a private label credit card ("PLCC") company in the U.S. The agreement with the Bank was amended and restated in March 2017 and December 2018 and related to its QVC brand. In December 2018, the Company entered into a separate agreement with the Bank for its HSN brand. The Company receives a portion of the net economics of the credit card program. The Company cannot predict the extent to which customers will use the PLCC, nor the extent that they will make payments on their outstanding balances, PLCC income of $124 million and $118 million was recorded in net revenue during the years ended December 31, 2019 and 2018, respectively. Prior to the adoption of ASC 606, PLCC income was included as a reduction of selling, general and administrative expenses, which amounted to $105 million in 2017.
The Company also accepts major credit cards for its sales. Accounts receivable from major credit cards represents amounts owed to QVC from the credit card clearing houses for amounts billed but not yet collected.
Accounts receivable consisted of the following:
December 31,
 
(in millions)
2019

2018

Installment payment option
$
1,586

1,533

Major credit cards and customers
247

269

Other receivables
103

97

 
1,936

1,899

Less allowance for doubtful accounts
(123
)
(112
)
Accounts receivable, net
$
1,813

1,787


A summary of activity in the allowance for doubtful accounts was as follows:
(in millions)
Balance
beginning
of year

Additions-
charged
to expense

Deductions-
write-offs

Balance
end of
year

2019
$
112

124

(113
)
123

2018
91

112

(91
)
112

2017
97

72

(78
)
91


The carrying value of accounts receivable, adjusted for the reserves described above, approximates fair value as of December 31, 2019, 2018 and 2017