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Annual Report 2015 Report by the Board of Directors Notes Proposed distribution of earnings Auditor’s report Eleven-year review Quarterly information

Note 17 Trade receivables

All amounts in SEKm unless otherwise stated

  2014 2015
Trade receivables 21,282 18,245
Provisions for impairment of receivables –619 –500
Trade receivables, net 20,663 17,745
Provisions in relation to trade receivables, % 2.9 2.7

Trade receivables are recognized initially at fair value and subsequently measured at amortized cost using the effective interest method, less provision for impairment. The change in amount of the provision is recognized in the income statement in selling expenses. The Group’s policy is to reserve 50% of trade receivables that are 6 months past due but less than 12 months, and to reserve 100% of receivables that are 12 months past due and more. If the provision is considered insufficient due to individual consideration such as bankruptcy, officially known insolvency, etc., the provision should be extended to cover the extra anticipated losses.

Provisions for impairment of receivables

  2014 2015
Provisions, January 1 –536 –619
Acquisition of operations –2
New provisions –185 –78
Actual credit losses 140 164
Exchange-rate differences and other changes –38 35
Provisions, December 31 –619 –500

The fair value of trade receivables equals their carrying amount as the impact of discounting is not significant. Electrolux has a significant credit exposure on a number of major customers, primarily in the US, Latin America and Europe. Receivables concentrated to customers with credit limits amounting to SEK 300m or more represent 29.0% (39.0) of the total trade receivables. The creation and usage of provisions for impaired receivables have been included in selling expenses in the income statement.

Timing analysis of trade receivables past due

  2014 2015
Trade receivables not overdue 19,572 16,865
Less than 2 months overdue 725 636
2–6 months overdue 221 244
6���12 months overdue 145 0
More than 1 year overdue 0
Total trade receivables past due but not impaired 1,091 880
Impaired trade receivables 619 500
Total trade receivables 21,282 18,245
Past due, including impaired, in relation to trade receivables, % 8.0 7.6