Philip Morris International Inc. (NYSE:PM)

Analysis of Bad Debts

Allowance for doubtful accounts receivable (bad debts) is a contra account which reduce the balance of the company gross accounts receivable. The relationship between the allowance and the balance in receivables should be relatively constant unless there is a change in the economy overall or a change in customer base.

Allowance for Doubtful Accounts Receivable

Allowance for Doubtful Accounts Receivable

	Dec 31, 2023	Dec 31, 2022	Dec 31, 2021	Dec 31, 2020	Dec 31, 2019
Selected Financial Data (US$ in millions)
Allowances	79)	42)	70)	23)	20)
Trade receivables, gross	3,540)	3,892)	3,193)	2,928)	3,100)
Financial Ratio
Allowance as a percentage of trade receivables, gross¹	2.23%	1.08%	2.19%	0.79%	0.65%

Based on: 10-K (reporting date: 2023-12-31), 10-K (reporting date: 2022-12-31), 10-K (reporting date: 2021-12-31), 10-K (reporting date: 2020-12-31), 10-K (reporting date: 2019-12-31).

¹ 2023 Calculation
Allowance as a percentage of trade receivables, gross = 100 × Allowances ÷ Trade receivables, gross
= 100 × 79 ÷ 3,540 = 2.23%

Financial ratio	Description	The company
Allowance as a percentage of trade receivables, gross	Allowance for doubtful accounts divided by the gross accounts receivable.	Philip Morris International Inc. allowance as a percentage of trade receivables, gross decreased from 2021 to 2022 but then increased from 2022 to 2023 exceeding 2021 level.