Company: OFIX
Filing Date: 2025-02-25
Form Type: 10-K
Source: 0000950170-25-026066
Chunk: 61

Company: Orthofix Medical Inc.
Filing Date: 2025-02-25
Form: 10-K
Item: Item 16
Chunk 61
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 due is generally not significant.The Company’s allowance for expected credit losses represents the portion of the receivable’s amortized cost basis that an entity does not expect to collect over the receivable’s contractual life, considering past events, current conditions, and reasonable and supportable forecasts of future economic conditions.The process for estimating the ultimate collection of accounts receivable involves certain assumptions and judgments. The determination of the contractual life of accounts receivable, the aging of outstanding receivables, as well as the historical collections, write-offs, and payor reimbursement experience over the estimated contractual lives of such receivables, are integral 

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parts of the estimation process related to reserves for expected credit losses and the establishment of contractual allowances. Accounts receivable are analyzed on a quarterly basis to assess the adequacy of both reserves for expected credit losses and contractual allowances. Revisions in allowances for expected credit loss estimates are recorded as an adjustment to bad debt expense within sales, general, and administrative expenses. Revisions to contractual allowances are recorded as an adjustment to net sales. These estimates are periodically tested against actual collection or adjustment experience. In addition, the Company analyzes its receivables by geography and by customer type, where appropriate, in developing estimates for expected credit losses.The following table provides the detail of changes in the Company’s allowance for expected credit losses for the years ended December 31, 2024, and 2023:

        For the year ended December 31,

        (U.S. Dollars, in thousands)
         
        2024

        2023

        Allowance for expected credit losses beginning balance
         
        $
        7,130

        $
        6,419

        Addition resulting from the Merger with SeaSpine

        —

        137

        Current period provision for expected credit losses

        1,999

        820

        Write-offs charged against the allowance and other

        (1,451
        )

        (381
        )

        Effect of changes in foreign exchange rates

        (260
        )

        135

        Allowance for expected credit losses ending balance
         
        $
        7,418

        $
        7,130

      The Company will generally sell receivables from certain Italian public hospitals each year to accelerate cash collections. During 2024, 2023, and 2022, the Company sold €7.9 million, €9.2 million, and €9.2 million ($8.5