Annual report pursuant to Section 13 and 15(d)

ACCOUNTS RECEIVABLE

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ACCOUNTS RECEIVABLE
12 Months Ended
Jan. 02, 2021
Receivables [Abstract]  
ACCOUNTS RECEIVABLE ACCOUNTS RECEIVABLE
The following table presents components of accounts receivable, net of allowance for doubtful accounts:
(In thousands) December 2020 December 2019
Trade $ 242,451  $ 230,588 
Royalty and other 8,089  9,723 
Total accounts receivable 250,540  240,311 
Less: allowance for doubtful accounts (19,143) (11,852)
Accounts receivable, net $ 231,397  $ 228,459 
Allowance for Doubtful Accounts
The Company reviews the estimates used to calculate the allowance for doubtful accounts on a quarterly basis. At December 2020, the Company updated its evaluation of expected losses and related assumptions used in the allowance for doubtful accounts, including the impact of COVID-19.
The following table presents a rollforward of the allowance for doubtful accounts:
(In thousands) Year Ended December 2020
Balance, December 2019 $ 11,852 
Provision for expected credit losses 18,338 
Accounts receivable balances written off (1)
(11,877)
Other (2)
830 
Balance, December 2020 $ 19,143 
(1) Accounts receivable balances written off against the allowance were primarily due to the bankruptcy of a major U.S. retail customer during the second quarter of 2020 as well as the impact of COVID-19.
(2) Other primarily includes the impact of foreign currency translation and recoveries of amounts previously written off, none of which were individually significant.
Sale of Trade Accounts Receivable
On April 1, 2019, the Company entered into an agreement with a financial institution to sell selected trade accounts receivable on a nonrecourse basis. Under this agreement, up to $377.5 million of the Company’s trade accounts receivable may be sold to the financial institution and remain outstanding at any point in time. The Company removes the sold balances from "accounts receivable, net" in its balance sheet at the time of sale. The Company does not retain any interests in the sold trade accounts receivable but continues to service and collect outstanding trade accounts receivable on behalf of the financial institution.
Prior to April 1, 2019, the Company had a separate agreement with VF, pursuant to which the Company’s trade accounts receivable were sold as part of VF’s agreement with a financial institution. Under this agreement, the Company did not retain any interests in the sold trade accounts receivable but continued to service and collect outstanding trade accounts receivable on behalf of VF. Prior to the Separation, the amount due from VF for these sales was separately reflected in the Company's balance sheet within "due from former parent." As discussed in Note 22 to the Company's financial statements, all amounts were settled at the Separation date.
During 2020, 2019 and 2018, the Company sold total trade accounts receivable of $981.9 million, $1,035.4 million and $1,057.0 million, respectively. As of December 2020 and December 2019, $127.1 million and $188.1 million, respectively, of the sold trade accounts receivable had been removed from the Company's balance sheets but remained outstanding with the financial institution.
The funding fees charged by the financial institution for these programs are reflected in the Company's statements of operations within "other expense, net" and were $2.0 million, $5.3 million and $5.1 million in 2020, 2019 and 2018, respectively. Net proceeds of these programs are reflected as operating activities in the Company's statements of cash flows.