2. Sale of Accounts Receivable The Company sells its accounts receivable to a nonconsolidated multi-seller securitization vehicle and receives proceeds that consist of cash and a beneficial interest in the transferred receivables (which is classified as an available-for-sale security). The Company uses securitization as a financing technique (e.g., to reduce more expensive bank debt the interest cost on the securitization financing is less than the Company could get on its own bank debt). The Company services, administers, and collects the receivables on behalf of the purchaser. The agreement includes certain covenants and provides for various events of termination. The agreement also requires that proceeds from securitization be used to pay down Company debt. During the current year, $11 million of receivables generated from sales of the Companys inventory were sold under the agreement. Assume that the sale of receivables qualifies for derecognition under ASC 860, Transfers and Servicing (formerly FASB Statement No. 140, Accounting for Transfers and Servicing of Financial Assets and Extinguishments of Liabilities, as amended by Statement 166); therefore, the sold receivables are not reflected in the accounts receivable balance in the Companys balance sheet