21. Trade receivables and unbilled services

Trade receivables are initially recognised at fair value, and subsequently measured at amortised cost (if the time value is material), using the effective interest method, less allowance for expected credit losses. To measure the expected credit losses, trade receivables have been grouped based on shared credit risk characteristics and the days past due.

The expected credit losses on trade receivables are estimated collectively using a provision matrix based on TMF Group's historical credit loss experience and includes an assessment of the forecast direction of macroeconomic conditions at reporting date.

Provision rates are segregated according to geographical location and status of the client (active/inactive) and credit risk category (local/global). The carrying amount of the assets is reduced through the use of an allowance account, and the amount of the loss is recognised in the income statement within ‘Impairment financial assets’. When a receivable is uncollectable, it is written off against the allowance account.

Subsequent recoveries of amounts previously written off are credited against ‘Impairment financial assets’ in the income statement. Unbilled services relate to services performed but not yet billed.

The breakdown of total trade receivables and unbilled services is:

The maximum exposure of credit risk at the reporting date is the carrying value of the receivables. TMF Group does not hold any collateral as security. TMF Group has no significant concentrations of credit risk.

The ageing analysis of trade receivables net of the allowance for credit losses is as follows as per 31 December 2023:

Trade receivables are non-interest bearing and are generally on terms of 14 to 45 days.

Breakdown of movements in the allowance, based on expected credit losses, are as follows:

TMF Group evaluates the concentration of risk with respect to trade receivables as very low due to international landscape, scale, and scope of subsidiaries, as its customers are located in several jurisdictions and industries and operate in largely independent markets.

The carrying amounts of TMF Group's total Trade receivables and Unbilled services are denominated in the following currencies:

Currencies categorised as “Other” are individually below €2 million.