Castelo sells agricultural equipment to a distributor in a region where it has a practice of accepting settlements below the invoiced price, to preserve the business relationship. For a contract of quarterly deliveries over two years, it expects (documented judgement, case datum) to accept about 90% of the contractual price; the distributor has the ability and intention to pay that amount. One year later, the distributor's bank withdraws its credit lines and its payment delays build up. The finance director asks you for a position memo on the assessment of collectability at inception and after this event.