Annual report pursuant to Section 13 and 15(d)


12 Months Ended
Dec. 31, 2022
Inventory Disclosure [Abstract]  
Inventory Inventory
Inventory consisted of the following (in millions):
As of December 31,
2022 2021
Completed VOI inventory
$ 982  $ 998 
Estimated VOI recoveries 192  187 
VOI construction in process 14  13 
Vacation exchange credits and other
Land held for VOI development
Inventory sold subject to repurchase
—  13 
Total inventory $ 1,193  $ 1,216 

As VOI inventory is completed it is transferred into property and equipment until such units are registered and made available for sale. Once registered and available for sale, the units are then transferred back into completed inventory. The Company had net transfers of VOI inventory to property and equipment of $19 million and $75 million during 2022 and 2021.

During 2020, as a result of resort closures and cancellations surrounding COVID-19, the Company recorded a $48 million reduction to exchange inventory consisting of costs previously incurred by RCI to provide enhanced out-of-network travel options to members. The write-off was included within Operating expenses on the Consolidated Statements of Income/(Loss). The Company utilized the remaining inventory to maximize exchange supply for its members.

Inventory Obligations
The Company has entered into inventory sale transactions with third-party developers for which the Company has conditional rights and obligations to repurchase the completed properties from the developers subject to the properties conforming to the Company’s vacation ownership resort standards and provided that the third-party developers have not sold the properties to another party. Under the sale of real estate accounting guidance, the conditional rights and obligations of the Company constitute continuing involvement and thus the Company was unable to account for these transactions as a sale.
The following table summarizes the activity related to the Company’s inventory obligations (in millions):
Atlanta (a) (b)
Las Vegas (a)
Moab (a)
Orlando (a)
Other (c)
December 31, 2020 $ —  $ 13  $ 31  $ 22  $ 17  $ 83 
Purchases —  25  70  99 
Payments —  (2) (56) (24) (86) (168)
December 31, 2021 —  13  —  —  14 
Purchases 67  52  —  —  56  175 
Payments (67) (35) —  —  (50) (152)
December 31, 2022 $ —  $ 30  $ —  $ —  $ $ 37 
(a)Included in Accrued expenses and other liabilities on the Consolidated Balance Sheets.
(b)Represents vacation ownership inventory and property and equipment in Atlanta, Georgia, acquired from a third-party developer.
(c)Included in Accounts payable on the Consolidated Balance Sheets.

In connection with an inventory sale transaction, the Company has committed to repurchase completed property located in Las Vegas, Nevada, from a third-party developer. The maximum potential future payments that the Company may be required to make under this commitment was $30 million as of December 31, 2022.