Avon 2012 Annual Report Download - page 108

Of the total costs to implement, $71.2 was recorded in selling, general and administrative expenses and $9.5 was recorded in cost of sales
for 2010.
Restructuring Charges – 2011
During 2011, we recorded total costs to implement of $40.0 associated with previously approved initiatives that are part of our 2005 and
2009 Restructuring Programs, and the costs consisted of the following:
• net charge of $3.4 primarily for employee-related costs, including severance and pension benefits;
• implementation costs of $27.2 for professional service fees, primarily associated with our initiatives to outsource certain finance processes and
realign certain distribution operations, realign certain support functions to a more regional basis and realign certain manufacturing facilities;and
• accelerated depreciation of $14.6 associated with our initiatives to realign certain distribution operations and close certain manufacturing
operations, offset by a net gain of $5.2 primarily due to the sale of a facility in Germany.
Of the total costs to implement, $28.8 was recorded in selling, general and administrative expenses and $11.2 was recorded in cost of sales
for 2011.
Restructuring Charges – 2012
During 2012, we recorded total costs to implement of $.1 associated with previously approved initiatives that are part of our 2005 and 2009
Restructuring Programs, and the costs consisted of the following:
• net benefit of $12.1 as a result of adjustments to the reserve, partially offset by employee-related costs;
• implementation costs of $8.9 for professional service fees, primarily associated with our initiatives to outsource certain finance processes
and realign certain distribution operations; and
• accelerated depreciation of $4.7 associated with our initiatives to realign certain distribution operations and close certain manufacturing
operations, offset by a net gain of $1.4 due to the sale of machinery and equipment in Germany.
Of the total cost to implement, a net benefit of $3.0 was recorded in selling, general and administrative expenses and total costs to
implement of $3.1 were recorded in cost of sales for 2012.
The liability balances, which primarily consist of employee-related costs, for the initiatives under the 2005 and 2009 Restructuring Programs
are shown below:
Total
Balance December 31, 2009 $149.0
2010 Charges 64.6
Adjustments (23.3)
Cash payments (49.2)
Non-cash write-offs (1.7)
Foreign exchange (3.5)
Balance December 31, 2010 $135.9
2011 Charges 25.6
Adjustments (22.2)
Cash payments (64.1)
Non-cash write-offs .3
Foreign exchange (1.6)
Balance December 31, 2011 $ 73.9
2012 Charges 2.3
Adjustments (14.4)
Cash payments (41.5)
Non-cash write-offs 1.0
Foreign exchange (.3)
Balance December 31, 2012 $ 21.0
Non-cash write-offs associated with employee-related costs are the result of settlement, curtailment and special termination benefit charges
for pension plans and postretirement due to the initiatives implemented.
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