HP 2010 Annual Report Download - page 112

HEWLETT-PACKARD COMPANY AND SUBSIDIARIES
Notes to Consolidated Financial Statements (Continued)
Note 8: Restructuring Charges (Continued)
Summary of Restructuring Plans
The adjustments to the accrued restructuring expenses related to all of HP’s restructuring plans
described above for the twelve months ended October 31, 2010 were as follows:
As of October 31, 2010
Fiscal Non-cash Total costs Total
Balance, year 2010 settlements Balance, and expected
October 31, charges Cash and other October 31, adjustments costs and
2009 (reversals) payments adjustments 2010 to date adjustments
In millions
Fiscal 2010 acquisitions . . $ — $ 64 $ (20) $ — $ 44 $ 64 $ 88
Fiscal 2010 ES Plan:
Severance ......... $ — $ 630 $ (55) $45 $ 620 $ 630 $ 761
Infrastructure ....... — 20 (6) (10) 4 20 231
Total ES Plan ....... $ — $ 650 $ (61) $35 $ 624 $ 650 $ 992
Fiscal 2009 Plan ....... $ 248 $ (5) $ (177) $ (9) $ 57 $ 292 $ 292
Fiscal 2008 HP/EDS Plan:
Severance ......... $ 747 $ 236 $ (873) $(35) $ 75 $2,146 $2,146
Infrastructure ....... 419 193 (185) (19) 408 693 1,239
Total HP/EDS Plan . . . $1,166 $ 429 $(1,058) $(54) $ 483 $2,839 $3,385
Total restructuring plans . . $1,414 $1,138 $(1,316) $(28) $1,208 $3,845 $4,757
During fiscal 2010, HP had completed payouts of restructuring liabilities associated with previous
restructuring actions and recorded a restructuring charge in fiscal 2010 of $6 million associated with
these actions. At October 31, 2009, HP had $51 million of restructuring liabilities associated with these
actions.
At October 31, 2010 and October 31, 2009, HP included the long-term portion of the restructuring
liability of $297 million and $356 million, respectively, in Other liabilities, and the short-term portion in
Accrued restructuring in the accompanying Consolidated Balance Sheets.
Note 9: Fair Value
HP adopted the provisions related to the fair value of nonfinancial assets and nonfinancial
liabilities in the first quarter of fiscal 2010 for the following major categories of nonfinancial items from
the Consolidated Balance Sheet: Property, plant and equipment; Goodwill; Purchased intangible assets;
Accrued restructuring; and the asset retirement obligations within Other accrued liabilities and Other
liabilities. The provisions of the accounting standard related to measuring fair value and related
disclosures are applied to nonfinancial assets and nonfinancial liabilities whenever they are required to
be measured at fair value, such as when accounting for a business combination, when evaluating and/or
determining impairment, or in accordance with certain other accounting pronouncements. Except for
assets and liabilities acquired in business combinations as discussed in Note 6, HP did not measure any
material nonfinancial assets and nonfinancial liabilities at fair value on a non-recurring basis in fiscal
2010.
Except for the provisions noted above, the accounting standard relating to fair value measurements
and disclosures became effective for HP beginning in fiscal 2009. This standard establishes a new
framework for measuring fair value and expands related disclosures. The framework requires fair value
to be determined based on the exchange price that would be received for an asset or paid to transfer a
liability (an exit price) in the principal or most advantageous market for the asset or liability in an
orderly transaction between market participants.
104