Honeywell 2011 Annual Report Download - page 71

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In 2010, we recognized repositioning charges totaling $179 million including severance costs of $144 million related to workforce reductions of 2,781
manufacturing and administrative positions primarily in our Automation and Control Solutions, Aerospace and Transportation Systems segments. The
workforce reductions were primarily related to the planned shutdown of certain manufacturing facilities in our Automation and Control Solutions and
Transportation Systems segments, cost savings actions taken in connection with our ongoing functional transformation and productivity initiatives, factory
transitions in our Aerospace, Automation and Control Solutions and Performance Materials and Technologies segments to more cost-effective locations,
achieving acquisition-related synergies in our Automation and Control Solutions segment, and the exit and/or rationalization of certain product lines in our
Performance Materials and Technologies segment. The repositioning charge also included asset impairments of $21 million principally related to
manufacturing plant and equipment associated with the exit and/or rationalization of certain product lines and in facilities scheduled to close. Also, $30
million of previously established accruals, primarily for severance at our Automation and Control Solutions, Transportation Systems and Aerospace segments,
were returned to income in 2010 due to fewer employee separations than originally planned associated with prior severance programs.
In 2009, we recognized repositioning charges totaling $213 million primarily for severance costs related to workforce reductions of 4,145
manufacturing and administrative positions mainly in our Automation and Control Solutions, Transportation Systems and Aerospace segments. The
workforce reductions were primarily related to the adverse market conditions experienced by many of our businesses, cost savings actions taken in connection
with our ongoing functional transformation initiative, the planned downsizing or shutdown of certain manufacturing facilities, and organizational realignments
of portions of our Aerospace and Transportation Systems segments. Also, $53 million of previously established accruals, primarily for severance at our
Automation and Control Solutions, Aerospace, and Transportation Systems segments, were returned to income in 2009 due to fewer employee separations
than originally planned associated with prior severance programs and changes in the scope of previously announced repositioning actions.
The following table summarizes the status of our total repositioning reserves:
Severance
Costs Asset
Impairments Exit
Costs Total
Balance at December 31, 2008 $ 358 $ — $ 36 $ 394
2009 charges 197 6 10 213
2009 usage - cash (186) — (7) (193)
2009 usage - noncash — (6) — (6)
Adjustments (51) — (2) (53)
Divestitures(1) (24) — — (24)
Balance at December 31, 2009 294 — 37 331
2010 charges 144 21 14 179
2010 usage - cash (130) — (17) (147)
2010 usage - noncash — (21) — (21)
Adjustments (30) — — (30)
Foreign currency translation (8) — — (8)
Balance at December 31, 2010 270 — 34 304
2011 charges 246 86 48 380
2011 usage - cash (136) — (23) (159)
2011 usage - noncash — (86) — (86)
Adjustments (26) — — (26)
Foreign currency translation (1) — — (1)
Balance at December 31, 2011 $ 353 $ — $ 59 $ 412
(1) Relates to businesses divested during 2009 included in Gain on Sale of Non-Strategic Businesses and Assets see Note 4, Other (Income) Expense.
Certain repositioning projects in our Aerospace, Automation and Control Solutions and Transportation Systems segments included exit or disposal
activities, the costs related to which will be recognized in future periods when the actual liability is incurred. The nature of these exit or disposal costs
includes asset set-up and moving, product recertification and requalification, and employee retention, training and travel. The following tables
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