IBM 2000 Annual Report Download - page 80

LOTHER LIABILITIES
(dollars in millions)
AT DECEMBER 31: 2000 1999
Nonpension postretirement
benefits — U.S. and
non-U.S. employees $«««7,128 $«««7,420
Deferred income taxes 1,623 1,354
Deferred income 1,266 1,081
Restructuring actions 854 1,162
Executive compensation accruals 769 746
Post-employment/
pre-retirement liability 585 710
Environmental accruals 226 228
Other 497 581
Total $«12,948 $«13,282
Post-employment/pre-retirement liabilities represent work-
force accruals for contractually obligated payments to
employees terminated in the ongoing course of business
other than those accruals presented separately above.
The company executed restructuring actions through
1993 and special actions in 1999. The non-current liabilities
relating to these actions are included in restructuring actions
in the table above. See note Q, “1999 Actions,” on pages 81
and 82 for more information regarding the 1999 actions.
The reconciliation of the December 31, 1999 to 2000
balances of the current and non-current liabilities for
restructuring actions are presented below. The current
liabilities presented in the table are included in Other
accrued expenses and liabilities on the Consolidated State-
ment of Financial Position.
December 31, December 31,
1999 Other 2000
(dollars in millions) Balance Payments Adjustments*Balance
Current:
Workforce $««««188 $«178 $««138 $«148
Space 144 126 73 91
MiCRUS
Investment 152 152 — —
Total $««««484 $«456 $««211 $«239
Non-current:
Workforce $«0,659 $«««— $«(189) $«470
Space 503 — (119) 384
Total $«1,162 $«««— $«(308) $«854
*Principally represents reclassification of non-current to current and currency
translation adjustments.
The workforce accruals relate to terminated employees
who are no longer working for the company, but who were
granted annual payments to supplement their state pensions
in certain countries. These contractually required payments
will continue until the former employee dies.
The space accruals are for ongoing obligations to pay
rent for vacant space that could not be sublet or space that
was sublet at rates lower than the committed lease arrange-
ment. The length of these obligations varies by lease with
the longest extending through 2012.
The company employs extensive internal environmental
protection programs that primarily are preventive in nature.
The cost of these ongoing programs is recorded as incurred.
The company continues to participate in environmental
assessments and cleanups at a number of locations, including
operating facilities, previously owned facilities and Superfund
sites. The company accrues for all known environmental
liabilities when it becomes probable that the company will
incur cleanup costs, and those costs can reasonably be esti-
mated. In addition, estimated environmental costs that are
associated with post-closure activities (for example, the
removal and restoration of chemical storage facilities and
monitoring) are accrued when the decision is made to close
a facility. The total amounts accrued, including amounts
classified as current on the Consolidated Statement of
Financial Position, that do not reflect actual or anticipated
insurance recoveries, were $248 million and $240 million at
December 31, 2000 and 1999, respectively.
The amounts accrued do not cover sites that are in the
preliminary stages of investigation; that is, for which neither
the company’s percentage of responsibility nor the extent of
cleanup required has been identified. Estimated environ-
mental costs are not expected to materially affect the
financial position or results of the company’s operations in
future periods. However, estimates of future costs are subject
to change due to protracted cleanup periods and changing
environmental remediation regulations.
notes to consolidated financial statements
international business machines corporation
and Subsidiary Companies
page no.
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