Kodak 2007 Annual Report Download - page 92

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The following assets and liabilities, related to the Health Group business, were segregated and included in current and non-current Assets of discontinued
operations and Liabilities of discontinued operations, as appropriate, in the Consolidated Statement of Financial Position at December 31, 2006.
As of December 31,
(in millions) 2006
Receivables, net $ 597
Inventories, net 201
Other current assets 13
Current assets of discontinued operations $ 811
Property, plant and equipment, net 240
Goodwill 612
Other long-term assets 216
Noncurrent assets of discontinued operations $ 1,068
Current liabilities of discontinued operations $ 431
Pension and other postretirement liabilities 30
Other long-term liabilities 10
Noncurrent liabilities of discontinued operations $ 40
HPA
On October 17, 2007, the shareholders of Hermes Precisa Pty. Ltd. (“HPA”), a majority owned subsidiary of Kodak (Australasia) Pty. Ltd., a wholly owned
subsidiary of the Company, approved an agreement to sell all of the shares of HPA to Salmat Limited. HPA, a publicly traded Australian company, is a
provider of outsourced services in business communication and data processes and was formerly reported within the Company’s Graphic Communica-
tions Group segment.
The sale was approved by the Federal Court of Australia on October 18, 2007, and closed on November 2, 2007. Kodak received $139 million in cash at
closing for its shares of HPA, and recognized a pre-tax gain on the sale of $123 million. The assets and liabilities held-for-sale were not material in any
period presented.
2006
Earnings from discontinued operations for the year ended December 31, 2006 were primarily related to the operations of the Health Group segment.
Interest expense allocated to discontinued operations totaled $90 million for the year.
2005
Earnings from discontinued operations for the year ended December 31, 2005 were primarily related to the operations of the Health Group segment.
Interest expense allocated to Health Group discontinued operations totaled $72 million for the year.
During the fourth quarter of 2005, the Company was informed that the United States Congress Joint Committee on Taxation had approved, and the Inter-
nal Revenue Service had signed, a settlement between the Company and the Internal Revenue Service concerning the audit of the tax years 1993-1998.
As a result of the settlement, the Company was able to reverse certain tax accruals of approximately $203 million, which were established in 1994 in con-
nection with the sale of Sterling Winthrop Inc., the Company’s pharmaceutical, consumer health, and household products businesses at that time. These
tax accrual reversals were recognized in earnings from discontinued operations for the year ended December 31, 2005.
On August 13, 2004 the Company completed the sale of the assets and business of the Remote Sensing Systems operation, including the stock of
Kodak’s wholly owned subsidiary, Research Systems, Inc. (collectively known as RSS), to ITT Industries for $725 million in cash. As a result of the sale
of RSS, the Company transferred the related employees’ plan assets from the Company’s pension plan. This transfer was subject to a true-up provision,
which was completed in the fourth quarter of 2005 and resulted in a settlement loss of $54 million being recognized in earnings from discontinued opera-
tions for the year ended December 31, 2005.