Kodak 2011 Annual Report Download - page 31

before special termination benefits, curtailments and settlements for the major funded and unfunded non-U.S. defined benefit pension plans is projected
to increase from $43 million in 2011 to approximately $67 million in 2012.
Additionally, the Company expects the expense, before curtailment and settlement gains and losses of its major other postretirement benefit plans, to be
approximately $5 million in 2012 as compared with expense of $20 million for 2011. The decrease is due primarily to an expected decrease in interest
expense.
Benefit plans in the U.S. are subject to the bankruptcy proceedings.
Environmental Commitments
Environmental liabilities are accrued based on undiscounted estimates of known environmental remediation responsibilities. The liabilities include
accruals for sites owned or leased by the Company, sites formerly owned or leased by the Company, and other third party sites where the Company
was designated as a potentially responsible party (“PRP”). The amounts accrued for such sites are based on these estimates, which are determined
using the ASTM Standard E 2137-06, “Standard Guide for Estimating Monetary Costs and Liabilities for Environmental Matters.” The overall
method includes the use of a probabilistic model that forecasts a range of cost estimates for the remediation required at individual sites. The
Company’s estimate includes equipment and operating costs for investigations, remediation and long-term monitoring of the sites. Such estimates
may be affected by changing determinations of what constitutes an environmental liability or an acceptable level of remediation. The Company’s
estimate of its environmental liabilities may also change if the proposals to regulatory agencies for desired methods and outcomes of remediation are
viewed as not acceptable, or additional exposures are identified. The Company has an ongoing monitoring process to assess how activities, with
respect to the known exposures, are progressing against the accrued cost estimates.
Additionally, in many of the countries in which the Company operates, environmental regulations exist that require the Company to handle and
dispose of asbestos in a special manner if a building undergoes major renovations or is demolished. The Company records a liability equal to the
estimated fair value of its obligation to perform asset retirement activities related to the asbestos, computed using an expected present value technique,
when sufficient information exists to calculate the fair value.
RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS
See Note 2, “Significant Accounting Policies,” in the Notes to Financial Statements in Item 8.
KODAK OPERATING MODEL AND REPORTING STRUCTURE
For 2011, the Company had three reportable segments: CDG, GCG, and FPEG. Within each of the Company’s reportable segments are various
components, or Strategic Product Groups (“SPGs”). Throughout the remainder of the MD&A, references to the segments’ SPGs are indicated in
italics. The balance of the Company's continuing operations, which individually and in the aggregate do not meet the criteria of a reportable segment,
are reported in All Other. A description of the segments is as follows:
Consumer Digital Imaging Group Segment (“CDG”): This segment provides a full range of digital imaging products and service offerings to
consumers. CDG encompasses the following SPGs. Products and services included within each SPG are identified below.
Digital Capture and Devices
includes digital still and pocket video cameras, digital picture frames, accessories, branded licensed products, and licensing
activities related to the Company’s intellectual property in digital imaging products. As announced on February 9, 2012, the Company plans to phase out
its dedicated capture devices business, including digital cameras, pocket video cameras, and digital picture frames in the first half of 2012.
Consumer Inkjet Systems includes consumer inkjet printers and related ink and media consumables.
Retail Systems Solutions
includes kiosks, APEX drylab systems, and related consumables and services.
Consumer Imaging Services includes Kodak Gallery products and photo sharing services.
Graphic Communications Group Segment (“GCG”): GCG serves a variety of customers in the creative, in-plant, data center, commercial printing,
packaging, newspaper and digital service bureau market segments with a range of software, media and hardware products that provide customers with a
variety of solutions for prepress equipment, workflow software, analog and digital printing, and document scanning. GCG encompasses the following
SPGs. Products and services included within each SPG are identified below.
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