ManpowerGroup 2009 Annual Report Download - page 50

Notes To Consolidated Financial Statements
in millions, except share and per share data
48 Manpower 2009 Annual Report Notes to Consolidated Financial Statements
ADVERTISING COSTS
We expense production costs of advertising as they are incurred. Advertising expenses were $29.4, $62.6 and $69.5 in
2009, 2008 and 2007, respectively.
EMPLOYMENT-RELATED ITEMS
During 2007, we were notifi ed by the French government of a modifi cation to the calculation of payroll taxes under certain
French social programs aimed at encouraging the employment of low-wage workers. This modifi cation reduced the amount
of payroll taxes that we were required to remit related to the period from January 1, 2006 through October 1, 2007. Included
in 2007 is $149.6 ($88.6 after tax) of net benefi t related to this modifi cation, including an increase to Gross Profi t of $157.1
and an increase to Selling and Administrative Expenses of $7.5. The proceeds related to this modifi cation were reimbursed to
us in 2008 and 2007.
In April 2008, we received additional information, which was based on communications with the French Central Agency,
indicating that this modifi cation was also applicable to 2005. Therefore, we recognized $68.2 ($43.8 after tax) of a net benefi t
to Gross Profi t in 2008 related to this modifi cation. The proceeds for a majority of 2005 were received in 2008 with the
remainder in 2009.
REORGANIZATION COSTS
We recorded reorganization costs of $33.5, $37.2 and $8.4 in 2009, 2008 and 2007, respectively, in Selling and Administrative
Expenses, primarily related to severances as well as offi ce closures and consolidations in several countries. As of December
31, 2009, $57.8 has been paid out of these reserves, of which $43.2 was paid during 2009. We expect a majority of the
remaining $21.2 will be paid or utilized in 2010. Changes in the restructuring liability balances for each reportable segment
and Corporate are as follows:
Americas France EMEA(1) Asia Pacifi c
Right
Management
Jefferson
Wells Corporate Total
Balance, December 31, 2007 $ – $ 4.4 $ – $ – $ – $ 3.9 $ – $ 8.3
Severance costs 2.1 – 12.2 0.4 – 5.2 0.2 20.1
Offi ce closure costs 0.9 2.7 9.0 0.4 1.5 2.6 – 17.1
Costs paid or utilized (0.6) (2.6 ) (5.0) (0.7) (0.5) (5.2) – (14.6)
Balance, December 31, 2008 2.4 4.5 16.2 0.1 1.0 6.5 0.2 30.9
Severance costs 1.5 – 11.8 1.9 – 4.3 0.9 20.4
Offi ce closure costs 0.6 5.6 3.9 0.7 – 2.3 – 13.1
Costs paid or utilized (3.1) (4.4) (22.4) (1.2) (0.6) (10.4) (1.1) (43.2)
Balance, December 31, 2009 $ 1.4 $ 5.7 $ 9.5 $ 1.5 $ 0.4 $ 2.7 $ – $ 21.2
(1) 2008 amounts related to Italy were $0.6 for offi ce closure costs, resulting in a $0.6 restructuring liability for the year ended December 31, 2008. In 2009, Italy
incurred $4.1 for severance costs and $0.8 for offi ce closure costs and paid $5.5, leaving no restructuring liability as of December 31, 2009.
INCOME TAXES
We account for income taxes in accordance with the accounting guidance on income taxes. Deferred tax assets and liabilities
are recognized for the future tax consequences attributable to differences between fi nancial statement carrying amounts of
existing assets and liabilities and their respective tax basis, and net operating loss and tax credit carryforwards. Deferred tax
assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those
temporary differences are expected to be recovered or settled. We record a valuation allowance against deferred tax assets
for which utilization of the asset is not likely.