Motorola 2014 Annual Report Download - page 87

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85
The following table displays a rollforward of the reorganization of businesses accruals established for exit costs and
employee separation costs, including those related to discontinued operations which were maintained by the Company after the
sale of the Enterprise business, from January 1, 2013 to December 31, 2013:
Accruals at
January 1 Additional
Charges Adjustments Amount
Used Accruals at
December 31
Exit costs $ 4 $ 3 $ — $ (1) $ 6
Employee separation costs 31 146 (16) (58) 103
$ 35 $ 149 $ (16) $ (59) $ 109
Exit Costs
At January 1, 2013, the Company had an accrual of $4 million for exit costs attributable to lease terminations. There were
$3 million of additional charges in 2013. The $1 million used in 2013 reflects cash payments. The remaining accrual of $6 million,
which is included in Accrued liabilities in the Company’s consolidated balance sheet at December 31, 2013, represents future
cash payments, primarily for lease termination obligations.
Employee Separation Costs
At January 1, 2013, the Company had an accrual of $31 million for employee separation costs, representing the severance
costs for approximately 400 employees. The additional 2013 charges of $146 million represent severance costs for
approximately an additional 2,200 employees, of which 800 were direct employees and 1,400 were indirect employees. The
adjustments of $16 million reflect accruals no longer needed. The $58 million used in 2013 reflects cash payments to these
separated employees, including $20 million related to employees of the Enterprise business and included in cash flow from
discontinued operations. The remaining accrual of $103 million was included in Accrued liabilities in the Company’s consolidated
balance sheet at December 31, 2013.
2012 Charges
The Company recorded net reorganization of business charges of $33 million, including $6 million of charges in Costs of
sales and $27 million of charges in Other charges in the Company’s consolidated statements of operations. Included in the
aggregate $33 million are charges of $35 million for employee separation costs and $5 million for building impairment charges,
partially offset by $7 million of reversals for accruals no longer needed.
The following table displays the net charges incurred by segment:
Year ended December 31 2012
Products $ 22
Services 11
$ 33
The following table displays a rollforward of the reorganization of businesses accruals established for exit costs and
employee separation costs, including those related to discontinued operations which were maintained by the Company after the
sale of the Enterprise business, from January 1, 2012 to December 31, 2012:
Accruals at
January 1 Additional
Charges Adjustments Amount
Used Accruals at
December 31
Exit costs $ 14 $ — $ 1 $ (11) $ 4
Employee separation costs 30 54 (9) (44) 31
$ 44 $ 54 $ (8) $ (55) $ 35
Exit Costs
At January 1, 2012, the Company had an accrual of $14 million for exit costs attributable to lease terminations. The
adjustment of $1 million reflects an adjustment for additional accruals needed. The $11 million used in 2012 reflects cash
payments. The remaining accrual of $4 million, which was included in Accrued liabilities in the Company’s consolidated balance
sheets at December 31, 2012, represented future cash payments, primarily for lease termination obligations.
Employee Separation Costs
At January 1, 2012, the Company had an accrual of $30 million for employee separation costs, representing the severance
costs for approximately 700 employees. The additional 2012 charges of $54 million were severance costs for approximately an
additional 1,000 employees, of which 300 were direct employees and 700 were indirect employees. The adjustments of $9
million reflect accruals no longer required. The $44 million used in 2012 reflects cash payments to these separated employees,
including $20 million related to employees of the Enterprise business and included in cash flow from discontinued operations.
The remaining accrual of $31 million was included in Accrued liabilities in the Company’s consolidated balance sheet at
December 31, 2012.