Oracle 2010 Annual Report Download - page 116

Table of Contents
ORACLE CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
May 31, 2011
9. RESTRUCTURING ACTIVITIES
Sun Restructuring Plan
During the third quarter of fiscal 2010, our management approved, committed to and initiated a plan to restructure our operations due to our acquisition of Sun
(the Sun Restructuring Plan) in order to improve the cost efficiencies in our merged operations. Our management subsequently amended the Sun Restructuring
Plan to reflect additional actions that we expect to take to improve the cost efficiencies in our merged operations. The total estimated restructuring costs
associated with the Sun Restructuring Plan are $1.0 billion consisting primarily of employee severance expenses, abandoned facilities obligations and contract
termination costs. The restructuring costs will be recorded to the restructuring expense line item within our consolidated statements of operations as they are
recognized. We recorded $439 million and $342 million of restructuring expenses in connection with the Sun Restructuring Plan in fiscal 2011 and 2010,
respectively, and we expect to incur the majority of the approximately $250 million of remaining expenses pursuant to the Sun Restructuring Plan through fiscal
2012. Any changes to the estimates of executing the Sun Restructuring Plan will be reflected in our future results of operations.
Other Restructuring Plans
Included in the other restructuring plans line in the fiscal 2011 and 2010 activity tables, and total restructuring plans line in the fiscal 2009 activity table, below
are our Fiscal 2009 Oracle Restructuring Plan (the 2009 Plan) and certain restructuring plans that relate to companies that we acquired prior to our adoption of
the revised business combinations accounting guidance contained in ASC 805 as of the beginning of fiscal 2010. The total estimated restructuring costs
associated with the 2009 Plan are recorded to the restructuring expense line item within our consolidated statements of operations as they are recognized whereas
costs related to acquired companies related restructuring plans were originally recognized as liabilities assumed in each of the respective business combinations
and included in the allocation of the cost to acquire these companies and, accordingly, have resulted in an increase to goodwill. Our restructuring expenses may
change as our management executes the approved plans. Future decreases to the estimates of executing these acquisition related restructuring plans will be
recorded as an adjustment to goodwill indefinitely. Increases to the estimates of the acquisition related restructuring plans will be recorded to operating expenses.
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Source: ORACLE CORP, 10-K, June 28, 2011 Powered by Morningstar® Document Research℠