Western Union 2010 Annual Report Download - page 92

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All stock-based compensation to employees is required to be measured at fair value and expensed over the
requisite service period and also requires an estimate of forfeitures when calculating compensation expense. The
Company recognizes compensation expense on awards on a straight-line basis over the requisite service period for
the entire award. Refer to Note 16 for additional discussion regarding details of the Company’s stock-based
compensation plans.
Restructuring and Related Expenses
The Company records severance-related expenses once they are both probable and estimable in accordance with
the provisions of the applicable accounting guidance for severance provided under an ongoing benefit arrangement.
One-time, involuntary benefit arrangements and other exit costs are generally recognized when the liability is
incurred. Expenses arising under the Company’s defined benefit pension plans from curtailing future service of
employees participating in the plans and providing enhanced benefits are recognized in earnings when it is probable
and reasonably estimable. The Company also evaluates impairment issues associated with restructuring activities
when the carrying amount of the assets may not be fully recoverable, in accordance with the appropriate accounting
guidance. Restructuring and related expenses consist of direct and incremental expenses associated with
restructuring and related activities, including severance, outplacement and other employee related benefits;
facility closure and migration of the Company’s IT infrastructure; and other expenses related to the relocation
of various operations to new or existing Company facilities and third-party providers, including hiring, training,
relocation, travel and professional fees. Also included in the facility closure expenses are non-cash expenses related
to fixed asset and leasehold improvement write-offs and the acceleration of depreciation and amortization. For more
information on the Company’s restructuring and related expenses see Note 3.
3. Restructuring and Related Expenses
2010 Plan
On May 25, 2010 and as subsequently revised, the Company’s Board of Directors approved a restructuring plan
(the “Restructuring Plan”) designed to reduce the Company’s overall headcount and migrate positions from various
facilities, primarily within the United States and Europe, to regional operating centers. Details of the estimated
expenses are included in the tables below. Included in these estimated expenses are approximately $2 million of
non-cash expenses related to fixed asset and leasehold improvement write-offs and accelerated depreciation at
impacted facilities. Subject to complying with and undertaking the necessary individual and collective employee
information and consultation obligations as may be required by local law for potentially affected employees, the
Company expects all of these activities to be completed by the end of the third quarter of 2011. The foregoing
figures are the Company’s estimates and are subject to change as the Restructuring Plan continues to be
implemented.
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