Xerox 2011 Annual Report Download - page 82

80
December 31,
(continued) 2011 2010
Other Current Liabilities
Deferred taxes and income taxes payable $ 83 $ 59
Other taxes payable 150 177
Interest payable 84 122
Restructuring reserves 116 309
Derivative instruments 31 19
Product warranties 15 17
Dividends payable 74 74
Distributor and reseller rebates/commissions 112 105
Other 966 925
Total Other Current Liabilities $ 1,631 $ 1,807
Other Long-Term Assets
Prepaid pension costs $ 76 $ 92
Net investment in discontinued operations(1) 204 224
Internal use software, net 545 468
Product software, net 256 145
Restricted cash 246 280
Debt issuance costs, net 38 42
Customer contract costs, net 294 134
Derivative instruments — 11
Deferred compensation plan investments 92 92
Other 365 286
Total Other Long-Term Assets $ 2,116 $ 1,774
Other Long-Term Liabilities
Deferred and other tax liabilities $ 290 $ 200
Environmental reserves 16 20
Unearned income 82 36
Restructuring reserves 7 14
Other 466 527
Total Other Long-Term Liabilities $ 861 $ 797
(1) At December 31, 2011, our net investment in discontinued operations primarily
consisted of a $225 performance-based instrument relating to the 1997 sale of
The Resolution Group (“TRG”) net of remaining net liabilities associated with our
discontinued operations of $21. The recovery of the performance-based instrument is
dependent on the sufficiency of TRG’s available cash flows, as guaranteed by TRG’s
ultimate parent, which are expected to be recovered in annual cash distributions
through 2017. In 2011, the performance-based instrument was pledged as security
for our future funding obligations to our U.K. Pension Plan for salaried employees.
Note 11 – Debt
Short-term borrowings were as follows:
December 31,
2011 2010
Commercial paper $ 100 $ 300
Current maturities of long-term debt 1,445 1,070
Total Short-Term Debt $ 1,545 $ 1,370
The restructuring reserve balance as of December 31, 2011 for all
programs was $123, of which approximately $116 is expected to be
spent over the next 12 months.
2010Activity
During 2010, we recorded $483 of net restructuring and asset impairment
charges, which included the following:
•$470 of severance costs related to headcount reductions of
approximately 9,000 employees. The costs associated with these
actions applied about equally to North America and Europe, with
approximately 20% related to our developing market countries.
Approximately 50% of the costs were focused on gross margin
improvements, 40% on SAG and 10% on the optimization of RD&E
investments, and impacted the following functional areas:
– Services
– Supply chain and manufacturing
– Back-office administration
– Development and engineering costs.
•$28 for lease termination costs, primarily reflecting the continued
rationalization and optimization of our worldwide operating locations,
particularly as a result of our acquisition of ACS.
•$19 loss associated with the sale of our Venezuelan subsidiary. The
loss primarily reflects the write-off of our Venezuelan net assets
including working capital and long-lived assets. We continue to sell
equipment, parts and supplies to the acquiring company through
a distribution arrangement but no longer have any direct or local
operations in Venezuela.
The above charges were partially offset by $41 of net reversals for
changes in estimated reserves from prior-period initiatives.
2009Activity
Restructuring activity was minimal in 2009 and the related charges
primarily reflected changes in estimates in severance costs from previously
recorded actions.
Note 10 – Supplementary Financial Information
The components of other current and long-term assets and liabilities were
as follows:
December 31,
2011 2010
Other Current Assets
Deferred taxes and income taxes receivable $ 261 $ 345
Royalties, license fees and software maintenance 143 155
Restricted cash 97 91
Prepaid expenses 147 133
Derivative instruments 58 45
Deferred purchase price from sale of receivables 97 90
Advances and deposits 28 23
Other 227 244
Total Other Current Assets $ 1,058 $ 1,126
Notes to the Consolidated
Financial Statements
(in millions, except per-share data and where otherwise noted)