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AVNET, INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Ì (Continued)
Fiscal 2005 and 2004
The following table summarizes the activity associated with the fiscal 2004 restructuring changes taken in
response to business conditions with the time of the change. These charges for the past three years, including
activity in the related accrued liability and reserve accounts subsequent to initially recording the charge:
Severance Facility IT-Related
Costs Exit Costs Costs Other Total
Balance at June 27, 2003ÏÏÏÏÏÏÏÏÏÏÏ $ 7,234 $ 36,908 $ 742 $ 647 $ 45,531
2004 activity ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 14,691 15,643 19,759 5,525 55,618
Amounts utilizedÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (18,235) (32,411) (19,351) (5,624) (75,621)
AdjustmentsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (1,043) 1,164 (210) Ì (89)
Other, principally foreign currency
translation ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 381 1,041 (68) Ì 1,354
Balance at July 3, 2004 ÏÏÏÏÏÏÏÏÏÏÏÏ 3,028 22,345 872 548 26,793
Amounts utilizedÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (1,285) (11,161) (722) (207) (13,375)
AdjustmentsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (350) (952) (18) Ì (1,320)
Other, principally foreign currency
translation ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 26 245 (21) 10 260
Balance at July 2, 2005 ÏÏÏÏÏÏÏÏÏÏÏÏ 1,419 10,477 111 351 12,358
Amounts utilizedÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (1,135) (4,122) Ì (63) (5,320)
AdjustmentsÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ 279 (663) (108) Ì (492)
Other, including foreign currency
translation ÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏÏ (95) 250 (3) Ì 152
Balance at July 1, 2006 ÏÏÏÏÏÏÏÏÏÏÏÏ $ 468 $ 5,942 $ Ì $ 288 $ 6,698
Total amounts utilized in fiscal 2006, 2005 and 2004 consist of cash payments of $5,320,000, $13,375,000,
and $44,212,000, respectively, and non-cash asset write-downs of $31,409,000, in fiscal 2004.
During fiscal 2006, the Company recorded certain adjustments to these reserves totaling $492,000, which
were recorded in restructuring, integration and other charges in the consolidated statement of operations.
These adjustments were a result of management's ongoing analysis of its restructuring reserves related
primarily to the release of excess lease liabilities and additional severance reserve based on revised estimates of
the Company's obligation.
During fiscal 2005, the Company recorded certain adjustments to reserves totaling $1,320,000 during
fiscal 2005, which were recorded through selling, general and administrative expenses. The adjustments
related primarily to the reversal of certain excess legal expense reserves associated with finalization of
termination payments and reversal of excess severance reserves offset in part by additional severance costs
recorded based upon revised estimates of required payouts. The Company also reduced certain lease reserves
due to modification to sublease and termination assumptions based upon ongoing market conditions.
During the first and second quarters of fiscal 2004, the Company executed certain restructuring and cost
cutting initiatives in order to improve profitability. These actions can generally be broken into three categories:
(1) the combination of the CM and AC operating groups into one computer products and services business
(see Note 16); (2) the reorganization of the Company's global IT resources, which had previously been
administered generally on a separate basis within each of the Company's operating groups; and (3) various
other reductions within EM and certain centralized support functions.
83