Pepsi 2013 Annual Report Download - page 98

Download and view the complete annual report

Please find page 98 of the 2013 Pepsi annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 164

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164

80
In July 2012, the FASB issued new accounting guidance that permits an entity to first assess qualitative
factors to determine whether it is more likely than not that an indefinite-lived intangible asset is impaired as
a basis for determining whether it is necessary to perform a quantitative impairment test. An entity would
continue to calculate the fair value of an indefinite-lived intangible asset if the asset fails the qualitative
assessment, while no further analysis would be required if it passes. The provisions of the new guidance
were effective for, and had no impact on, our 2013 annual indefinite-lived intangible asset impairment test
results.
In December 2011, the FASB issued new disclosure requirements that are intended to enhance current
disclosures on offsetting financial assets and liabilities. The new disclosures require an entity to disclose
both gross and net information about derivative instruments accounted for in accordance with the guidance
on derivatives and hedging that are eligible for offset on the balance sheet and instruments and transactions
subject to an agreement similar to a master netting arrangement. The provisions of the new disclosure
requirements are effective as of the beginning of our 2014 fiscal year. We do not expect the adoption of this
new guidance to have a material impact on our financial statements.
Note 3 — Restructuring, Impairment and Integration Charges
2014 Productivity Plan
The 2014 Productivity Plan includes the next generation of productivity initiatives that we believe will
strengthen our food, snack and beverage businesses by accelerating our investment in manufacturing
automation; further optimizing our global manufacturing footprint, including closing certain manufacturing
facilities; re-engineering our go-to-market systems in developed markets; expanding shared services; and
implementing simplified organization structures to drive efficiency. The 2014 Productivity Plan is in addition
to the productivity plan we began implementing in 2012 and is expected to continue the benefits of that plan.
In 2013, we incurred restructuring charges of $53 million ($39 million after-tax or $0.02 per share) in
conjunction with our 2014 Productivity Plan. All of these charges were recorded in selling, general and
administrative expenses and primarily relate to severance and other employee related costs. Substantially all
of the restructuring accrual at December 28, 2013 is expected to be paid by the end of 2014.
A summary of our 2014 Productivity Plan charges in 2013 is as follows:
Severance and Other
Employee Costs Other Costs Total
FLNA $ 11 $ — $11
QFNA 3 — 3
LAF 5 — 5
PAB 10 — 10
Europe 10 — 10
AMEA 1 — 1
Corporate 12 1 13
$ 52$ 1$ 53