Severance and Exit Costs

9 Months Ended

Dec. 31, 2016

Restructuring and Related Activities [Abstract]

Severance and exit costs consist of lease exit costs primarily associated with tower and cell sites, access exit costs related to payments that will continue to be made under our backhaul access contracts for which we will no longer be receiving any economic benefit, and severance costs associated with reductions in our work force.

The following provides the activity in the severance and exit costs liability included in "Accounts payable," "Accrued expenses and other current liabilities" and "Other liabilities" within the consolidated balance sheets:



	March 31, 2016		Net (Benefit) Expense				Cash Payments and Other			December 31, 2016
	(in millions)
Lease exit costs	$	338	$	(3	)	⁽¹⁾	$	(100	)	$	235
Severance costs	150		15			⁽²⁾	(145		)	20
Access exit costs	37		20			⁽³⁾	(24		)	33
	$	525	$	32			$	(269	)	$	288

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(1)

For the three and nine-month periods ended December 31, 2016, we recognized costs of $2 million (Wireless only) and a benefit of $3 million ($5 million benefit Wireless, $2 million costs Wireline), respectively. The Wireless benefit for the nine-month period resulted from the reversal of certain lease exit cost reserves associated with the shutdown of the Clearwire WiMAX network on March 31, 2016.


(2)	For the three and nine-month periods ended December 31, 2016, we recognized costs of $6 million (Wireless only) and $15 million (Wireless only), respectively.


(3)	For the three and nine-month periods ended December 31, 2016, $11 million ($6 million Wireless, $5 million Wireline) and $18 million ($8 million Wireless, $10 million Wireline), respectively, were recognized as "Severance and exit costs." For the nine-month period ended December 31, 2016, $2 million (Wireline only) was recognized as "Cost of services."

We continually refine our network strategy and evaluate other potential network initiatives to improve the overall performance of our network. Additionally, a major cost reduction initiative is underway, which may include headcount reductions, among other actions, to reduce operating expenses and improve our operating cash flows. As a result of these ongoing activities, we may incur future material charges associated with lease and access exit costs, severance, asset impairments, and accelerated depreciation, among others.