OTHER OPERATING CREDITS AND CHARGES, NET

The major components of “Other operating credits and charges, net” in the Consolidated Statements of Income for the years ended December 31 are reflected in the table below and described in the paragraphs following the table:



Dollar amounts in millions	Year ended December 31,
Dollar amounts in millions	2014			2013			2012
Adjustment related to a change in inventory convention for spare parts	$	—		$	(4.8	)	$	—
Adjustment related to prior year inventory	—			(1.6		)	(1.5		)
Adjustment related to prior year depreciation	—			(1.6		)	—
Refundable value added tax receivable	—			1.4			—
Insurance recovery	0.5			1.9			—
Contingent consideration fair value adjustment	3.2			20.5			—
Addition to workers compensation reserves	(0.4		)	(1.0		)	—
Adjustments to retirement accounts	—			—			(3.8		)
Gain due to forfeiture of deposit	1.0			—			—
Reductions, net of additions, to product related contingency reserves	—			—			5.0
Adjustment to product related warranty reserves	(11.3		)	(17.7		)	1.8
Additions to environmental related contingency reserves	(0.5		)	(1.0		)	—
Timber related reserves	—			—			0.8
Other	—			0.1			0.6
	$	(7.5	)	$	(3.8	)	$	2.9
Other operating charges and credits associated with unconsolidated affiliates:
Valuation allowance associated with deferred taxes	$	1.0		$	(1.8	)	$	—
Addition to contingency reserves	$	—		$	(0.9	)	$	—
	$	1.0		$	(2.7	)	$	—

2014

During 2014, LP recorded a $7.5 million loss in "Other operating credits and charges, net". The components of the net charges include:


•	a gain of $0.5 million related to proceeds received from an insurance claim;


•	a gain of $3.2 million related to fair market value adjustment to the contingent consideration payable in connection with a business combination (see Note 3 and Note 23 for additional discussions on fair value measurements and the acquisition of Peace Valley OSB);


•	a loss of $0.4 million associated with a workers compensation reserve adjustment at an siding mill;


•	a gain of $1.0 million due to the forfeiture of a deposit posted with LP in relation to assets held for sale;


•	a loss of $11.3 million related to an increase in product related warranty reserves associated with CanExel products sold in specific geographic locations and for a specific time period;


•	a loss of $0.5 million related to an increase in environmental reserves associated with a previously owned plywood mill.

Additionally, other operating charges and credits reflected in Equity in (income) loss from unconsolidated affiliates includes a gain of $1.0 million associated with the reduction of a valuation allowance on the joint venture's books associated with deferred tax assets

2013

During 2013, LP recorded a $3.8 million loss in "Other operating credits and charges, net". The components of the net charges include:


•	a loss of $4.8 million related to a change in inventory convention for spare parts;


•	a loss of $1.6 million related to a prior year inventory adjustment;


•	a loss of $1.6 million related to a correction of prior years depreciation amounts associated with LP's South American operations;


•	a loss of $17.7 million related to an increase in product related warranty reserves associated with CanExel products sold in specific geographic locations and for a specific time period;


•	a gain of $1.4 million related to value added taxes;


•	a gain of $1.9 million related to proceeds received from insurance claims associated with an OSB mill in Canada and and earthquake in Chile;


•	a gain of $20.5 million in relation to the fair market value adjustment of the contingent consideration payable in connection with a business combination. See Note 3 and Note 24 for additional discussions on fair value measurements and the acquisition of Peace Valley OSB;


•	a loss of $1.0 million associated with a workers compensation reserve adjustment at an OSB mill; and


•	a loss of $1.0 million related to an increase in environmental reserves associated with a previously owned plywood mill.

Additionally, other operating charges and credits reflected in Equity in (income) loss from unconsolidated affiliates includes a charge of $1.8 million associated with a valuation allowance on the joint venture's books associated with deferred tax assets as well as a loss of $0.9 million associated with the recording of a contingent liability from past years.

2012

During 2012, LP recorded a $2.9 million gain in “Other operating credits and charges, net”. The components of the net credits include:


•	a loss of $1.5 million related to a prior year inventory adjustment;


•	a loss of $3.8 million consisting of $2.2 million related to SERP settlement associated with the retirement of LP's previous CEO and $1.6 million related to termination indemnities in South America;


•	a gain of $5.0 million related to a reduction in product related contingency reserves associated with the national hardboard class action settlement (see Note 18 for further discussion);


•	a gain of $1.8 million consisting of a loss of $1.0 million for additions to warranty reserves associated with Canexel products sold in Europe in prior years, a loss of $0.8 million for additions to warranty reserves associated with a discontinued line of OSB siding and a gain of $3.6 million related to a reduction in hardboard siding trim warranty reserve; and


•	a gain of $0.8 million related to reductions in reforestation liabilities associated with LP's Canadian timber obligations.

Severance

Over the course of the last three years, LP has entered into several restructuring plans in an effort to sell selected businesses and reduce overall expenses. The detail of the severance accrual and related expense and payments for the last three years is as follows:



Dollar amounts in millions	Year ended December 31,
Dollar amounts in millions	2014			2013			2012
Beginning balance	$	0.7		$	0.7		$	1.5
Charged to expense, continuing operations	0.8			0.8			1.0
Payments	(1.1		)	(0.8		)	(1.8		)
Ending balance	$	0.4		$	0.7		$	0.7

The balance of the accrued severance is included in “Accounts payable and accrued liabilities” on the Consolidated Balance Sheets. The balance as of December 31, 2014 is payable under contract through 2014. For the year ended December 31, 2014, severance expense is primarily related to general and corporate expenses.