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Restructuring
6 Months Ended
Jun. 30, 2012
Restructuring and Related Activities [Abstract]  
Restructuring
Restructuring

In order to contain costs and mitigate the impact of current and expected future economic conditions, as well as a continued focus on process improvements, we have initiated various restructuring plans over the last several years. The plans that are currently active with a remaining liability are further described below. The charges for each restructuring plan are classified as selling and general expenses within the consolidated statements of income.

During the fourth quarter of 2011, we initiated a restructuring plan to create a flatter and more agile organization as part of our Growth and Value Plan, which includes creating two independent public companies with focused cost structures. While initially focused on our MHE segment, these actions also included other parts of the Company. We recorded a pre-tax restructuring charge of $66 million, consisting primarily of facility exit costs and employee severance costs related to a company-wide workforce reduction of approximately 800 positions. In the second quarter of 2012 we recorded an additional pre-tax restructuring charge of $5 million primarily for employee severance costs as part of the Growth and Value Plan. For the three months ended June 30, 2012, we have reduced the reserve by $12 million, primarily relating to cash payments for employee severance costs, mainly at MHE. The remaining reserve as of June 30, 2012 is $37 million and is included in other current liabilities in the unaudited consolidated balance sheet.

As of June 30, 2012, our 2006 restructuring initiative still has a remaining reserve relating to facilities costs of $3 million.