Reorganization Of Businesses

9 Months Ended

Sep. 29, 2012

Reorganization Of Businesses [Abstract]

Reorganization of Businesses

2012 Charges

During the three months ended September 29, 2012, the Company recorded net reorganization of business charges of $13 million including $10 million of charges in Other charges, and $3 million of charges in Costs of sales in our condensed consolidated statements of operations. The $13 million of charges all relate to employee separation costs.

During the nine months ended September 29, 2012, the Company recorded net reorganization of business charges of $36 million, including $30 million of charges in Other charges and $6 million of charges in Costs of sales in the Company's condensed consolidated statements of operations. Included in the aggregate of $36 million are charges of $43 million for employee separation costs, and $1 million for building impairment charges, partially offset by $8 million of reversals for accruals no longer needed.

The following table displays the net charges incurred by segment:



September 29, 2012	Three Months Ended		Nine Months Ended
Government	$	8	$	24
Enterprise	5		12
	$	13	$	36

The following table displays a rollforward of the reorganization of businesses accruals established for lease exit costs and employee separation costs from January 1, 2012 to September 29, 2012:



	Accruals at January 1, 2012		Additional Charges		Adjustments			Amount Used			Accruals at September 29, 2012
Exit costs	$	14	$	—	$	2		$	(8	)	$	8
Employee separation costs	30		43		(7		)	(33		)	33
	$	44	$	43	$	(5	)	$	(41	)	$	41

Exit Costs

At January 1, 2012, the Company had an accrual of $14 million for exit costs attributable to lease terminations. During the nine months ended September 29, 2012, there were no additional charges related to the exit of leased facilities. The $8 million used reflects cash payments. The remaining accrual of $8 million, which is included in Accrued liabilities in the Company’s condensed consolidated balance sheets at September 29, 2012, primarily represents future cash payments for lease termination obligations that are expected to be paid over a number of years.

Employee Separation Costs

At January 1, 2012, the Company had an accrual of $30 million for employee separation costs, representing the severance costs for: (i) severed employees who began receiving payments in 2011, and (ii) approximately 500 employees who began receiving payments in 2012. The 2012 additional charges of $43 million represent severance costs for approximately 700 employees, of which 500 were indirect employees and 200 were direct employees. The adjustment of $7 million reflects reversals of accruals no longer needed. The $33 million used reflects cash payments. The remaining accrual of $33 million, which is included in Accrued liabilities in the Company’s condensed consolidated balance sheets at September 29, 2012, is expected to be paid, generally, within one year to approximately 700 employees, who have either been severed or have been notified of their severance and have begun or will begin receiving payments.

2011 Charges

During the three months ended October 1, 2011, the Company recorded net reorganization of business charges of $10 million, primarily under Other charges in the Company’s condensed consolidated statements of operations. Included in the $10 million are charges of $8 million for employee separation costs and $2 million for exit costs.

During the nine months ended October 1, 2011, the Company recorded net reorganization of business charges of $35 million, including $3 million of charges in Costs of sales and $32 million of charges under Other charges in the Company’s condensed consolidated statements of operations. Included in the $35 million are charges of $22 million related to the separation of approximately 400 indirect employees, and $15 million related to the exit of leased facilities, partially offset by $2 million of reversals for accruals no longer needed.

The following table displays the net charges incurred by segment:



October 1, 2011	Three Months Ended		Nine Months Ended
Government	$	7	$	25
Enterprise	3		10
	$	10	$	35

- Definition

The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled.

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