2. RESTRUCTURING PLAN

In July 2014, we announced a restructuring plan to strategically reallocate resources so that we can focus on our higher-growth, higher-margin opportunities in the software-driven consumer transaction technologies industry. The program is centered on ensuring that our people and processes are aligned with our continued transformation and includes: rationalizing our product portfolio to eliminate overlap and redundancy; taking steps to end-of-life older commodity product lines that are costly to maintain and provide low margins; moving lower productivity services positions to our new centers of excellence due to the positive impact of services innovation; and reducing layers of management and organizing around divisions to improve decision-making, accountability and strategic execution.

As a result of the restructuring plan, the Company recorded a total charge of $12 million and $36 million in the three and nine months ended September 30, 2015, respectively, and a total charge of $130 million in the three and nine months ended September 30, 2014. The Company expects to achieve annualized run-rate savings of approximately $105 million beginning in 2016. The Company expects that it may identify additional restructuring-related opportunities in connection with this restructuring plan, and may incur additional charges through 2015 related to such additional opportunities. Such additional charges are not reasonably estimable at this time as the Company is in the process of defining the nature and scope of these additional opportunities and quantifying the impact thereof.

Charges related to the restructuring plan for the the three and nine months ended September 30 were:



	Three months ended September 30				Nine months ended September 30
In millions	2015		2014		2015			2014
Severance and other employee-related costs
ASC 712 charges included in restructuring-related charges	$	—	$	61	$	(5	)	$	61
ASC 420 charges included in restructuring-related charges	7		4		12			4
Inventory-related charges
Charges included in cost of products	—		9		3			9
Charges included in cost of services	—		46		—			46
Asset-related charges
External and internal use software impairment charges included in restructuring-related charges	—		5		2			5
Impairment of long-lived assets included in restructuring- related charges	—		—		14			—
Other than temporary impairment of an investment included in other (expense), net	—		3		—			3
Other exit costs
Other exit costs included in restructuring-related charges	5		2		10			2
Total restructuring-related charges	$	12	$	130	$	36		$	130

In the nine months ended September 30, 2015, asset related charges include the write-off of certain external use capitalized software for projects that have been abandoned as well as an impairment of long-lived assets that are no longer considered strategic and were held for sale. As of September 30, 2015, the carrying amount of the long-lived assets classified as held for sale was $17 million. The Company utilized Level 3 inputs, as defined in the fair value hierarchy, to measure the fair value of such assets. In the nine months ended September 30, 2014, asset related charges include the write-off of certain internal and external use capitalized software for projects where the Company has redirected resources to higher growth opportunities and abandoned certain projects. Additionally, the charges include an other than temporary impairment for an investment that is no longer considered strategic. See Note 12, “Fair Value of Assets and Liabilities,” for additional information.

The results by segment, as disclosed in Note 13, "Segment Information and Concentrations," exclude the impact of these costs, which is consistent with the manner by which management assesses the performance and evaluates the results of each segment. The following table summarizes the total liabilities relating to the restructuring plan, which are included on the Condensed Consolidated Balance Sheet in other current liabilities.



In millions	2015	2014
Employee Severance and Other Exit Costs
Beginning balance as of January 1	$60	$—
Cost recognized during the period	22	67
Change in estimated payments under ASC 712	(5)	—
Utilization	(51)	(9)
Foreign currency translation adjustments	(2)	—
Ending balance as of September 30	$24	$58