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Restructuring Plan
 6 Months Ended
Jun. 30, 2016
Restructuring and Related Activities [Abstract]  
Restructuring Plan
4. 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 $8 million and $10 million in the three and six months ended June 30, 2016, respectively, and $8 million and $24 million in the three and six months ended June 30, 2015, respectively. The Company expects to achieve annualized run-rate savings of approximately $105 million in 2016. Our estimate of restructuring-related opportunities in connection with this restructuring plan for 2016 is approximately $20 million to $25 million.


Charges related to the restructuring plan for the the three and six months ended June 30 were:
 
Three months ended June 30
 
Six months ended June 30
In millions
2016
 
2015
 
2016
 
2015
Severance and other employee-related costs
 
 
 
 
 
 
 
     ASC 712 charges included in restructuring-related charges
$
2

 
$
(4
)
 
$
2

 
$
(6
)
     ASC 420 charges included in restructuring-related charges
(2
)
 
4

 
(2
)
 
6

Inventory-related charges
 
 
 
 
 
 
 
     Charges included in cost of products
—

 
2

 
—

 
3

     Charges included in cost of services
4

 
—

 
4

 
—

Asset-related charges
 
 
 
 
 
 
 
     External and internal use software impairment charges
     included in restructuring-related charges
1

 
2

 
2

 
2

     Impairment of long-lived assets included in restructuring-
     related charges
—

 
—

 
—

 
14

Other exit costs
 
 
 
 
 
 
 
     Other exit costs included in restructuring-related charges
3

 
4

 
4

 
5

Total restructuring charges
$
8

 
$
8

 
$
10

 
$
24



In the three and six months ended June 30, 2016 and 2015, asset related charges included the write-off of internal and external use capitalized software for projects that have been abandoned. In the six months ended June 30, 2015, asset related charges included the impairment of long-lived assets that were no longer considered strategic and were held for sale. The Company utilized Level 3 inputs, as defined in the fair value hierarchy, to measure the fair value.

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 Sheets in other current liabilities.
In millions
2016
 
2015
Employee Severance and Other Exit Costs
 
 
 
Beginning balance as of January 1
$
20

 
$
60

Cost recognized during the period
6

 
5

Change in estimated payments
(2
)
 
—

Utilization
(16
)
 
(30
)
Foreign currency translation adjustments
—

 
(2
)
Ending balance as of June 30
$
8

 
$
33