Restructuring Charges and Other Costs Associated with Acquisitions and Cost-Reduction/Productivity Initiatives (Tables)

3 Months Ended

Apr. 03, 2022

Restructuring and Related Activities [Abstract]

Schedule of Acquisitions and Cost-Reduction/Productivity Initiatives

The following summarizes acquisitions and cost-reduction/productivity initiatives costs and credits:
	Three Months Ended
(MILLIONS)	April 3, 2022		April 4, 2021
Restructuring charges/(credits):
Employee terminations	$	25	$	22
Asset impairments	8		(5)
Exit costs/(credits)	11		—
Restructuring charges/(credits)(a)	43		17
Transaction costs(b)	6		—
Integration costs and other(c)	142		5
Restructuring charges and certain acquisition-related costs	192		22
Net periodic benefit costs/(credits) recorded in Other (income)/deductions––net	(6)		8
Additional depreciation––asset restructuring recorded in our condensed consolidated statements of income, mainly in Cost of sales(d)	9		6
Implementation costs recorded in our condensed consolidated statements of income as follows(e):
Cost of sales	12		11
Selling, informational and administrative expenses	74		64
Total implementation costs	85		75
Total costs associated with acquisitions and cost-reduction/productivity initiatives	$	280	$	111

(a)Primarily represents cost reduction initiatives.

(b)Represents external costs for banking, legal, accounting and other similar services.

(c)Represents external, incremental costs directly related to integrating acquired businesses, such as expenditures for consulting and the integration of systems and processes, and certain other qualifying costs. In the first quarter of 2022, integration costs and other were mostly related to our acquisition of Arena, including $138 million in payments to Arena employees for the fair value of previously unvested long-term incentive awards. See Note 2A.

(d)Represents the impact of changes in the estimated useful lives of assets involved in restructuring actions.

(e)Represents external, incremental costs directly related to implementing our non-acquisition-related cost-reduction/productivity initiatives.

Schedule of Components and Changes in Restructuring Accruals

The following summarizes the components and changes in restructuring accruals:
(MILLIONS)	Employee Termination Costs		Asset Impairment Charges		Exit Costs		Accrual
Balance, December 31, 2021(a)	$	1,014	$	—	$	57	$	1,071
Provision	25		8		11		43
Utilization and other(b)	(95)		(8)		(59)		(163)
Balance, April 3, 2022(c)	$	943	$	—	$	9	$	952

(a)Included in Other current liabilities ($816 million) and Other noncurrent liabilities ($255 million).

(b)Includes adjustments for foreign currency translation.

(c)Included in Other current liabilities ($812 million) and Other noncurrent liabilities ($140 million).