American Express 2015 Annual Report Download - page 157

The following is a detail of Other expenses for the years ended December 31:
(Millions) 2015 2014 2013
Professional services ........................................................... $2,750 $3,008 $3,102
Occupancy and equipment ...................................................... 1,854 1,807 1,904
Goodwill and long-lived asset impairment (a) ........................................ 384 ——
Card and merchant-related fraud losses (b) ......................................... 308 369 278
Communications ............................................................... 345 383 379
Gain on business travel joint venture transaction .................................... —(630) —
Other (c) ....................................................................... 1,152 1,152 1,133
Total Other expenses ......................................................... $6,793 $6,089 $6,796
(a) Refer to Note 2 for additional information.
(b) Beginning January 1, 2015, merchant-related fraud losses are reported within Other expenses.
(c) Other expense includes general operating expenses, gains (losses) on sale of assets or businesses not classified as discontinued operations,
litigation, certain internal and regulatory review-related reimbursements and insurance costs or settlements, certain loyalty coalition-related
expenses and foreign currency-related gains and losses (including the favorable impact from the reassessment of the functional currency of
certain UK legal entities in the year ended December 31, 2015). Effective December 1, 2015, Other expenses includes the valuation allowance
adjustment associated with the HFS portfolios.
NOTE 20
RESTRUCTURING
From time to time, the Company initiates restructuring programs to become more efficient and effective, and to
support new business strategies. In connection with these programs, the Company typically will incur severance and
other exit costs.
During 2015, the Company recorded a net reduction of $26 million in restructuring charges, consisting of a
reduction of $61 million in revisions to prior estimates, partially offset by $35 million in net restructuring charges for
EG recorded in the fourth quarter.
During 2014, the Company recorded $411 million of restructuring charges, net of revisions to prior estimates. The
2014 activity primarily relates to $313 million and $133 million of restructuring charges recorded in the fourth quarter
and second quarter, respectively.
Restructuring charges related to severance obligations are included in salaries and employee benefits in the
Company’s Consolidated Statements of Income, while charges pertaining to other exit costs are included in
occupancy and equipment and other expenses.
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