Motorola 2012 Annual Report Download - page 97

89
Geographic area information
Net Sales Assets Property, Plant, and
Equipment, net
Years ended December 31 2012 2011 2010 2012 2011 2010 2012 2011 2010
United States $ 4,807 $ 4,417 $ 4,161 $ 8,743 $ 8,888 $ 10,501 $ 505 $ 504 $ 484
China 344 322 307 570 860 1,823 13 14 9
United Kingdom 263 270 257 1,393 584 850 19 21 23
Israel 119 127 112 823 1,128 1,366 22 26 40
Malaysia 92 91 50 448 331 369 54 44 42
Japan 88 97 99 127 553 724 560 61
Denmark 44 46 46 90 93 101 52 62 72
Other, net of eliminations 2,941 2,966 2,734 485 1,492 2,063 169 165 191
$ 8,698 $ 8,203 $ 7,617 $ 12,679 $ 13,929 $ 17,797 $ 839 $ 896 $ 922
Net sales are attributed to countries based on the shipping location of the ultimate destination with the exception of sales to the U.S. federal government. Sales
to the U.S. federal government are included within the United States regardless of shipping location. For 2010 and 2011 certain sales have been reclassified
between countries to conform to the current year's presentation, which primarily includes; (i) sales from the United Kingdom to "Other, net of eliminations"
and (ii) sales from Israel to "Other, net of eliminations."
13. Reorganization of Businesses
The Company maintains a formal Involuntary Severance Plan (the “Severance Plan”), which permits the Company to
offer eligible employees severance benefits based on years of service and employment grade level in the event that employment
is involuntarily terminated as a result of a reduction-in-force or restructuring. The Company recognizes termination benefits
based on formulas per the Severance Plan at the point in time that future settlement is probable and can be reasonably estimated
based on estimates prepared at the time a restructuring plan is approved by management. Exit costs consist of future minimum
lease payments on vacated facilities and other contractual terminations. At each reporting date, the Company evaluates its
accruals for employee separation and exit costs to ensure the accruals are still appropriate. In certain circumstances, accruals
are no longer needed because of efficiencies in carrying out the plans or because employees previously identified for separation
resigned from the Company and did not receive severance, or were redeployed due to circumstances not foreseen when the
original plans were approved. In these cases, the Company reverses accruals through the consolidated statements of operations
where the original charges were recorded when it is determined they are no longer needed.
2012 Charges
During 2012, the Company continued to implement various productivity improvement plans aimed at achieving long-
term, sustainable profitability by driving efficiencies and reducing operating costs. Both of the Company’s segments were
impacted by these plans. The employees affected were located in all geographic regions.
During 2012, the Company recorded net reorganization of business charges of $50 million, including $9 million of
charges in Costs of sales and $41 million of charges under Other charges in the Company’s consolidated statements of
operations. Included in the aggregate $50 million are charges of $54 million for employee separation costs, and $7 million for
building impairment, partially offset by $11 million of reversals for accruals no longer needed.
The following table displays the net charges incurred by segment:
Year ended December 31, 2012
Government $33
Enterprise 17
$50
The following table displays a rollforward of the reorganization of businesses accruals established for exit costs and
employee separation costs from January 1, 2012 to December 31, 2012:
Accruals at
January 1, 2012
Additional
Charges Adjustments
Amount
Used
Accruals at
December 31, 2012
Exit costs $ 14 $ — $ 1 $ (11)$ 4
Employee separation costs 30 54 (9)(44)31
$ 44 $ 54 $ (8)$ (55)$ 35