Quarterly report pursuant to Section 13 or 15(d)

Restructuring and Asset Impairment Charges

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Restructuring and Asset Impairment Charges
 9 Months Ended
Sep. 27, 2014
Restructuring Costs and Asset Impairment Charges [Abstract]  
Restructuring and Asset Impairment Charges [Text Block]
Note 13: Restructuring and Asset Impairment Charges
Beginning in the third quarter of 2013, management has approved several restructuring actions including targeted workforce reductions and the exit of certain businesses and facilities. These actions include the wind down of our 200 millimeter wafer fabrication facility in Massachusetts and the closure of our assembly and test facility in Costa Rica, which we expect to cease production in the first quarter of 2015 and the end of 2014, respectively. These targeted reductions will enable the company to better align our resources in areas providing the greatest benefit in the current business environment.
Restructuring and asset impairment charges for each period were as follows:
 
 
Three Months Ended
 
Nine Months Ended
(In Millions)
 
Sep 27,
2014
 
Sep 28,
2013
 
Sep 27,
2014
 
Sep 28,
2013
Employee severance and benefit arrangements
 
$
9

 
$
85

 
$
218

 
$
85

Asset impairments and other restructuring charges
 
11

 
39

 
20

 
39

Total restructuring and asset impairment charges
 
$
20

 
$
124

 
$
238

 
$
124


The restructuring and asset impairment activity for first nine months of 2014 was as follows:
(In Millions)
 
Employee Severance and Benefits
 
Asset Impairments and Other
 
Total
Accrued restructuring balance as of December 28, 2013
 
$
183

 
$
—

 
$
183

Additional accruals
 
203

 
19

 
222

Adjustments
 
15

 
1

 
16

Cash payments
 
(283
)
 
(3
)
 
(286
)
Non-cash settlements
 
—

 
(9
)
 
(9
)
Accrued restructuring balance as of September 27, 2014
 
$
118

 
$
8

 
$
126


We recorded the additional accruals and adjustments as restructuring and asset impairment charges in the consolidated condensed statements of income and within the “all other” operating segments category. The charges incurred during the first nine months of 2014 included $218 million related to employee severance and benefit arrangements, which impacted approximately 2,800 employees. In the second quarter of 2014, we had estimated that 3,500 employees would be impacted by restructuring actions, but such number has decreased to 2,800 employees, mainly driven by the internal placement of previously impacted employees and the cancellation of prior quarter actions. Most of the accrued restructuring balance as of September 27, 2014 relates to employee severance and benefits, which are expected to be paid within the next 12 months, and was recorded as a current liability within accrued compensation and benefits in the consolidated condensed balance sheets.
Since the third quarter of 2013, we have incurred a total of $478 million in restructuring and asset impairment charges. These charges included a total of $419 million related to employee severance and benefit arrangements for approximately 6,700 employees, and $59 million in asset impairment and other restructuring charges.