Note 6. 2012-2014 Restructuring Program

In 2012, our Board of Directors approved $1.5 billion of restructuring and related implementation costs (“2012-2014 Restructuring Program”) reflecting primarily severance, asset disposals and other manufacturing-related one-time costs. The primary objective of the restructuring and implementation activities was to ensure that Mondelēz International and Kraft Foods Group were each set up to operate efficiently and execute on our respective business strategies upon separation and in the future.

Of the $1.5 billion of 2012-2014 Restructuring Program costs, we retained approximately $925 million and Kraft Foods Group retained the balance of the program. Since inception, we have incurred $506 million of our estimated $925 million total 2012-2014 Restructuring Program charges.

Restructuring Costs:

We recorded restructuring charges of $42 million in the three months ended March 31, 2014 and $40 million in the three months ended March 31, 2013 within asset impairment and exit costs.

The activity in the 2012-2014 Restructuring Program liability for the three months ended March 31, 2014 was:


	Severance and related costs			Asset Write-downs			Total
	(in millions)

Liability balance, January 1, 2014	$	68		$	–		$	68
Charges		30			12			42
Cash spent		(28	)		–			(28	)
Non-cash settlements		(1	)		(12	)		(13	)

Liability balance, March 31, 2014	$	69		$	–		$	69

We spent $28 million in the three months ended March 31, 2014 and $4 million in the three months ended March 31, 2013 in cash severance and related costs. We also recognized non-cash asset write-downs (including accelerated depreciation and asset impairments) and other non-cash settlements totaling $13 million in the three months ended March 31, 2014 and $9 million in the three months ended March 31, 2013. At March 31, 2014, our net restructuring liability was $69 million recorded within other current liabilities.

Implementation Costs:

Implementation costs are directly attributable to restructuring activities; however, they do not qualify for special accounting treatment as exit or disposal activities. These costs primarily include costs to reorganize our operations and facilities, the discontinuance of certain product lines and the incremental expenses related to the closure of facilities, replicating our information systems infrastructure and reorganizing costs related to our sales function. We believe the disclosure of implementation costs provides readers of our financial statements greater transparency to the total costs of our 2012-2014 Restructuring Program. Within our continuing results of operations, we recorded implementation costs of $24 million in the three months ended March 31, 2014 and $4 million in the three months ended March 31, 2013. We recorded these costs within cost of sales and selling, general and administrative expense primarily within our Europe, North America and EEMEA segments.

Restructuring and Implementation Costs by Segment:

During the three months ended March 31, 2014 and 2013, we recorded restructuring and implementation costs within operating income as follows:


	For the Three Months Ended March 31, 2014						For the Three Months Ended March 31, 2013
	Restructuring		Implementation				Restructuring		Implementation
	Costs		Costs		Total		Costs		Costs		Total
	(in millions)

Latin America	$	1	$	–	$	1	$	–	$	–	$	–
Asia Pacific		–		–		–		–		–		–
EEMEA		4		1		5		1		–		1
Europe		17		15		32		19		2		21
North America		20		7		27		20		2		22
Corporate		–		1		1		–		–		–

Total	$	42	$	24	$	66	$	40	$	4	$	44