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Restructuring and Impairment Charges | 12 Months Ended
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Dec. 31, 2020
Restructuring and Impairment Charges |
Restructuring and Impairment Charges | NOTE 5 – Restructuring and Impairment Charges ​ For the year ended December 31, 2020, the Company recorded a total of $93 million of pre-tax restructuring and impairment charges, including $48 million of pre-tax restructuring costs and $45 million of pre-tax impairment charges. The Company recorded pre-tax restructuring charges of $25 million for its Cost Smart selling, general and administrative expense (“SG&A”) program. These costs include $18 million of other costs, including professional services, and $7 million of employee-related severance for the year ended December 31, 2020. The professional services costs were recorded primarily in the Company’s North America operations, while the employee-related severance were primarily recorded in the Company’s North America and EMEA operations. ​ The Company also recorded $23 million of pre-tax restructuring charges for its Cost Smart Cost of sales program. These costs included $10 million of restructuring charges in relation to the closure of the Lane Cove, Australia production facility, including $5 million of inventory and mechanical store write-offs, $4 million of other costs, and $1 million of accelerated depreciation. Additionally, the Company recorded $13 million of restructuring charges related to facility and product line closures in North America during the year, including the closure of the Berwick, Pennsylvania manufacturing facility and the cessation of ethanol production at the Cedar Rapids, Iowa facility. These restructuring charges included $7 million of accelerated depreciation, $2 million of employee severance, and $4 million of other restructuring-related charges. ​ During the year ended December 31, 2020, the Company recorded a $35 million impairment charge with respect to its indefinite-lived intangible asset associated with the TIC Gums tradename, due to the Company's decision to change its marketing strategy related to the brand. Additionally, the Company recorded a $10 million other-than-temporary impairment of its equity method investment in Verdient for the year ended December 31, 2020, triggered by decrease in fair value on its equity method investment from the agreed upon purchase price to acquire the remaining 80% interest in Verdient. ​ For the year ended December 31, 2019, the Company recorded $57 million of pre-tax restructuring charges. Pre-tax restructuring charges of $28 million were recorded for the year ended December 31, 2019 for the Cost Smart SG&A program. These costs included $15 million of other costs, including professional services, and $13 million of employee-related severance for the year ended December 31, 2019. These charges were recorded primarily in the Company’s North America and South America operations, and include $2 million of other costs associated with the Finance Transformation initiative in Latin America for the year ended December 31, 2019. ​ Additionally, for the year ended December 31, 2019, the Company recorded $29 million for its Cost Smart Cost of sales program. For the year ended December 31, 2019, the Company recorded $15 million of restructuring charges in relation to the closure of the Lane Cove, Australia production facility, consisting of $10 million of accelerated depreciation, $4 million of employee-related severance, and $1 million of other costs. Additionally, for the year ended December 31, 2019, the Company recorded $3 million of employee-related expenses primarily related to South America operations restructuring. The Company also recorded $11 million of other costs, including professional services, for the year ended December 31, 2019, primarily in North America, including other costs of $2 million in relation to the prior year cessation of wet-milling at the Stockton, California manufacturing facility. ​ A summary of the Company’s severance accrual at December 31, 2020, is as follows (in millions): ​
​ | ​ | ​ | ​ | ​
Balance in severance accrual as of December 31, 2019 |  | $ | 15 | ​
Cost Smart Cost of sales and SG&A | ​ | ​ | 9 | ​
Acquisition related | ​ | ​ | 1 | ​
Payments made to terminated employees | ​ | ​ | (12) | ​
Foreign exchange translation | ​ | ​ | (1) | ​
Balance in severance accrual as of December 31, 2020 |  | $ | 12 | ​
​ Of the $12 million severance accrual at December 31, 2020, $11 million is expected to be paid within the next 12 months. ​ As of December 31, 2020, the Company identified certain assets within the Stockton, California and Lane Cove, Australia locations that met the held for sale criteria. The Company expects to sell these assets at a fair value equal to or greater than the carrying value as of December 31, 2020, and did not record a gain or loss associated with the reclassification of these assets to held for sale for the year ended December 31, 2020. The assets classified as held for sale are reflected in the Consolidated Balance Sheets as follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​
(in millions) | ​ | ​ | December 31, 2020 | ​ | December 31, 2019
Other assets |  | $ | 8 | ​ | $ | —
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- Definition The entire disclosure for restructuring and related activities. Description of restructuring activities such as exit and disposal activities, include facts and circumstances leading to the plan, the expected plan completion date, the major types of costs associated with the plan activities, total expected costs, the accrual balance at the end of the period, and the periods over which the remaining accrual will be settled. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 420 -URI http://asc.fasb.org/topic&trid=2175745 + Details
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