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RESTRUCTURING CHARGES

12 Months Ended

Jun. 30, 2018

Restructuring and Related Activities [Abstract]

RESTRUCTURING CHARGES

NOTE 11: RESTRUCTURING CHARGES

During fiscal year 2018, Adtalem recorded restructuring charges related to workforce reductions and real estate consolidations at the medical and veterinary schools, Becker Europe and Adtalem’s home office. At Adtalem Brazil, restructuring charges were recorded for the planned divestiture of the Sao Luis and Joao Pessoa institutions in fiscal year 2019. We also recorded a reduction to restructuring charges in fiscal year 2018 for an adjustment to previously accrued estimates for real estate consolidations at Adtalem’s home office. During fiscal year 2017, Adtalem recorded restructuring charges related to workforce reductions and real estate consolidations at the administrative support operations of the medical and veterinary schools and Adtalem’s home office. Termination benefit charges, as a result of reducing Adtalem’s workforce by 196 and 173 positions in fiscal years 2018 and 2017, respectively, represented severance pay and benefits for these employees. Adtalem’s home office is classified as “Home Office and Other” in “Note 16: Segment Information.” Pre-tax restructuring charges by segment were as follows (in thousands):

		Year Ended June 30, 2018												Year Ended June 30, 2017
		Real ‎Estate				Termination ‎Benefits				Total				Real ‎Estate				Termination ‎Benefits				Total
Medical and Healthcare		$	26			$	777			$	803			$	1,884			$	698			$	2,582
Professional Education			-				357				357				-				-				-
Technology and Business			1,216				-				1,216				-				-				-
Home Office and Other			(373	)			3,064				2,691				7,858				2,533				10,391
Total		$	869			$	4,198			$	5,067			$	9,742			$	3,231			$	12,973

The following table summarizes the separation and restructuring plan activity for the fiscal years 2018 and 2017, for which cash payments are required (in thousands):

Liability balance at June 30, 2016		$	48,223
Increase in liability (separation and other charges)			27,620
Reduction in liability (payments and adjustments)			(29,728	)
Liability balance at June 30, 2017			46,115
Increase in liability (separation and other charges)			19,893
Reduction in liability (payments and adjustments)			(27,081	)
Liability balance at June 30, 2018		$	38,927

Of this liability balance, $14.5 million is recorded as Accrued Liabilities and $24.4 million is recorded as Other Liabilities on the Consolidated Balance Sheet at June 30, 2018. These liability balances primarily represent rent accruals and costs for employees that have either not yet separated from Adtalem or their full severance has not yet been paid. All of these remaining costs are expected to be paid over the next 12 months except for rent charges which may be paid out for periods of up to 7 years.

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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

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