XML 31 R17.htm IDEA: XBRL DOCUMENT v3.22.0.1
RESTRUCTURING AND INTEGRATION EXPENSE
 12 Months Ended
Dec. 31, 2021
Restructuring and Related Activities [Abstract]  
RESTRUCTURING AND INTEGRATION EXPENSE
Restructuring and integration expense consists of costs related to the consolidation and migration of certain applications and processes, including our financial and sales management systems. It also includes costs related to the integration of acquired businesses into our systems and processes. These costs primarily consist of information technology consulting, project management services and internal labor, as well as other costs associated with our initiatives, such as training, travel and relocation and costs associated with facility closures. In addition, we recorded employee severance costs related to these initiatives, as well as our ongoing cost reduction initiatives across functional areas. We are currently pursuing several initiatives designed to focus on our growth strategy and to increase our efficiency. Restructuring and integration expense is not allocated to our reportable business segments.

Restructuring and integration expense is reflected on the consolidated statements of income (loss) as follows for the years ended December 31:
(in thousands)202120202019
Total cost of revenue$4,197 $3,465 $3,562 
Operating expenses54,750 75,874 71,248 
Restructuring and integration expense$58,947 $79,339 $74,810 

Restructuring and integration expense was comprised of the following for the years ended December 31:
(in thousands)202120202019
External consulting fees$26,676 $44,096 $45,638 
Employee severance benefits9,076 17,628 10,865 
Internal labor7,948 7,568 12,115 
Other15,247 10,047 6,192 
Restructuring and integration expense$58,947 $79,339 $74,810 
Our restructuring and integration accruals are included in accrued liabilities on the consolidated balance sheets and represent expected cash payments required to satisfy the remaining severance obligations to those employees already terminated and those expected to be terminated under our various initiatives. The majority of the employee reductions are expected to be completed in the first quarter of 2022, and we expect most of the related severance payments to be paid in the first half of 2022, utilizing cash from operations.

Changes in our restructuring and integration accruals were as follows:
(in thousands)Employee severance benefitsOperating lease obligationsTotal
Balance, December 31, 2018$3,179 $282 $3,461 
Charges11,516 — 11,516 
Reversals(651)— (651)
Payments(10,585)— (10,585)
Adoption of ASU No. 2016-02(1)
— (282)(282)
Balance, December 31, 20193,459 — 3,459 
Charges19,025 — 19,025 
Reversals(1,397)— (1,397)
Payments(14,289)— (14,289)
Balance, December 31, 20206,798 — 6,798 
Charges10,897 — 10,897 
Reversals(1,821)— (1,821)
Payments(10,202)— (10,202)
Balance, December 31, 2021$5,672 $— $5,672 

(1) Upon adoption of ASU No. 2016-02, Leasing, and related amendments on January 1, 2019, our operating lease obligation accrual was reversed and the related operating lease asset was analyzed for impairment in accordance with the new guidance.

The charges and reversals presented in the rollforward of our restructuring and integration accruals do not include items charged directly to expense as incurred, as those items are not reflected in accrued liabilities on the consolidated balance sheets.

Chief Executive Officer (CEO) transition costs – In 2018, we announced the retirement of our former CEO. In connection with the transition, we incurred various costs, including retention payments to certain members of our management team, consulting fees related to the evaluation of our strategy and our current CEO's signing bonus. These costs totaled $9,390 for 2019 and were included in SG&A expense on the consolidated statement of loss.