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Restructuring and integration expense | 9 Months Ended
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Sep. 30, 2024
Restructuring and Related Activities [Abstract] |
Restructuring and integration expense |
NOTE 9: RESTRUCTURING AND INTEGRATION EXPENSE
Restructuring and integration expense consists of costs related to initiatives to drive earnings and cash flow growth and also includes costs related to the consolidation and migration of certain applications and processes. These costs consist primarily of consulting, project management services and internal labor, as well as other costs associated with our initiatives, such as costs related to facility closures and consolidations. In addition, we have recorded employee severance costs across functional areas. Restructuring and integration expense is not allocated to our reportable business segments. We are currently pursuing several initiatives designed to support our growth strategy and to increase our efficiency, including several initiatives that we collectively refer to as our North Star program. The goal of these initiatives is to further drive shareholder value by (1) expanding our EBITDA growth trajectory, (2) increasing cash flow, (3) paying down debt, and (4) improving our leverage ratio. Our various initiatives include a balanced mix of structural cost reductions focused on organizational structure, processes and operational improvements, in addition to workstreams to drive revenue growth. As part of these initiatives, we have already combined like-for-like capabilities, reduced management layers and consolidated core operations to run more efficiently and to create the ability to invest in high impact talent to accelerate our growth businesses of payments and data. The associated expense, which consisted primarily of consulting and severance costs, was approximately $11,000 during the quarter ended September 30, 2024 and $20,000 during the quarter ended September 30, 2023. For the nine months ended September 30, 2024 and September 30, 2023, the associated expense was approximately $33,000 and $35,000, respectively. To date, we have incurred expense of approximately $80,000, and we anticipate that we will incur additional North Star restructuring and integration expense of approximately $30,000 through 2025. Restructuring and integration expense is reflected on the consolidated statements of comprehensive income (loss) as follows:
|  | Quarter Ended September 30, |  | Nine Months Ended September 30,
(in thousands) |  | 2024 |  | 2023 |  | 2024 |  | 2023
Total cost of revenue |  | $ | 234 |  |  | $ | 6,429 |  |  | $ | 1,132 |  |  | $ | 10,868 |
Operating expenses |  | 11,031 |  |  | 22,935 |  |  | 35,899 |  |  | 60,067 |
Restructuring and integration expense |  | $ | 11,265 |  |  | $ | 29,364 |  |  | $ | 37,031 |  |  | $ | 70,935 |
Restructuring and integration expense for each period was comprised of the following:
|  | Quarter Ended September 30, |  | Nine Months Ended September 30,
(in thousands) |  | 2024 |  | 2023 |  | 2024 |  | 2023
External consulting and other costs |  | $ | 8,614 |  |  | $ | 10,939 |  |  | $ | 25,733 |  |  | $ | 31,561 |
Employee severance benefits |  | 902 |  |  | 11,179 |  |  | 2,459 |  |  | 17,526 |
Internal labor |  | 381 |  |  | 2,469 |  |  | 1,602 |  |  | 6,341 |
Other |  | 1,368 |  |  | 4,777 |  |  | 7,237 |  |  | 15,507 |
Restructuring and integration expense |  | $ | 11,265 |  |  | $ | 29,364 |  |  | $ | 37,031 |  |  | $ | 70,935 |
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, as well as the related severance payments, are expected to be completed by mid-2025. Changes in our restructuring and integration accruals were as follows:
(in thousands) |  | Employee severance benefits
Balance, December 31, 2023 |  | $ | 9,689 |
Charges |  | 2,961 |
Reversals |  | (502) |
Payments |  | (9,212) |
Balance, September 30, 2024 |  | $ | 2,936 |
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.

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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://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section S99 -Paragraph 2 -Subparagraph (SAB Topic 5.P.4.e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147479823/420-10-S99-2 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (b)(2) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482017/420-10-50-1 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482017/420-10-50-1 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/420/tableOfContent Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 420 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (e) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482017/420-10-50-1 + Details
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