NOTE 13: RESTRUCTURING LIABILITIES

Charges for restructuring activities are recorded in the period in which Kodak commits to a formalized restructuring plan, or executes the specific actions contemplated by the plan, and all criteria for liability recognition under the applicable accounting guidance have been met. Restructuring actions taken in the first nine months of 2018 were initiated to reduce Kodak’s cost structure as part of its commitment to drive sustainable profitability and included various targeted reductions in manufacturing, service, sales, research and development, and other administrative functions.

Restructuring Reserve Activity

The activity in the accrued balances and the non-cash charges and credits incurred in relation to restructuring activities for the nine months ended September 30, 2018 were as follows:

(in millions)	Severance Reserve ⁽¹⁾			Exit Costs Reserve ⁽¹⁾			Long-lived Asset Impairments and Inventory Write-downs ⁽¹⁾		Total
Balance as of December 31, 2017	$	6		$	4		$	—	$	10
Q1 charges		2			—			—		2
Q1 utilization/cash payments		(4	)		—			—		(4	)
Balance as of March 31, 2018	$	4		$	4		$	—	$	8
Q2 charges	$	2		$	—		$	—	$	2
Q2 utilization/cash payments		(3	)		(2	)		—		(5	)
Q2 other adjustments and reclasses ⁽²⁾		(1	)		—			—		(1	)
Balance as of June 30, 2018	$	2		$	2		$	—	$	4
Q3 charges	$	9		$	—		$	—	$	9
Q3 utilization/cash payments		(2	)		—			—		(2	)
Q3 other adjustments and reclasses ⁽²⁾		(3	)		—			—		(3	)
Balance as of September 30, 2018	$	6		$	2		$	—	$	8

⁽¹⁾	The severance and exit costs reserves require the outlay of cash, while long-lived asset impairments and inventory write-downs represent non-cash items.

⁽²⁾Represents severance charges funded from pension plan assets, which were reclassified to Pension and other postretirement liabilities.

For the three months ended September 30, 2018 the $9 million of charges were reported as Restructuring costs and other.

The severance costs for the three months ended September 30, 2018 related to the elimination of approximately 100 positions including approximately 15 manufacturing/service positions, 20 research and development positions, and 65 administrative and sales positions. The geographic composition of these positions includes approximately 75 in the United States and Canada and 25 throughout the rest of the world.

For the nine months ended September 30, 2018 the $13 million of charges were reported as Restructuring costs and other.

The severance costs for the nine months ended September 30, 2018 related to the elimination of approximately 175 positions including approximately 55 manufacturing/service positions, 25 research and development positions, and 95 administrative and sales positions. The geographic composition of these positions includes approximately 110 in the United States and Canada and 65 throughout the rest of the world.

As a result of these initiatives, approximately $2 million of the severance will be paid during periods through the end of 2019. The rest of the severance will be paid during periods through the end of the first quarter of 2019.