Note 5 — Reorganization

In the first quarter of 2015, the Company implemented a reduction in its workforce of approximately 4% of its employees across various geographies and functions, in order to reallocate investment in 2015 to planned sales expansion and to delivery areas seeing the greatest client demand. Overall the Company expects to increase its headcount by 7% at the end of 2015 compared to 2014 levels. The Company incurred $3.4 million of severance and related costs for this action during the three months ended March 31, 2015 and expects to incur an additional $0.3 million to $0.5 million during the three months ended June 30, 2015 primarily for a non-cash charge for the liquidation of a small non-U.S. subsidiary. The costs under this plan are expected to be substantially paid by the end of 2015.

During 2014 the Company incurred $1.8 million of severance and related costs for the termination of approximately 1% of its employees across various geographies and functions primarily to realign resources due to the Company’s new organizational structure put in place in late 2013. Approximately $0.8 million of the costs were recognized in the three months ended March 31, 2014 and approximately $1.0 million were recognized in the three months ended June 30, 2014.

The following table rolls forward the activity in the reorganization accrual for the three months ended March 31, 2015 (in thousands):


	Workforce Reduction
Accrual at December 31, 2014	$	118
Additions		3,424
Cash payments		(1,046	)

Accrual at March 31, 2015	$	2,496