Note 7 — Restructuring Plans

In the first six months of 2014, Abbott management approved plans to streamline various operations in order to reduce costs and improve efficiencies in Abbott’s vascular, diagnostics and nutritional businesses. Abbott recorded employee related severance and other charges of approximately $80 million in 2014. Approximately $17 million is recognized in Cost of products sold, $41 million is recognized in Research and development and approximately $22 million is recognized in Selling, general and administrative expense. The following summarizes the activity for these restructurings:

(in millions)
Restructuring charges recorded in 2014	$	80
Payments and other adjustments	(20		)
Accrued balance at June 30, 2014	$	60

In 2014 and 2013, Abbott management approved plans to reduce costs and improve efficiencies across various functional areas. In 2013, Abbott management also approved plans to streamline certain manufacturing operations in order to reduce costs and improve efficiencies in Abbott’s established pharmaceuticals business. In 2012, Abbott management approved plans to streamline various commercial operations in order to reduce costs and improve efficiencies in Abbott’s core diagnostics, established pharmaceuticals and nutritionals businesses. Additional charges of approximately $76 million were recognized in 2014 of which approximately $2 million is recorded in Cost of products sold and approximately $74 million in Selling, general and administrative expense.

The following summarizes the activity for the first six months of 2014 related to these restructuring actions and the status of the related accrual as of June 30, 2014:

(in millions)
Accrued balance at December 31, 2013	$	148
Restructuring charges recorded in 2014	76
Payments and other adjustments	(42		)
Accrued balance at June 30, 2014	$	182

In 2013 and prior years, Abbott management approved plans to realign its vascular manufacturing operations in order to reduce costs. The following summarizes the activity for the first six months of 2014 related to these restructuring actions and the status of the related accrual as of June 30, 2014:

(in millions)
Accrued balance at December 31, 2013	$	20
Restructuring charges recorded in 2014	—
Payments and other adjustments	(1		)
Accrued balance at June 30, 2014	$	19

In 2011 and 2008, Abbott management approved plans to streamline global manufacturing operations, reduce overall costs, and improve efficiencies in Abbott’s core diagnostics business. The following summarizes the activity for the first six months of 2014 related to these restructuring actions and the status of the related accrual as of June 30, 2014:

(in millions)
Accrued balance at December 31, 2013	$	41
Restructuring charges recorded in 2014	—
Payments and other adjustments	(8		)
Accrued balance at June 30, 2014	$	33