Annual report pursuant to Section 13 and 15(d)

Restructuring Charges

v3.5.0.2
Restructuring Charges
12 Months Ended
Jun. 30, 2016
Restructuring Charges [Abstract]  
Restructuring Charges
RESTRUCTURING CHARGES
The Company has in recent years undertaken a number of cost reduction activities, including workforce reductions, in an effort to lower its ongoing expense run rate. The program in the United States is accounted for in accordance with the authoritative guidance related to compensation for non-retirement post-employment benefits, whereas the programs in the Company’s international locations are accounted for in accordance with the authoritative guidance for contingencies.
During the fourth quarter of fiscal year ended 2015, the Company implemented a plan to reduce its global employee workforce to streamline the organization and business processes in response to changing customer requirements in the industry. The goals of this reduction were to enable continued innovation, direct the Company’s resources toward its best opportunities and lower its ongoing expense run rate. The Company substantially completed its global workforce reduction during the fiscal year ended June 31, 2016 and recorded an $8.9 million net restructuring charge, of which $3.6 million was recorded to costs of revenues, $1.6 million to research and development expense and $3.7 million to selling, general and administrative expense lines of the consolidated statements of operations. During the fiscal year ended June 30, 2015, the Company recorded a $31.6 million net restructuring charge, of which $8.0 million was recorded to costs of revenues, $11.1 million to research and development expense and $12.5 million to selling, general and administrative expense lines of the consolidated statements of operations.
The following table shows the activity primarily related to accrual for severance and benefits for the fiscal years ended June 30, 2016 and 2015:
 
Year ended June 30,
(In thousands)
2016
 
2015
Beginning balance
$
24,887

 
$
2,329

Restructuring costs
8,926

 
31,569

Adjustments
(142
)
 
1,177

Cash payments
(33,084
)
 
(10,188
)
Ending balance
$
587

 
$
24,887


The remaining accrual for severance and benefits as of June 30, 2016 is expected to be paid out by the end of the Company’s quarter ending December 31, 2016.