(7) Severance

Periodically, we have implemented reductions in our workforce and have accrued liabilities for related severance costs. These workforce reductions resulted primarily from the progression or completion of our integration plans related to CenturyLink's indirect acquisition of us, increased competitive pressures and reduced workload demands due to the loss of access lines.

We report severance liabilities within "accrued expenses and other liabilities—salaries and benefits" in our consolidated balance sheets and report severance expenses in cost of services and products and selling, general and administrative expenses in our consolidated statements of operations.

Changes in our accrued liability for severance expenses were as follows:

	Severance

	(Dollars in millions)
Balance at December 31, 2010 (Predecessor)	$	28
Accrued to expense		3
Payments, net		(11	)
Reversals and adjustments		(1	)
Balance at March 31, 2011 (Predecessor)	$	19

Fair value adjustment		(2	)

Balance at April 1, 2011 (Successor)	$	17
Accrued to expense		118
Payments, net		(97	)
Reversals and adjustments		(9	)

Balance at December 31, 2011 (Successor)		29
Accrued to expense		64
Payments, net		(85	)
Reversals and adjustments		(1	)

Balance at December 31, 2012 (Successor)	$	7

Our severance expenses for the successor nine months ended December 31, 2011 also included $12 million of share-based compensation associated with the accelerated vesting of stock awards that occurred in connection with workforce reductions relating to CenturyLink's indirect acquisition of us.