Financial Derivatives (Tables)

9 Months Ended

Sep. 30, 2012

Deferred Gains (Losses) and Related Taxes on Derivative Instruments

The deferred gains (losses) and related taxes on the Company’s derivative instruments recorded in “Accumulated other comprehensive income (loss)” in the accompanying Condensed Consolidated Balance Sheets are as follows (in thousands):


	September 30, 2012			December 31, 2011
Deferred gains (losses) in AOCI	$	1,076		$	(670	)
Tax on deferred gains (losses) in AOCI		(175	)		232

Deferred gains (losses) in AOCI, net of taxes	$	901		$	(438	)

Deferred gains (losses) expected to be reclassified to “Revenues” from AOCI during the next twelve months	$	1,076

Outstanding Foreign Currency Forward Contracts and Options

The Company had the following outstanding foreign currency forward contracts and options (in thousands):

As of September 30, 2012

As of December 31, 2011

Contract Type

Notional
Amount in
USD

Settle Through
Date

Notional
Amount in
USD

Settle Through
Date

Cash flow hedges: ⁽¹⁾

Options:

Philippine Pesos

57,000

May 2013

85,500

September 2012

Forwards:

Philippine Pesos

3,000

October 2012

12,000

March 2012

Costa Rican Colones

53,000

September 2013

30,000

September 2012

Non-designated hedges: ⁽²⁾

Forwards

42,992

January 2013

27,192

March 2012

⁽¹⁾	Cash flow hedge as defined under ASC 815. Purpose is to protect against the risk that eventual cash flows resulting from such transactions will be adversely affected by changes in exchange rates.

⁽²⁾

Foreign currency hedge contract not designated as a hedge as defined under ASC 815. Purpose is to reduce the effects on the Company’s operating results and cash flows from fluctuations caused by volatility in currency exchange rates, primarily related to intercompany loan payments and cash held in non-functional currencies.

Derivative Instruments Fair Value

The following tables present the fair value of the Company’s derivative instruments included in the accompanying Condensed Consolidated Balance Sheets (in thousands):


	Derivative Assets
	September 30, 2012		December 31, 2011
	Fair Value		Fair Value
Derivatives designated as cash flow hedging instruments under ASC 815:
Foreign currency forward and option contracts ⁽¹⁾	$	2,125	$	704
Derivatives not designated as hedging instruments under ASC 815:
Foreign currency forward contracts ⁽¹⁾		40		6

Total derivative assets	$	2,165	$	710


	September 30, 2012		December 31, 2011
	Fair Value		Fair Value
Derivatives designated as cash flow hedging instruments under ASC 815:
Foreign currency forward and option contracts ⁽²⁾	$	704	$	485
Derivatives not designated as hedging instruments under ASC 815:
Foreign currency forward contracts ⁽²⁾		25		267

Total derivative liabilities	$	729	$	752

⁽¹⁾	Included in “Other current assets” in the accompanying Condensed Consolidated Balance Sheets.

⁽²⁾	Included in “Other accrued expenses and current liabilities” in the accompanying Condensed Consolidated Balance Sheets.

Effect of the Company's Derivative Instruments

The following tables present the effect of the Company’s derivative instruments included in the accompanying Condensed Consolidated Financial Statements for the three months ended September 30, 2012 and 2011 (in thousands):


	Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)					Gain (Loss) Reclassified From Accumulated AOCI Into “Revenues” (Effective Portion)				Gain (Loss) Recognized in “Revenues” on Derivatives (Ineffective Portion)
	September 30,					September 30,				September 30,
	2012		2011			2012		2011		2012		2011
Derivatives designated as cash flow hedging instruments under ASC 815:
Foreign currency forward and option contracts	$	127	$	(1,993	)	$	1,631	$	1,378	$	—	$	—


	Gain (Loss) Recognized in “Other income and (expense)” on Derivatives
	September 30,
	2012			2011
Derivatives not designated as hedging instruments under ASC 815:
Foreign currency forward contracts	$	(849	)	$	3,835

The following tables present the effect of the Company’s derivative instruments included in the accompanying Condensed Consolidated Financial Statements for the nine months ended September 30, 2012 and 2011 (in thousands):


	Gain (Loss) Recognized in AOCI on Derivatives (Effective Portion)					Gain (Loss) Reclassified From Accumulated AOCI Into “Revenues” (Effective Portion)				Gain (Loss) Recognized in “Revenues” on Derivatives (Ineffective Portion)
	September 30,					September 30,				September 30,
	2012		2011			2012		2011		2012		2011
Derivatives designated as cash flow hedging instruments under ASC 815:
Foreign currency forward and option contracts	$	4,090	$	(2,933	)	$	2,290	$	2,430	$	17	$	—


	Gain (Loss) Recognized in “Other income and (expense)” on Derivatives
	September 30,
	2012			2011
Derivatives not designated as hedging instruments under ASC 815:
Foreign currency forward contracts	$	(1,046	)	$	103

- Definition

Tabular disclosure of the location and amount of gains and losses reported in the statement of financial performance, or when applicable, the statement of financial position. For example, (a) gains and losses recognized in the income statement on derivative instruments designated and qualifying as hedging instruments in fair value hedges and related hedged items designated and qualifying in fair value hedges and (b) gains and losses initially recognized in other comprehensive income on derivative instruments designated and qualifying as cash flow hedges.

+ References+ Details

- Definition

Tabular disclosure of the location and fair value amounts of derivative instruments (and nonderivative instruments that are designated and qualify as hedging instruments) reported in the statement of financial position.

+ References+ Details