Financial Derivatives

12 Months Ended

Dec. 31, 2015

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Financial Derivatives

Note 10. Financial Derivatives

Cash Flow Hedges — The Company has derivative assets and liabilities relating to outstanding forward contracts and options, designated as cash flow hedges, as defined under ASC 815 “Derivatives and Hedging” (“ASC 815”), consisting of Philippine Peso, Costa Rican Colon and Romanian Leu contracts. These contracts are entered into to protect against the risk that the eventual cash flows resulting from such transactions will be adversely affected by changes in exchange rates.

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

	December 31,
	2015			2014
Deferred gains (losses) in AOCI	$	(558	)	$	(157	)
Tax on deferred gains (losses) in AOCI		31			46
Deferred gains (losses) in AOCI, net of taxes	$	(527	)	$	(111	)
Deferred gains (losses) expected to be reclassified to “Revenues” from AOCI during the next twelve months	$	(558	)

Deferred gains (losses) and other future reclassifications from AOCI will fluctuate with movements in the underlying market price of the forward contracts and options.

Net Investment Hedge — The Company enters into foreign exchange forward contracts to hedge its net investment in certain foreign operations, as defined under ASC 815. The purpose of these derivative instruments is to protect the Company’s interests against the risk that the net assets of certain foreign subsidiaries will be adversely affected by changes in exchange rates and economic exposures related to the Company’s foreign currency-based investments in these subsidiaries.

Non-Designated Hedges — The Company also periodically enters into foreign currency hedge contracts that are not designated as hedges as defined under ASC 815. The purpose of these derivative instruments is to protect the Company’s interests against adverse foreign currency moves relating primarily to intercompany receivables and payables, and other assets and liabilities that are denominated in currencies other than the Company’s subsidiaries’ functional currencies. These contracts generally do not exceed 180 days in duration. See Note 1, Overview and Summary of Significant Accounting Policies, for additional information on the Company’s purpose for entering into derivatives not designated as hedging instruments and its overall risk management strategies.

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

	As of December 31, 2015				As of December 31, 2014
Contract Type	Notional Amount in USD		Settle Through Date		Notional Amount in USD		Settle Through Date
Cash flow hedges:
Options:
Philippine Pesos	$	71,750		December 2016	$	73,000		December 2015
Forwards:
Costa Rican Colones		34,500		November 2016		51,600		October 2015
Romanian Leis		—		—		10,414		December 2015
Philippine Pesos		—		—		9,000		March 2015
Net investment hedges:
Forwards:
Euros		63,470		March 2016		51,648		March 2016
Non-designated hedges:
Forwards		50,603		March 2016		64,541		March 2015

Master netting agreements exist with each respective counterparty to reduce credit risk by permitting net settlement of derivative positions. In the event of default by the Company or one of its counterparties, these agreements include a set-off clause that provides the non-defaulting party the right to net settle all derivative transactions, regardless of the currency and settlement date. The maximum amount of loss due to credit risk that, based on gross fair value, the Company would incur if parties to the derivative transactions that make up the concentration failed to perform according to the terms of the contracts was $11.0 million and $5.5 million as of December 31, 2015 and 2014, respectively. After consideration of these netting arrangements and offsetting positions by counterparty, the total net settlement amount as it relates to these positions are asset positions of $10.2 million and $4.4 million, and liability positions of $0.1 million and $0.1 million as of December 31, 2015 and 2014, respectively.

Although legally enforceable master netting arrangements exist between the Company and each counterparty, the Company has elected to present the derivative assets and derivative liabilities on a gross basis in the accompanying Consolidated Balance Sheets. Additionally, the Company is not required to pledge, nor is it entitled to receive, cash collateral related to these derivative transactions.

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

	Derivative Assets
	December 31, 2015		December 31, 2014
	Fair Value		Fair Value
Derivatives designated as cash flow hedging instruments under ASC 815:
Foreign currency forward and option contracts (1)	$	544	$	974
Derivatives designated as net investment hedging instruments under ASC 815:
Foreign currency forward contracts (1)		10,161		—
Foreign currency forward contracts (2)		—		4,060
		10,705		5,034
Derivatives not designated as hedging instruments under ASC 815:
Foreign currency forward contracts (1)		257		515
Total derivative assets	$	10,962	$	5,549
	Derivative Liabilities
	December 31, 2015		December 31, 2014
	Fair Value		Fair Value
Derivatives designated as cash flow hedging instruments under ASC 815:
Foreign currency forward and option contracts (3)	$	396	$	406
Derivatives not designated as hedging instruments under ASC 815:
Foreign currency forward contracts (3)		439		855
Total derivative liabilities	$	835	$	1,261

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

⁽²⁾ Included in “Deferred charges and other assets” in the accompanying Consolidated Balance Sheets.

⁽³⁾ Included in “Other accrued expenses and current liabilities” in the accompanying Consolidated Balance Sheets.

The following tables present the effect of the Company’s derivative instruments included in the accompanying Consolidated Financial Statements for the years ended December 31, 2015, 2014 and 2013 (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 and Amount Excluded from Effectiveness Testing)
	December 31,								December 31,								December 31,
	2015		2014			2013			2015		2014			2013			2015		2014			2013
Derivatives designated as cash flow hedging instruments under ASC 815:
Foreign currency forward and option contracts	$	1,696	$	(2,787	)	$	(2,823	)	$	2,138	$	(5,339	)	$	(666	)	$	12	$	(3	)	$	119
Derivatives designated as net investment hedging instruments under ASC 815:
Foreign currency forward contracts		6,101		6,344			(1,720	)		—		—			—			—		—			—
Foreign currency forward and option contracts	$	7,797	$	3,557		$	(4,543	)	$	2,138	$	(5,339	)	$	(666	)	$	12	$	(3	)	$	119

	Gain (Loss) Recognized  in “Other income (expense)” on Derivatives
	December 31,
	2015		2014			2013
Derivatives not designated as hedging instruments under ASC 815:
Foreign currency forward contracts	$	1,374	$	(44	)	$	4,216