Derivatives and Hedging

12 Months Ended

Dec. 31, 2015

Derivatives and Hedging

Derivatives and Hedging

7.     Derivatives and Hedging

        As of December 31, 2015, the company had total gross notional amounts of $793 million of foreign currency contracts and $9 million of commodity contracts outstanding relating to engineering and construction contract obligations and monetary assets and liabilities denominated in nonfunctional currencies. The foreign currency contracts are of varying duration, none of which extend beyond December 2019. The commodity contracts are of varying duration, none of which extend beyond December 2017. The impact to earnings due to hedge ineffectiveness was immaterial for the years ended December 31, 2015, 2014 and 2013.

        The fair values of derivatives designated as hedging instruments under ASC 815 as of December 31, 2015 and 2014 were as follows:

	Asset Derivatives					Liability Derivatives
(in thousands)	Balance Sheet Location	December 31, 2015		December 31, 2014		Balance Sheet Location	December 31, 2015		December 31, 2014
Commodity contracts	Other current assets	$	326	$	365	Other accrued liabilities	$	2,195	$	1,362
Foreign currency contracts	Other current assets		6,865		128	Other accrued liabilities		12,381		3,721
Commodity contracts	Other assets		15		196	Noncurrent liabilities		315		928
Foreign currency contracts	Other assets		1,574		52	Noncurrent liabilities		1,757		671
Total		$	8,780	$	741		$	16,648	$	6,682

        The pre-tax net gains (losses) recognized in earnings associated with the hedging instruments designated as fair value hedges for the years ended December 31, 2015, 2014 and 2013 were as follows:

Fair Value Hedges (in thousands)	Location of Gain (Loss)	2015			2014			2013
Foreign currency contracts	Corporate general and administrative expense	$	(5,191	)	$	(3,322	)	$	2,885

        The pre-tax amount of gain (loss) recognized in earnings on hedging instruments for the fair value hedges noted in the table above offset the amount of gain (loss) recognized in earnings on the hedged items in the same locations in the Consolidated Statement of Earnings.

        The after-tax amount of gain (loss) recognized in OCI and reclassified from AOCI into earnings associated with the derivative instruments designated as cash flow hedges for the years ended December 31, 2015, 2014 and 2013 was as follows:

	After-Tax Amount of Gain (Loss) Recognized in OCI										After-Tax Amount of Gain (Loss) Reclassified from AOCI into Earnings
Cash Flow Hedges (in thousands)	2015			2014			2013			Location of Gain (Loss)	2015			2014			2013
Commodity contracts	$	(728	)	$	(881	)	$	265		Total cost of revenue	$	(385	)	$	(59	)	$	50
Foreign currency contracts		(2,532	)		(1,270	)		(2,801	)	Total cost of revenue		(1,525	)		269			(2,855	)
Interest rate contracts		—			—			—		Interest expense		(1,049	)		(1,049	)		(1,049	)
Total	$	(3,260	)	$	(2,151	)	$	(2,536	)		$	(2,959	)	$	(839	)	$	(3,854	)