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Derivative Financial Instruments
 12 Months Ended
Dec. 31, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments
DERIVATIVE FINANCIAL INSTRUMENTS
 
The Company transacts business in various foreign countries and is therefore exposed to foreign currency exchange rate risk that impacts the reported U.S. Dollar amounts of revenues, costs, and certain foreign currency monetary assets and liabilities. In order to manage exposure to fluctuations in foreign currency and to reduce the volatility in earnings caused by fluctuations in foreign exchange rates, the Company enters into forward contracts to buy and sell foreign currency. By policy, the Company does not enter into these contracts for trading purposes or speculation.

Counterparty default risk is considered low because the forward contracts that the Company enters into are over-the-counter instruments transacted with highly-rated financial institutions. The Company was not required to and did not post collateral as of December 31, 2017 or 2016.

The Company’s derivative instruments are recorded at fair value as a derivative asset or liability in the consolidated balance sheets. The Company reports derivative instruments with the same counterparty on a net basis when a master netting arrangement is in place. Changes in fair value are recognized within ‘Foreign currency gain (loss), net’ in the consolidated statements of operations. For the consolidated statements of cash flows, the Company classifies cash flows from derivative instruments at settlement in the same category as the cash flows from the related hedged items within ‘Cash provided by operating activities.’

Results of Derivative Activities

The fair values of derivative assets and liabilities, net, all of which are classified as Level 2, reported within ‘Accrued expenses and other liabilities’ in the consolidated balance sheets were:
 
December 31, 2017
 
December 31, 2016
 
Derivative Assets
 
Derivative Liabilities
 
Derivative Assets
 
Derivative Liabilities
 
(in thousands)
Forward foreign currency exchange contracts

$
1,241

 
$
(1,647
)
 
$
6,541

 
$
(6,698
)
Netting of counterparty contracts
(1,241
)
 
1,241

 
(6,541
)
 
6,541

  Foreign currency forward contract derivatives
$
—

 
$
(406
)
 
$
—

 
$
(157
)


The notional amounts of outstanding foreign currency forward exchange contracts shown below report the total U.S. Dollar equivalent position and the net contract fair values for each foreign currency position.
 
December 31, 2017
 
December 31, 2016
 
Notional
 
Fair Value
 
Notional
 
Fair Value
 
(in thousands)
Singapore Dollar
$
73,455

 
$
364

 
$
94,763

 
$
(2,611
)
Euro
37,718

 
(122
)
 
71,228

 
(1,441
)
Japanese Yen
30,688

 
(89
)
 
87,171

 
4,180

South Korean Won
15,888

 
(134
)
 
8,278

 
407

British Pound Sterling
13,233

 
80

 
14,332

 
(660
)
Other currencies
53,698

 
(505
)
 
52,449

 
(32
)
Total
$
224,680

 
$
(406
)
 
$
328,221

 
$
(157
)
 
 
 
 
 
 
 
 
Latest maturity date
January 2018
 
 
January 2017
 

Amounts reported in ‘Foreign currency gain (loss), net’ in the consolidated statements of operations include both realized and unrealized gains (losses) from foreign currency transactions and derivative contracts and were as follows:
 
Year Ended December 31,
 
2017
 
2016
 
2015
 
(in thousands)
Foreign currency transaction gains
$
2,284

 
$
10,814

 
$
3,980

Foreign currency forward exchange contracts losses
(1,721
)
 
(13,268
)
 
(7,312
)
Foreign currency gain (loss), net
$
563

 
$
(2,454
)
 
$
(3,332
)