14.FINANCIAL INSTRUMENTS

We enter into forward exchange contracts to hedge the fair value exposure on inter-company loans. During the year ended September 30, 2018, this portfolio of forward exchange contracts consisted primarily of Japanese Yen and U.S. dollars as well as Euros and U.S. dollars. During the year ended September 30, 2017, this portfolio of forward exchange contracts consisted primarily of Korean Won and U.S. dollars. The maximum remaining term of any forward exchange contract outstanding at September 30, 2018 and 2017 was approximately 1 year. At September 30, 2018 and 2017, the total notional principal amount of our outstanding hedge contracts was $36.1 million and $158.4 million, respectively.

As of September 30, 2018 and 2017, there were no derivatives designated as hedging instruments. The tables below summarize the fair values of our derivatives not designated as hedging instruments and balance sheet location of these outstanding derivatives:



	September 30, 2018
	Balance Sheet Location	Amount		Balance Sheet Location	Amount
(In millions)
Forward exchange contracts	Other current assets	$	0.4	Payables and accrued liabilities	$	—



	September 30, 2017
	Balance Sheet Location	Amount		Balance Sheet Location	Amount
(In millions)
Forward exchange contracts	Other current assets	$	0.9	Payables and accrued liabilities	$	1.5

Refer to Note 13, Fair Value, which defines fair value, describes the method for measuring fair value, and provides additional disclosures regarding fair value measurements.

The table below summarizes the gain or loss related to our forward contracts:



	Year Ended September 30, 2018		Year Ended September 30, 2017
(In millions)
Forward Exchange Contracts, net of tax:
Net loss recognized in other (income) expense, net^(A)	$	0.4	$	2.2


^(A)	The impact of the non-designated hedges noted above was largely offset by gains and losses resulting from the impact of changes in exchange rates on recognized assets and liabilities denominated in nonfunctional currencies.

The cash flows related to all derivative contracts are reported in the operating activities section of the consolidated statements of cash flows.