XML 38 R23.htm IDEA: XBRL DOCUMENT v3.20.2
Financial Instruments
 6 Months Ended
Jun. 30, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Financial Instruments Financial Instruments
The Company uses an interest rate swap to manage its exposure to market risks for changes in interest rates.
Interest Rate Risk
The Company is exposed to interest rate risk on its debt obligations.  Interest income earned on cash and cash equivalents may fluctuate as interest rates change; however, due to their relatively short maturities, the Company does not hedge these assets or their investment cash flows because the impact of interest rate risk is not material. The Company's debt obligations consist of variable-rate and fixed-rate debt instruments (for further details, refer to Note 13. Debt).  The Company's primary objective is to achieve the lowest overall cost of funding while managing the variability in cash outflows within an acceptable range.  In order to achieve this objective, the Company has entered into an interest rate swap on the Term Loan.
Interest Rate Derivative – Cash Flow Hedge
The interest rate swap involves the periodic exchange of payments without the exchange of underlying principal or notional amounts. In October 2019, the Company entered into an interest rate lock agreement for a total notional amount of $1.3 billion to hedge part of the Company's interest rate exposure associated with the variability in future cash flows from changes in the one-month LIBOR associated with its Term Loan.
As of June 30, 2020, the total loss, net of income taxes, related to the Company’s cash flow hedge was $56 million, of which $28 million was recognized in accumulated other comprehensive loss and $28 million was recognized in non-controlling interests (none as of June 30, 2019).
A summary of the fair values of derivative instruments in the consolidated balance sheets was as follows (in thousands):
June 30, 2020December 31, 2019
Derivatives Designated as Hedging InstrumentsBalance Sheet
Classification		Fair ValueBalance Sheet
Classification		Fair Value
Variable-to-fixed interest rate swapOther long-term liabilities$56,058  Other assets$16,373