The Company’s risk management objective is to ensure that business exposures to risks are minimized using the most effective and efficient methods to eliminate, reduce, or transfer such exposures. Operating decisions consider these associated risks and, whenever possible, transactions are structured to avoid or mitigate these risks.

From time to time, the Company enters into FX Forward Contracts to manage the currency risks associated with forecasted transactions and assets/liabilities denominated in currencies other than the functional currency of certain subsidiaries. Certain of these FX Forward Contracts are designated as cash flow hedges. To the extent these derivatives are effective in offsetting the variability of the hedged cash flows, changes in the derivatives’ fair value are not included in current earnings but are included in AOCI. These changes in fair value are reclassified into earnings as a component of cost of sales, as applicable, when the forecasted transaction impacts earnings. In addition, if the forecasted transaction is no longer probable, the cumulative change in the derivatives’ fair value is recorded as a component of other income (expense) – net in the period in which the transaction is no longer considered probable of occurring. No amounts were recorded related to forecasted transactions no longer being probable during the years ended December 31, 2021, 2020 and 2019.

The Company had FX Forward Contracts with an aggregate notional amount of $11.3 million and $9.3 million outstanding as of December 31, 2021 and 2020, respectively. The aggregate notional amount outstanding as of December 31, 2021 is scheduled to mature within one year. The FX Forward Contracts purchased are denominated in various foreign currencies. As of December 31, 2021 and 2020, the net fair value of these contracts was a net short term liability of $0.3 million and zero, respectively. Net unrealized gains (losses), net of income tax, recorded in AOCI were zero as of December 31, 2021 and 2020.

The gains (losses) recorded in the Consolidated Statement of Operations for FX Forward Contracts for the years ended December 31, 2021 and 2020 are summarized as follows:


	Recognized Location	2021			2020			2019
Designated	Cost of sales	$	(1.1	)	$	(0.3	)	$	(3.1	)
Non-Designated	Other income (expense) - net		0.4			0.6			3.9