Derivative instruments

12 Months Ended

Jul. 31, 2015

Derivative instruments

7. Derivative instruments

Certain of our foreign operations have revenues and expenses transacted in currencies other than its functional currency. In order to mitigate foreign currency exchange risk, we use forward contracts to lock in exchange rates associated with a portion of our forecasted international expenses.

As of July 31, 2015, we have forward contracts outstanding with notional amounts totaling $10.1 million. These contracts are designated as cash flow hedges, and the unrealized loss of $0.4 million, net of tax, on these contracts are reported in Accumulated other comprehensive income as of July 31, 2015. Liability and asset derivatives designated as hedging instruments are presented in other assets and other liabilities, respectively, on our Consolidated Balance Sheets. At July 31, 2015 we had a derivative liability of $0.5 million included in other liabilities on our Consolidated Balance Sheet. As of July 31, 2014, we did not have outstanding forward contracts. Realized gains and (losses) on the cash flow hedges are recognized in income in the period when the payment of expenses is recognized. As of July 31, 2014, we did not have outstanding forward contracts. During fiscal year 2015 and 2014, we recorded approximately $(0.5) million of realized loss and $0.2 million of realized gain, respectively, included in in our Consolidated Statements of Operations.