11.

Accumulated Other Comprehensive Income (Loss)

In 2013, Mattel adopted Accounting Standards Update 2013-02, Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income, which requires an entity to present either on the face of the statement where net income is presented or in the notes to the financial statements, significant amounts reclassified out of accumulated other comprehensive income by the respective line items of net income. The following tables present changes in the accumulated balances for each component of other comprehensive income, including current period other comprehensive income and reclassifications out of accumulated other comprehensive income:


	For the Three Months Ended June 30, 2013
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2013	$	4,426		$	(187,225	)	$	(298,626	)	$	(481,425	)
Other comprehensive (loss) income before reclassifications		(872	)		314			(37,383	)		(37,941	)
Amounts reclassified from accumulated other comprehensive income (loss)		326			3,120			—			3,446

Net (decrease) increase in other comprehensive income		(546	)		3,434			(37,383	)		(34,495	)

Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2013	$	3,880		$	(183,791	)	$	(336,009	)	$	(515,920	)


	For the Six Months Ended June 30, 2013
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2012	$	(2,583	)	$	(190,656	)	$	(271,247	)	$	(464,486	)
Other comprehensive income (loss) before reclassifications		7,266			625			(64,762	)		(56,871	)
Amounts reclassified from accumulated other comprehensive income (loss)		(803	)		6,240			—			5,437

Net increase (decrease) in other comprehensive income		6,463			6,865			(64,762	)		(51,434	)

Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2013	$	3,880		$	(183,791	)	$	(336,009	)	$	(515,920	)


	For the Three Months Ended June 30, 2012
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2012	$	18,890		$	(170,875	)	$	(243,560	)	$	(395,545	)
Other comprehensive income (loss) before reclassifications		11,968			(1,756	)		(73,654	)		(63,442	)
Amounts reclassified from accumulated other comprehensive income (loss)		(4,328	)		4,084			—			(244	)

Net increase (decrease) in other comprehensive income		7,640			2,328			(73,654	)		(63,686	)

Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2012	$	26,530		$	(168,547	)	$	(317,214	)	$	(459,231	)


	For the Six Months Ended June 30, 2012
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2011	$	24,616		$	(172,398	)	$	(298,863	)	$	(446,645	)
Other comprehensive income (loss) before reclassifications		10,780			(4,311	)		(18,351	)		(11,882	)
Amounts reclassified from accumulated other comprehensive income (loss)		(8,866	)		8,162			—			(704	)

Net increase (decrease) in other comprehensive income		1,914			3,851			(18,351	)		(12,586	)

Accumulated Other Comprehensive Income (Loss), Net of Tax, as of June 30, 2012	$	26,530		$	(168,547	)	$	(317,214	)	$	(459,231	)

The following table presents the classification and amount of the reclassifications from accumulated other comprehensive income to the statement of operations:


	For the Three Months Ended June 30, 2013			For the Three Months Ended June 30, 2012			Statements of Operations Classification
	(In thousands)
Derivative Instruments
(Loss) Gain on foreign currency forward exchange contracts	$	(318	)	$	4,409		Cost of sales
		(8	)		(81	)	Provision for income taxes

	$	(326	)	$	4,328		Net income

Amortization of Defined Benefit Pension Plans
Prior service credit (cost)	$	126		$	(11	)	(a)
Actuarial loss		(5,146	)		(5,772	)	(a)

		(5,020	)		(5,783	)
		1,900			1,699		Provision for income taxes

	$	(3,120	)	$	(4,084	)	Net income



	For the Six Months Ended June 30, 2013			For the Six Months Ended June 30, 2012			Statements of Operations Classification
	(In thousands)
Derivative Instruments
Gain on foreign currency forward exchange contracts	$	813		$	9,032		Cost of sales
		(10	)		(166	)	Provision for income taxes

	$	803		$	8,866		Net income


Amortization of Defined Benefit Pension Plans
Prior service credit (cost)	$	252		$	(21	)	(a)
Actuarial loss		(10,292	)		(11,540	)	(a)

		(10,040	)		(11,561	)
		3,800			3,399		Provision for income taxes

	$	(6,240	)	$	(8,162	)	Net income

(a)

The amortization of prior service credit (cost) and actuarial loss is included in the computation of net periodic benefit cost. Refer to “Note 15 to the Consolidated Financial Statements—Employee Benefit Plans” of this Quarterly Report on Form 10-Q for additional information regarding Mattel’s net periodic benefit cost.

Currency Translation Adjustments

Mattel’s reporting currency is the US dollar. The translation of its net investments in subsidiaries with non-US dollar functional currencies subjects Mattel to currency exchange rate fluctuations in its results of operations and financial position. Assets and liabilities of subsidiaries with non-US dollar functional currencies are translated into US dollars at fiscal period-end exchange rates. Income, expense, and cash flow items are translated at weighted average exchange rates prevailing during the fiscal period. The resulting currency translation adjustments are recorded as a component of accumulated other comprehensive loss within stockholders’ equity. Currency translation adjustments resulted in a net loss of $64.8 million for the six months ended June 30, 2013, primarily due to the weakening of the Euro, Brazilian real, British pound sterling, and Australian dollar against the US dollar. Currency translation adjustments resulted in a net loss of $18.4 million for the six months ended June 30, 2012, primarily due to weakening of the Euro and Brazilian real against the US dollar.