The Company addresses certain financial exposures that include the use of derivative financial instruments. The Company enters into foreign currency forward contracts to reduce the effects of fluctuating foreign currency exchange rates. As of January 31, 2023, the Company's net forward contracts hedging portfolio designated as qualified cash flow hedging instruments consisted of 3.0 million Euros equivalent with various expiry dates ranging through February 24, 2023. The net gain or loss on the derivatives is reported as a component of accumulated other comprehensive income/(loss) and reclassified into earnings in the same period during which the hedged transaction affects earnings using the same revenue or expense category that the hedged item impacted. The Company also enters into foreign currency forward contracts not designated as qualified hedges in accordance with ASC 815, Derivatives and Hedging. As of January 31, 2023, the Company’s net forward contracts hedging portfolio not designated as qualified hedges consisted of 14.7 million Chinese Yuan equivalent, 30.0 million Swiss Francs equivalent, 15.7 million US dollars equivalent, 19.8 million Euros equivalent and 0.6 million British Pounds equivalent with various expiry dates ranging through June 1, 2023. Changes in the fair value of these derivatives are recognized in earnings in the period they arise. Net gains or losses related to these forward contracts are included in cost of sales, selling and general and administrative expenses in the Consolidated Statements of Operations. The cash flows related to these foreign currency contracts are classified in operating activities.

The following table presents the fair values of the Company's derivative financial instruments included in the consolidated balance sheets as of January 31, 2023 and 2022 (in thousands):


	Asset Derivatives					Liability Derivatives
	Balance Sheet Location	January 31, 2023 Fair Value		January 31, 2022 Fair Value		Balance Sheet Location	January 31, 2023 Fair Value		January 31, 2022 Fair Value
Derivatives designated as hedging instruments:
Foreign Exchange Contracts	Other Current Assets	$	—	$	154	Accrued Liabilities	$	192	$	30
Total Derivative Instruments		$	—	$	154		$	192	$	30


	Asset Derivatives					Liability Derivatives
	Balance Sheet Location	January 31, 2023 Fair Value		January 31, 2022 Fair Value		Balance Sheet Location	January 31, 2023 Fair Value		January 31, 2022 Fair Value
Derivatives not designated as hedging instruments:
Foreign Exchange Contracts	Other Current Assets		1,146	$	43	Accrued Liabilities	$	—	$	140
Total Derivative Instruments		$	1,146	$	43		$	—	$	140

As of January 31, 2023 and 2022, the balance of net deferred gains on derivative financial instruments designated as cash flow hedges included in accumulated other comprehensive (loss) income were ($0.2) million and $0.2 million, respectively. For the fiscal years ended January 31, 2023 and 2022, the Company reclassified $2.1 million and zero, respectively, from accumulated other comprehensive income to Net sales in the Consolidated Statements of Operations. No ineffectiveness has been recorded in fiscal year 2023.

See Note 11 - Fair Value Measurements for further information about how fair value of derivative assets and liabilities are determined.