Derivatives and Hedging

3 Months Ended

Mar. 31, 2020

Derivative Instruments and Hedging Activities Disclosure [Abstract]

The Company enters into a limited number of derivative contracts to mitigate the cash flow risk associated with changes in interest rates on variable-rate debt and changes in foreign exchange rates on forecasted foreign currency transactions. The Company accounts for its outstanding derivative contracts in accordance with FASB ASC Topic 815, which requires all derivatives, including derivatives designated as accounting hedges, to be recorded on the balance sheet at fair value. The tables below provide information regarding the Company’s outstanding derivative contracts as of the dates indicated (in thousands, except for number of contracts).


March 31, 2020
Derivative Contract Type	Number of Contracts	Notional Amounts		Fair Value Asset (Liability), Net (3)		Balance Sheet Line Item	Unrealized Loss Recorded in AOCI/L
Interest rate swaps (1)	4	$	1,400,000	$	(126,317)	Other liabilities	$	(91,896)
Foreign currency forwards (2)	43	227,817		(559)		Accrued liabilities	—
Total	47	$	1,627,817	$	(126,876)		$	(91,896)


December 31, 2019
Derivative Contract Type	Number of Contracts	Notional Amounts		Fair Value Asset (Liability), Net (3)		Balance Sheet Line Item	Unrealized Loss Recorded in AOCI/L
Interest rate swaps (1)	4	$	1,400,000	$	(64,831)	Other liabilities	$	(47,164)
Foreign currency forwards (2)	176	604,858		59		Other current assets	—
Total	180	$	2,004,858	$	(64,772)		$	(47,164)

(1)The interest rate swaps have been designated and are accounted for as cash flow hedges of the forecasted interest payments on borrowings. As a result, changes in the fair values of the swaps are deferred and recorded in AOCI/L, net of tax effect. Note 7 — Debt provides additional information regarding the Company's interest rate swap contracts.

(2)The Company has foreign exchange transaction risk because it typically enters into transactions in the normal course of business that are denominated in foreign currencies that differ from the local functional currency. The Company enters into short-term foreign currency forward exchange contracts to mitigate the cash flow risk associated with changes in foreign currency rates on forecasted foreign currency transactions. These contracts are accounted for at fair value with realized and unrealized gains and losses recognized in Other income (expense), net because the Company does not designate these contracts as hedges for accounting purposes. All of the outstanding foreign currency forward exchange contracts at March 31, 2020 matured before April 30, 2020.

(3)See Note 11 — Fair Value Disclosures for the determination of the fair values of these instruments.

At March 31, 2020, all of the Company’s derivative counterparties were investment grade financial institutions. The Company did not have any collateral arrangements with its derivative counterparties and none of the derivative contracts contained credit-risk related contingent features. The table below provides information regarding amounts recognized in the accompanying Condensed Consolidated Statements of Operations for derivative contracts for the periods indicated (in thousands).


	Three Months Ended
	March 31,
Amount recorded in:	2020		2019
Interest (income) expense, net (1)	$	3,192	$	(2,271)
Other expense, net (2)	12,599		(1,838)
Total expense (income), net	$	15,791	$	(4,109)

(1)Consists of interest (income) expense from interest rate swap contracts.

(2)Consists of net realized and unrealized gains and losses on foreign currency forward contracts.