Derivative Instruments

12 Months Ended

Dec. 31, 2011

Derivative Instruments

Derivative Instruments

Note 5—Derivative Instruments

The Company is exposed to certain risks related to its ongoing business operations.  The primary risks managed by using derivative instruments are foreign exchange rate risk and interest rate risk. Foreign exchange rate forward contacts were entered into in 2011 to manage the currency exposure on an intercompany loan used to fund an acquisition. The hedge will terminate in November 2012 upon maturity of the intercompany loan. In the past, the Company has used interest rate swaps to manage interest rate risk associated with variable rate borrowings, all of which expired in 2010.

Derivative instruments are required to be recognized as either assets or liabilities at fair value in the Consolidated Balance Sheets. The Company designates foreign exchange rate forward contacts as cash flow hedges.

As of December 31, 2011 and 2010, the Company had the following derivative activity related to cash flow hedges:

		Fair Value Assets
	Balance Sheet Location	December 31, 2011		December 31, 2010
Derivatives designated as cash flow hedges:
Forward contracts	Other current assets	$	5,105	$	—
Total derivatives designated as cash flow hedging instruments		$	5,105	$	—

For the year ended December 31, 2011, $(287) was recognized in accumulated other comprehensive income (loss) associated with foreign exchange rate forward contracts. For the year ended December 31, 2010, $(2,363) was recognized in accumulated other comprehensive income (loss) associated with previously existing interest rate contracts. The amount reclassified from accumulated other comprehensive income (loss) to foreign exchange gain/loss in the accompanying Consolidated Statements of Income during the year ended December 31, 2011 was not material.