Derivative Financial Instruments

3 Months Ended

Jun. 30, 2012

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

Derivative Financial Instruments

Our foreign currency risk management strategy is principally designed to mitigate the future potential financial impact of changes in the value of transactions and balances denominated in foreign currency resulting from changes in foreign currency exchange rates. We enter into derivative transactions, specifically foreign currency forward contracts with maturities of up to three months, to manage our exposure to fluctuations in foreign exchange rates that arise primarily from our foreign currency-denominated receivables and payables.

Generally, we do not designate foreign currency forward contracts as hedges for accounting purposes, and changes in the fair value of these instruments are recognized immediately in earnings. Because we enter into forward contracts only as an economic hedge, any gain or loss on the underlying foreign-denominated balance would be offset by the loss or gain on the forward contract. Gains and losses on forward contracts and foreign denominated receivables and payables are included in other income (expense), net.

As of June 30, 2012 and September 30, 2011, we had outstanding forward contracts with notional amounts equivalent to the following:

Currency Hedged	June 30, 2012		September 30, 2011
	(in thousands)
Canadian Dollar / U.S. Dollar	$	82,188	$	92,748
Euro / U.S. Dollar	43,181		65,773
Chinese Renminbi / U.S. Dollar	4,192		19,973
Japanese Yen / U.S. Dollar	13,148		13,676
Swiss Franc / U.S. Dollar	—		9,419
British Pound / Euro	5,622		3,993
All other	7,199		7,350
Total	$	155,530	$	212,932

The accompanying consolidated balance sheets include a net liability of $1.0 million in accrued expenses and other current liabilities as of June 30, 2012, and a net asset of $5.5 million in other current assets as of September 30, 2011 related to the fair value of our forward contracts.

Net gains and losses on foreign currency exposures are recorded in other income (expense), net and include realized and unrealized gains and losses on forward contracts. Net gains and losses on foreign currency exposures for the three and nine months ended June 30, 2012 and July 2, 2011 were as follows:

	Three months ended					Nine months ended
	June 30, 2012			July 2, 2011		June 30, 2012		July 2, 2011
	(in thousands)
Net losses on foreign currency exposures	$	572		$	6,116	$	5,142	$	9,448
Net realized and unrealized (gain) loss on forward contracts (excluding the underlying foreign currency exposure being hedged)	$	(1,570	)	$	7,684	$	816	$	12,897