DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

3 Months Ended

Mar. 31, 2018

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

6.DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES

The Company is exposed to foreign currency exchange rate risks related primarily to its foreign business operations. During the three-months ended March 31, 2018 and the year ended December 31, 2017, the Company entered into forward currency exchange contracts with financial institutions to create an economic hedge to specifically manage a portion of the foreign exchange risk exposure associated with certain consolidated subsidiaries’ non-functional currency denominated assets and liabilities. All foreign currency exchange contracts of the Company that were outstanding as of March 31, 2018 have terms of one month or less. The Company does not enter into forward currency exchange contracts for speculation or trading purposes.

The Company has not designated its foreign currency exchange contracts as hedge transactions under ASC 815. Therefore, gains and losses on the Company’s foreign currency exchange contracts are recognized in interest and other income (expense), net, in the condensed consolidated statements of income, and are largely offset by the changes in the fair value of the underlying economically hedged item.

The notional amount and fair value of all outstanding foreign currency derivative instruments in the condensed consolidated balance sheets consist of the following at:

March 31, 2018
Derivatives not designated as hedging instruments under FASB ASC 815-20	Notional Amount		Fair Value		Balance Sheet Location
Assets:
Foreign currency exchange contracts:
Receive USD/pay GBP	$	33,290	$	139	Accounts receivable, net
Receive USD/pay ZAR	20,255		65		Accounts receivable, net
Receive NOK/pay USD	1,746		4		Accounts receivable, net
Liabilities:
Foreign currency exchange contracts:
Receive USD/pay EUR	$	76,452	$	(85)	Accrued liabilities
Receive USD/pay AUD	16,909		(73)		Accrued liabilities
Receive USD/pay MXN	3,337		(29)		Accrued liabilities
Receive SGD/pay USD	3,296		(15)		Accrued liabilities
Receive USD/pay NZD	2,237		(4)		Accrued liabilities
Receive USD/pay TRY	5,435		(83)		Accrued liabilities
Receive USD/pay BRL	717		(8)		Accrued liabilities
Receive USD/pay CLP	2,545		(3)		Accrued liabilities
Receive USD/pay COP	3,286		(3)		Accrued liabilities

December 31, 2017
Derivatives not designated as hedging instruments under FASB ASC 815-20	Notional Amount		Fair Value		Balance Sheet Location
Assets:
Foreign currency exchange contracts:
Receive CAD/pay USD	$	4,892	$	61	Accounts receivable, net
Receive SGD/pay USD	223		2		Accounts receivable, net
Receive NOK/pay USD	1,534		18		Accounts receivable, net
Receive USD/pay BRL	1,806		1		Accounts receivable, net
Receive USD/pay COP	2,803		13		Accounts receivable, net
Liabilities:
Foreign currency exchange contracts:
Receive USD/pay GBP	$	31,342	$	(334)	Accrued liabilities
Receive USD/pay EUR	65,131		(642)		Accrued liabilities
Receive USD/pay AUD	17,238		(177)		Accrued liabilities
Receive USD/pay ZAR	21,311		(222)		Accrued liabilities
Receive USD/pay MXN	7,720		(126)		Accrued liabilities
Receive USD/pay NZD	1,826		(18)		Accrued liabilities
Receive USD/pay TRY	5,483		(52)		Accrued liabilities
Receive USD/pay CLP	1,112		(8)		Accrued liabilities

The net (losses) gains on derivative instruments in the condensed consolidated statements of income were as follows:

		Amount of (loss) gain recognized in income on derivatives
		Three-months ended
Derivatives not designated as hedging instruments under FASB ASC 815-20	Location of (loss) gain recognized in income on derivatives	March 31, 2018		March 31, 2017
Foreign currency exchange contracts	Interest and other income, net	$	(4,659)	$	(5,028)