Derivative Instruments

6 Months Ended

May 31, 2011

Derivative Instruments [Abstract]

Derivative Instruments

Note 6: Derivative Instruments

We generally use foreign currency option contracts that are not designated as hedging instruments to hedge economically a portion of forecasted international cash flows for up to one year in the future. All foreign currency option contracts are recorded at fair value in other current assets on the balance sheet at the end of each reporting period and expire within one year. In the second quarter and first six months of fiscal 2011, mark-to-market losses of approximately $0.1 million and $0.5 million, respectively, on foreign currency option contracts were recorded in other income in the statement of operations.

We also use forward contracts that are not designated as hedging instruments to hedge economically the impact of the variability in exchange rates on accounts receivable and collections denominated in certain foreign currencies. We generally do not hedge the net assets of our international subsidiaries. All forward contracts are recorded at fair value in other current assets on the balance sheet at the end of each reporting period and expire within 90 days. In the second quarter and first six months of fiscal 2011, realized and unrealized losses of $1.4 million and $2.0 million, respectively, from our forward contracts were recognized in other income in the statement of operations. These losses were substantially offset by realized and unrealized gains on the offsetting positions.

The table below details outstanding foreign currency forward and option contracts at May 31, 2011 where the notional amount is determined using contract exchange rates:

(In thousands)
	Notional Value		Fair Value
Foreign currency forward contracts to sell U.S. dollars	$	8,700	$	37
Foreign currency forward contracts to purchase U.S. dollars		22,886		(82	)
Foreign currency option contracts to purchase U.S. dollars		22,775		2
Total	$	54,361	$	(43	)

The table below details outstanding foreign currency forward and option contracts at November 30, 2010 where the notional amount is determined using contract exchange rates:

(In thousands)
	Notional Value		Fair Value
Foreign currency forward contracts to sell U.S. dollars	$	36,856	$	317
Foreign currency forward contracts to purchase U.S. dollars		13,837		54
Foreign currency option contracts to purchase U.S. dollars		22,775		496
Total	$	73,468	$	867