2.2.0.7 false DERIVATIVE FINANCIAL INSTRUMENTS 10301 - Disclosure - DERIVATIVE FINANCIAL INSTRUMENTS true false false false 1 USD false false Unit12 Standard http://www.xbrl.org/2003/iso4217 USD iso4217 0 Unit13 Divide http://www.xbrl.org/2003/iso4217 USD iso4217 http://www.xbrl.org/2003/instance shares xbrli 0 Unit1 Standard http://www.xbrl.org/2003/instance shares xbrli 0 $ 5 DERIVATIVE FINANCIAL INSTRUMENTS 3 us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock us-gaap true na duration No definition available. false false false false false false false false false false false false 1 false false false false 0 0 <div> NOTE 3 DERIVATIVE FINANCIAL INSTRUMENTS The Company is a party to certain offsetting and identical interest rate cap agreements. The cap agreements are not designated for hedge accounting treatment and were entered into to fulfill certain covenants of a sale agreement between a commercial paper conduit managed by JPMorgan Chase Bank, N.A. and PDC Funding. The cap agreements provide a credit enhancement feature for the financing contracts sold by PDC Funding to the commercial paper conduit, and replace a minimum interest rate margin previously required under the sale agreement. The cap agreements are cancelled and new agreements entered into periodically to maintain consistency with the dollar maximum of the sale agreements and the maturity of the underlying financing contracts. PDC Funding has purchased three interest rate caps from banks with combined notional amounts of $550 million and maturity dates of April 2016 ($425 million) and May 2016 ($125 million). Patterson Companies, Inc. sold three identical interest rate caps to the same banks. Similarly to the above agreements, PDC Funding II and Patterson Companies, Inc. entered into offsetting and identical interest rate swap agreements. These agreements have a notional amount of $110 million and a maturity date of July 2015. In addition to the identical purchased and sold interest rate contracts described above, the Company has entered into two interest rate swap agreements with banks to economically hedge the interest rate risk associated with our finance contracts. As of July 31, 2010, the agreements have notional amounts of approximately $16 million and $17 million, respectively, and maturity dates of November 2011 and February 2012, respectively. None of the Company's interest rate contracts qualify for hedge accounting treatment and, accordingly, the Company records the fair value of the agreements as an asset or liability and the change in any period as income or expense of the period in which the change occurs. In the first quarter of fiscal 2011, the Company entered into a foreign currency forward contract that was settled in the same quarter. This contract served as an economic hedge and was not designated as a hedge for accounting purposes. The total gain on the contract was $0.1 million.   The following table presents the fair value of the Company's interest rate contracts:   <table border="0" cellspacing="0" cellpadding="0" width="84%"> <tr><td width="53%"> </td> <td valign="bottom" width="4%"> </td> <td width="23%"> </td> <td valign="bottom" width="4%"> </td> <td> </td> <td> </td> <td valign="bottom" width="4%"> </td> <td> </td> <td> </td> <td valign="bottom" width="4%"> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom" nowrap="nowrap"> Derivative type</td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom"> Classification</td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">July 31, 2010</td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">April 24, 2010</td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">July 25, 2009</td></tr> <tr bgcolor="#cceeff"><td valign="top"> Assets:</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr><td valign="top"> Interest rate contracts</td> <td valign="bottom">  </td> <td valign="bottom">Other noncurrent assets</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">4.9</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">11.7</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">12.6</td></tr> <tr><td height="8"> </td> <td height="8" colspan="2"> </td> <td height="8" colspan="3"> </td> <td height="8" colspan="3"> </td> <td height="8" colspan="3"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Liabilities:</td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td valign="bottom">  </td> <td valign="bottom"> </td> <td valign="bottom"> </td></tr> <tr><td valign="top"> Interest rate contracts</td> <td valign="bottom">  </td> <td valign="bottom">Other noncurrent liabilities</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">5.5</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">12.6</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">14.2</td></tr></table> The following table presents the effect of interest rate and foreign currency contracts on the consolidated statements of income:   <table border="0" cellspacing="0" cellpadding="0" width="76%"> <tr><td width="35%"> </td> <td valign="bottom" width="11%"> </td> <td width="26%"> </td> <td valign="bottom" width="11%"> </td> <td> </td> <td> </td> <td> </td> <td valign="bottom" width="11%"> </td> <td> </td> <td> </td> <td> </td></tr> <tr><td valign="bottom" nowrap="nowrap"> Derivative type</td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom"> Location of gain(loss) recognized on derivative</td> <td valign="bottom">  </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">Three Months Ended July 31, 2010</td> <td valign="bottom"> </td> <td valign="bottom"> </td> <td style="border-bottom: #000000 1px solid;" valign="bottom" colspan="2" align="center">Three Months Ended July 25, 2009</td> <td valign="bottom"> </td></tr> <tr><td height="8"> </td> <td height="8" colspan="2"> </td> <td height="8" colspan="4"> </td> <td height="8" colspan="4"> </td></tr> <tr bgcolor="#cceeff"><td valign="top"> Interest rate contracts</td> <td valign="bottom">  </td> <td valign="bottom" nowrap="nowrap">Other income(expense), net</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">(0.0</td> <td valign="bottom" nowrap="nowrap">) </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">(0.4</td> <td valign="bottom" nowrap="nowrap">) </td></tr> <tr><td valign="top"> Foreign currency contracts</td> <td valign="bottom">  </td> <td valign="bottom">Other income(expense), net</td> <td valign="bottom">  </td> <td valign="bottom">$</td> <td valign="bottom" align="right">0.1</td> <td valign="bottom" nowrap="nowrap">  </td> <td valign="bottom"> </td> <td valign="bottom">$</td> <td valign="bottom" align="right">0.0</td> <td valign="bottom" nowrap="nowrap">  </td></tr></table>   </div> NOTE 3 DERIVATIVE FINANCIAL INSTRUMENTS The Company is a party to certain offsetting and identical interest rate cap agreements. The cap agreements are not false false false us-types:textBlockItemType textblock This element can be used to disclose the entity's entire derivative instruments and hedging activities disclosure as a single block of text. Describes an entity's risk management strategies, derivatives in hedging activities and non-hedging derivative instruments, the assets, obligations, liabilities, revenues and expenses arising there from, and the amounts of and methodologies and assumptions used in determining the amounts of such items. Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 133 -Paragraph 45 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 133 -Paragraph 44 false 1 1 false UnKnown UnKnown UnKnown false true