Derivative Financial Instruments and Hedging Activities (Tables)

6 Months Ended

Feb. 28, 2013

Changes Related to Cash Flow Hedges Included in Accumulated Other Comprehensive Income (Loss) Net of Tax

The changes related to cash flow hedges (both forward foreign exchange contracts and interest rate swaps) included in AOCI net of tax are as follows (in thousands):

	Six months ended February 28, 2013
Accumulated comprehensive loss, August 31, 2012	$	(7,153	)
Change in fair value of derivative instruments		509
Reclassification of net losses realized and included in net income related to derivative instruments		381
Accumulated comprehensive loss, February 28, 2013	$	(6,263	)

	Six months ended February 29, 2012
Accumulated comprehensive loss, August 31, 2011	$	(11,172	)
Change in fair value of derivative instruments		3,113
Reclassification of net losses realized and included in net income related to derivative instruments		1,289
Accumulated comprehensive loss, February 29, 2012	$	(6,770	)

Interest rate swap

Impact of Derivatives for Foreign Currency Risk (Interest Rate Risk) and Designated as Hedging Instruments on Accumulated Other Comprehensive Income (Loss) and Earnings

The following tables present the impact that changes in the fair value of the derivative utilized for interest rate risk management and designated as a hedging instrument had on AOCI and earnings during the six months ended February 28, 2013 and February 29, 2012 (in thousands):

Derivatives in Cash Flow Hedging Relationship during the Six Months Ended February 28, 2013	Amount of Gain (Loss)  Recognized in OCI on Derivative (Effective Portion)		Location of Gain  (Loss) Reclassified from Accumulated  OCI into Income (Effective Portion)		Amount of Gain or  (Loss) Reclassified from Accumulated  OCI into Income (Effective Portion)			Location of Gain  or (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)		Amount of Gain  or (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Interest rate swap	$	—		Interest expense	$	(1,953	)		Interest expense	$	—

Derivatives in Cash Flow Hedging Relationship during the Six Months Ended February 29, 2012	Amount of Gain (Loss)  Recognized in OCI on Derivative (Effective Portion)		Location of Gain  (Loss) Reclassified from Accumulated  OCI into Income (Effective Portion)		Amount of Gain or  (Loss) Reclassified from Accumulated  OCI into Income (Effective Portion)			Location of Gain  or (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)		Amount of Gain  or (Loss) Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Interest rate swap	$	—		Interest expense	$	(1,964	)		Interest expense	$	—

Forward foreign exchange contracts

Fair Value of Assets and Liabilities Related to Foreign Forward Exchange Contracts Measured on Recurring Basis

The following table presents the Company’s assets and liabilities related to forward foreign exchange contracts measured at fair value on a recurring basis as of February 28, 2013, aggregated by the level in the fair-value hierarchy in which those measurements are classified (in thousands):

	Level 1		Level 2			Level 3		Total
Assets:
Forward foreign exchange contracts	$	—	$	7,333		$	—	$	7,333
Liabilities:
Forward foreign exchange contracts		—		(5,722	)		—		(5,722	)
Total	$	—	$	1,611		$	—	$	1,611

Fair Value of Derivative Instruments Located on Condensed Consolidated Balance Sheets

The following tables present the fair values of the Company’s derivative instruments located on the Condensed Consolidated Balance Sheets utilized for foreign currency risk management purposes at February 28, 2013 and August 31, 2012 (in thousands):

	Fair Values of Derivative Instruments At February 28, 2013
	Asset Derivatives			Liability Derivatives
	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Derivatives designated as hedging instruments:
Forward foreign exchange contracts	Prepaid expenses and other current assets	$	2,521	Other accrued expense	$	1,922
Derivatives not designated as hedging instruments:
Forward foreign exchange contracts	Prepaid expenses and other current assets	$	4,812	Other accrued expense	$	3,800

	Fair Values of Derivative Instruments At August 31, 2012
	Asset Derivatives			Liability Derivatives
	Balance Sheet Location	Fair Value		Balance Sheet Location	Fair Value
Derivatives designated as hedging instruments:
Forward foreign exchange contracts	Prepaid expenses and other current assets	$	1,335	Other accrued expense	$	1,190
Derivatives not designated as hedging instruments:
Forward foreign exchange contracts	Prepaid expenses and other current assets	$	4,445	Other accrued expense	$	2,976

Impact of Derivatives for Foreign Currency Risk (Interest Rate Risk) and Designated as Hedging Instruments on Accumulated Other Comprehensive Income (Loss) and Earnings

The following tables present the impact that changes in fair value of derivatives utilized for foreign currency risk management purposes and designated as hedging instruments had on AOCI and earnings during the six months ended February 28, 2013 and February 29, 2012 (in thousands):

Derivatives in Cash Flow Hedging Relationship during the Six Months Ended February 28, 2013	Amount of Gain (Loss)  Recognized in OCI on Derivative (Effective Portion)			Location of Gain  (Loss) Reclassified from AOCI into  Income (Effective Portion)	Amount of  Gain (Loss) Reclassified  from AOCI into Income (Effective Portion)			Location of Gain (Loss)  Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)	Amount of Gain (Loss)  Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Forward foreign exchange contracts	$	(1,795	)	Revenue	$	(2,394	)	Revenue	$	132
Forward foreign exchange contracts	$	2,287		Cost of revenue	$	3,663		Cost of revenue	$	4,140
Forward foreign exchange contracts	$	17		Selling, general and administrative	$	303		Selling, general and administrative	$	139

Derivatives in Cash Flow Hedging Relationship during the Six Months Ended February 29, 2012	Amount of Gain (Loss)  Recognized in OCI on Derivative (Effective Portion)			Location of Gain  (Loss) Reclassified from AOCI into  Income (Effective Portion)	Amount of  Gain (Loss) Reclassified  from AOCI into Income (Effective Portion)			Location of Gain (Loss)  Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)	Amount of Gain (Loss)  Recognized in Income on Derivative (Ineffective Portion and Amount Excluded from Effectiveness Testing)
Forward foreign exchange contracts	$	2,179		Revenue	$	1,701		Revenue	$	(34	)
Forward foreign exchange contracts	$	2,618		Cost of revenue	$	1,530		Cost of revenue	$	(1,704	)
Forward foreign exchange contracts	$	(1,684	)	Selling, general and administrative	$	(2,556	)	Selling, general and administrative	$	83

Impact of Derivatives for Foreign Currency Risk and Not Designated as Hedging Instruments on Earnings

The following tables present the impact that changes in fair value of derivatives utilized for foreign currency risk management purposes and not designated as hedging instruments had on earnings during the six months ended February 28, 2013 and February 29, 2012 (in thousands):

Derivatives not designated as hedging instruments	Location of Gain (Loss) Recognized in Income on Derivative	Amount of Gain (Loss) Recognized in Income on Derivative during the Six Months Ended February 28, 2013
Forward foreign exchange contracts	Cost of revenue	$	(11,020	)

Derivatives not designated as hedging instruments	Location of Gain (Loss) Recognized in Income on Derivative	Amount of Gain (Loss) Recognized in Income on Derivative during the Six Months Ended February 29, 2012
Forward foreign exchange contracts	Cost of revenue	$	2,815