Derivative Instruments

3 Months Ended

Mar. 31, 2016

Derivative Instruments [Abstract]

Derivative Instruments

9. Derivative Instruments

The Company utilizes forward foreign currency exchange contracts to manage market risks associated with the fluctuations in foreign currency exchange rates.  It is the Company's policy to use such derivative financial instruments to protect against market risk arising in the normal course of business in order to reduce the impact of these exposures.  The Company minimizes credit exposure by limiting counterparties to nationally recognized financial institutions.

As of March 31, 2016, the Company had foreign exchange contracts outstanding of approximately 2.2 million Euro, 0.6 million Canadian Dollars, 0.3 million Pounds Sterling, and 0.3 million Australian Dollars at fixed rates.  The contracts expire on various dates through January 2017.  At December 31, 2015, the Company had contracts outstanding of approximately 2.1 million Euro, 1.3 million Canadian Dollars, 0.5 million Pounds Sterling, and 0.4 million Australian Dollars at fixed rates.

The Company has not designated any of the foreign exchange contracts outstanding as hedges and has recorded the estimated fair value of the contracts in the consolidated balance sheets as follows:

	March 31,			December 31,
(in thousands)	2016			2015
Asset derivatives
Prepaid expenses and other current assets	$	39		$	115
Other assets		-			6
		39			121
Liability derivatives
Other current liabilities		(159	)		(57	)
		(159	)		(57	)
Net fair value	$	(120	)	$	64

The changes in the fair value of the foreign exchange contracts are included in net loss on derivative instruments in the consolidated statements of operations.

The foreign currency denominated contract receivables, billings in excess of revenue earned and subcontractor accruals that are related to the outstanding foreign exchange contracts are remeasured at the end of each period into the functional currency using the current exchange rate at the end of the period.  The gain or loss resulting from such remeasurement is also included in net loss on derivative instruments in the consolidated statements of operations.

For the three months ended March 31, 2016 and March 31, 2015, the Company recognized a net loss on its derivative instruments as outlined below:

	Three months ended March 31,
(in thousands)	2016			2015
Foreign exchange contracts- change in fair value	$	(183	)	$	-
Remeasurement of related contract receivables,  billings in excess of revenue earned, and  subcontractor accruals		65			(48	)
Loss on derivative instruments, net	$	(118	)	$	(48	)