Avid 2011 Annual Report Download - page 69

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64
other than the functional currency of the legal entity. These forward contracts typically mature within 30 days of execution.
At December 31, 2011 and 2010, the Company had foreign currency forward contracts outstanding with notional values of $69.1
million and $47.4 million, respectively, as hedges against forecasted foreign-currency-denominated receivables, payables and
cash balances. The following table sets forth the balance sheet locations and fair values of the Company's foreign currency
forward contracts at December 31, 2011 and 2010 (in thousands):
Derivatives Not Designated as Hedging
Instruments under ASC Topic 815
Financial assets:
Foreign currency forward contracts
Financial liabilities:
Foreign currency forward contracts
Balance Sheet Location
Other current assets
Accrued expenses and other current liabilities
Fair
Value at
December 31,
2011
—
$1,430
Fair
Value at
December 31,
2010
$389
$1
The following table sets forth the net foreign exchange gains and losses recorded as marketing and selling expenses in the
Company's statements of operations during the years ended December 31, 2011, 2010 and 2009 that resulted from the Company's
foreign exchange contracts not designated as hedging instruments and the revaluation of the related hedged items (in thousands):
Derivatives Not Designated as Hedging
Instruments under ASC Topic 815
Foreign currency forward contracts
Net Gain (Loss) Recorded in Marketing and Selling Expenses
2011
$464
2010
$(880)
2009
$1,416
See Note E for additional information on the fair value measurements for all financial assets and liabilities, including derivative
assets and derivative liabilities, that are measured at fair value on a recurring basis.
E. FAIR VALUE MEASUREMENTS
Assets and Liabilities Measured at Fair Value on a Recurring Basis
On a recurring basis, the Company measures certain financial assets and liabilities at fair value, including cash equivalents,
marketable securities and foreign-currency forward contracts. At December 31, 2011 and 2010, all of the Company's financial
assets and liabilities were classified as either Level 1 or Level 2 in the fair value hierarchy as defined by ASC Topic 820, Fair
Value Measurements and Disclosure. Assets and liabilities valued using quoted market prices in active markets and classified as
Level 1 are certain deferred compensation investments and related obligations. Assets and liabilities valued based on other
observable inputs and classified as Level 2 are foreign currency forward contracts and certain deferred compensation obligations.
The following tables summarize the Company's fair value hierarchy for its financial assets and liabilities measured at fair value on
a recurring basis at December 31, 2011 and 2010 (in thousands):
Financial Assets:
Deferred compensation assets
Financial Liabilities:
Deferred compensation obligations
Foreign currency forward contracts
December 31,
2011
$ 1,549
$ 3,920
1,430
Fair Value Measurements at Reporting Date Using
Quoted Prices in
Active Markets
for Identical
Assets (Level 1)
$ 1,018
$ 1,018
—
Significant
Other
Observable
Inputs (Level 2)
$ 531
$ 2,902
1,430
Significant
Unobservable
Inputs
(Level 3)
$ —
$ —
—