Harley Davidson 2015 Annual Report Download - page 75

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75
contracts were settled in July 2015. The loss at settlement was recorded in accumulated other comprehensive loss and will be
reclassified into earnings over the life of the debt.
The Company utilized interest rate swaps to reduce the impact of fluctuations in interest rates on its unsecured
commercial paper by converting a portion from a floating rate basis to a fixed rate basis. The interest rate swaps expired during
the second quarter of 2013, and as of December 31, 2013, there were no interest rate swaps outstanding.
The following tables summarize the fair value of the Company’s derivative financial instruments at December 31 (in
thousands):
2015 2014
Derivatives Designated As Hedging
Instruments Under ASC Topic 815 Notional
Value Asset
Fair Value(a) Liability
Fair Value(b) Notional
Value Asset
Fair Value(a) Liability
Fair Value(b)
Foreign currency contracts(c) $ 436,352 $ 16,167 $ 181 $ 339,077 $ 32,244 $ —
Commodities contracts(c) 968 — 159 1,728 — 414
Total $ 437,320 $ 16,167 $ 340 $ 340,805 $ 32,244 $ 414
2015 2014
Derivatives Not Designated As Hedging
Instruments Under ASC Topic 815 Notional
Value Asset
Fair Value(a) Liability
Fair Value(b) Notional
Value Asset
Fair Value(a) Liability
Fair Value(b)
Commodities contracts $ 6,510 $ 68 $ 960 $ 11,804 $ — $ 1,613
Total $ 6,510 $ 68 $ 960 $ 11,804 $ — $ 1,613
(a) Included in other current assets
(b) Included in accrued liabilities
(c) Derivative designated as a cash flow hedge
The following tables summarize the amount of gains and losses for the following years ended December 31 related to
derivative financial instruments designated as cash flow hedges (in thousands):
Amount of Gain/(Loss)
Recognized in OCI, before tax
Cash Flow Hedges 2015 2014 2013
Foreign currency contracts $ 45,810 $ 47,037 $ 3,468
Commodities contracts (421)(262) 39
Treasury rate locks (7,381) — —
Interest rate swaps – unsecured commercial paper — — (2)
Total $ 38,008 $ 46,775 $ 3,505
Amount of Gain/(Loss)
Reclassified from AOCL into Income
Cash Flow Hedges 2015 2014 2013 Expected to be Reclassified
Over the Next Twelve Months
Foreign currency contracts(a) $ 59,730 $ 13,635 $ 482 $ 16,738
Commodities contracts(a) (677) 228 (51)(159)
Treasury rate locks(b) (151) — — (362)
Interest rate swaps – unsecured commercial paper(c) — — (345) —
Total $ 58,902 $ 13,863 $ 86 $ 16,217
(a) Gain/(loss) reclassified from accumulated other comprehensive loss (AOCL) to income is included in cost of goods sold.
(b) Gain/(loss) reclassified from AOCL to income is included in interest expense
(c) Gain/(loss) reclassified from AOCL to income is included in financial services interest expense.
For the years ended December 31, 2015 and 2014, the cash flow hedges were highly effective and, as a result, the amount
of hedge ineffectiveness was not material. No amounts were excluded from effectiveness testing.