Polaris 2015 Annual Report Download - page 96

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The table below summarizes the carrying values of derivative instruments as of December 31, 2015 and 2014
(in thousands):
Carrying Values of Derivative Instruments
as of December 31, 2015
Derivative Net
Fair Value—Assets Fair Value—(Liabilities) Carrying Value
Derivatives designated as hedging instruments
Foreign exchange contracts(1) ............ $5,218 $(2,451) $2,767
Interest rate swap contracts(1) ............ 186 — 186
Total derivatives designated as hedging
instruments ........................ $5,404 $(2,451) $2,953
Commodity contracts(1) ................. — $ (354) $ (354)
Total derivatives not designated as hedging
instruments ........................ — $ (354) $ (354)
Total derivatives ...................... $5,404 $(2,805) $2,599
Carrying Values of Derivative Instruments
as of December 31, 2014
Derivative Net
Fair Value—Assets Fair Value—(Liabilities) Carrying Value
Derivatives designated as hedging instruments
Foreign exchange contracts(1) ............ $534 $(3,104) $(2,570)
Total derivatives designated as hedging
instruments ........................ $534 $(3,104) $(2,570)
Commodity contracts(1) ................. — $(4,609) $(4,609)
Total derivatives not designated as hedging
instruments ........................ — $(4,609) $(4,609)
Total derivatives ...................... $534 $(7,713) $(7,179)
(1) Assets are included in prepaid expenses and other and liabilities are included in other accrued expenses
on the accompanying consolidated balance sheets.
For derivative instruments that are designated and qualify as cash flow hedges, the effective portion of the
gain or loss on the derivative is reported as a component of accumulated other comprehensive loss and
reclassified into the income statement in the same period or periods during which the hedged transaction
affects the income statement. Gains and losses on the derivative representing either hedge ineffectiveness or
hedge components excluded from the assessment of effectiveness are recognized in the current income
statement.
The amount of gains (losses), net of tax, related to the effective portion of derivative instruments designated
as cash flow hedges included in accumulated other comprehensive loss for the years ended December 31, 2015
and 2014 was $3,320,000 and $(1,631,000), respectively.
See Note 7 for information about the amount of gains and losses, net of tax, reclassified from accumulated
other comprehensive income loss into the income statement for derivative instruments designated as hedging
instruments. The ineffective portion of foreign currency contracts was not material for the years ended
December 31, 2015 and 2014.
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