Cardinal Health 2009 Annual Report Download - page 121

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The following table summarizes the gain/(loss) recognized in OCI for derivative instruments designated as
cash flow hedges for the fiscal years ended June 30, 2009, 2008 and 2007 (in millions):
Fiscal Year Ended June 30,
Cash Flow Hedging Instruments 2009 2008 2007
Pay-fixed interest rate swaps ................................................. $(3.7) $ 6.7 $ 0.9
Foreign currency forward contracts ............................................ (6.9) (5.2) (3.5)
Commodity contracts ....................................................... 1.2 — —
The following table summarizes the gain/(loss) reclassified from accumulated OCI into earnings for
derivative instruments designated as cash flow hedges for the fiscal years ended June 30, 2009, 2008 and 2007
(in millions):
Fiscal Year Ended June 30,
Cash Flow Hedging Instruments Statement of Earnings Location 2009 2008 2007
Pay-fixed interest rate swaps .............Interest expense and other $ (7.6) $ (3.0) $(0.3)
Foreign currency forward contracts .......Revenue (1.1) (1.1) (1.1)
Foreign currency forward contracts .......Cost of products sold 13.9 (17.0) (2.6)
Foreign currency forward contracts .......Selling, general and administrative expenses (7.2) 3.7 0.9
Commodity contracts ..................Selling, general and administrative expenses (0.6) — —
The amount of ineffectiveness associated with these derivative instruments was not material.
Economic (Non-designated) Hedges
The Company enters into foreign currency forward contracts to manage its foreign exchange exposure
related to intercompany financing transactions and other balance sheet items subject to revaluation that do not
meet the requirements for hedge accounting treatment. Accordingly, these derivative instruments are adjusted to
current market value at the end of each period. The gain or loss recorded on these instruments is substantially
offset by the remeasurement adjustment on the foreign currency denominated asset or liability. The settlement of
the derivative instrument and the remeasurement adjustment on the foreign currency denominated asset or
liability are both recorded in interest expense and other at the end of each period.
The following table summarizes the economic derivative instruments outstanding as of June 30, 2009 and
2008 (in millions):
June 30, 2009 June 30, 2008
Type
Notional
Amount Maturity Date
Notional
Amount Maturity Date
Foreign currency forward
contracts ................. $845.3 July 2009 – December 2013 $859.1 July 2008 – December 2013
The following table summarizes the gain/(loss) recognized in earnings for economic derivative instruments
for the fiscal years ended June 30, 2009, 2008 and 2007 (in millions):
Fiscal Year Ended June 30,
Non-Designated Derivative Instruments Statement of Earnings Location 2009 2008 2007
Foreign currency forward contracts ................. Interest expense and other $(14.1) $(36.8) $(26.5)
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