Memorex 2014 Annual Report Download - page 85

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80
Gains and losses related to cash flow hedges are deferred in accumulated other comprehensive loss with a
corresponding asset or liability. When the hedged transaction occurs, the gains and losses in accumulated other
comprehensive loss are reclassified into our Consolidated Statements of Operations in the same line as the item
being hedged. If at any time it is determined that a derivative is not highly effective as a hedge, we discontinue
hedge accounting prospectively, with deferred gains and losses being recognized in current period operations. The
following table sets forth our cash flow hedges which are measured at fair value on a recurring basis.
December 31, 2014 December 31, 2013
Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Unobservabl
e
Inputs
(Level 3)
Quoted
Prices in
Active
Markets for
Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Unobservabl
e
Inputs
(Level 3)
(In millions)
Derivative assets
Foreign currency option
contracts $ — $ — $ — $ — $ 1.8 $ —
Foreign currency forward
contracts — 7.3 — — 3.3 —
Derivative liabilities
Foreign currency option
contracts — — — — (0.2) —
Foreign currency forward
contracts — — — — (0.5) —
Total $ — $ 7.3 $ — $ — $ 4.4 $ —
Other Derivative Instruments. We use foreign currency forward contracts to manage the foreign currency
exposure related to our monetary assets and liabilities denominated in foreign currencies. We record the estimated
fair value of these forward contracts within other current assets or other current liabilities on our Consolidated
Balance Sheets and because we do not receive hedge accounting for these derivatives, changes in their value are
recognized every reporting period in our Consolidated Statements of Operations.
For 2014, 2013 and 2012 we recorded foreign currency losses of $2.2 million, gains of $0.5 million, and losses
of $1.6 million, respectively, in Other expenses, net in our Consolidated Statements of Operations. These results
reflect changes in foreign exchange rates on foreign denominated assets and liabilities and are net of losses of $0.8
million and gains of $1.7 million and $0.7 million, from the related foreign currency forward contracts for 2014, 2013
and 2012, respectively.
The notional amounts and fair values of our derivative instruments recorded in other current assets and other
current liabilities in our Consolidated Financial Statements were as follows:
December 31, 2014 December 31, 2013
Fair Value Fair Value
Notional
Amount
Other
Current
Assets
Other
Current
Liabilities Notional
Amount
Other
Current
Assets
Other
Current
Liabilities
(In millions)
Cash flow hedges designated as
hedging instruments $ 86.7 $ 7.3 $ — $ 133.8 $ 5.1 $ (0.7)
Other hedges not receiving hedge
accounting 23.4 — — 29.4 — —
Total $ 110.1 $ 7.3 $ — $ 163.2 $ 5.1 $ (0.7)
On December 31, 2014 we entered into certain hedges not receiving hedge accounting treatment and the
estimated fair value of these hedges were inconsequential as of December 31, 2014.