Seagate 2015 Annual Report Download - page 95
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SEAGATETECHNOLOGYPLC
NOTESTOCONSOLIDATEDFINANCIALSTATEMENTS—(Continued)
unrealizedlossoncashflowhedgeswas$2millionasofJuly1,2016andtheamountofnetunrealizedgainoncashflowhedgeswas$1millionasofJuly3,2015.
TheCompanydedesignatesitscashflowhedgeswhentheforecastedhedgedtransactionsarerealizedoritisprobabletheforecastedhedgedtransactionswill
notoccurintheinitiallyidentifiedtimeperiod.Atsuchtime,theassociatedgainsandlossesdeferredinAccumulatedothercomprehensivelossarereclassified
immediatelyintoearningsandanysubsequentchangesinthefairvalueofsuchderivativeinstrumentsareimmediatelyreflectedinearnings.TheCompanydidnot
recognizeanymaterialnetgainsorlossesrelatedtothelossofhedgedesignationondiscontinuedcashflowhedgesduringfiscalyears2016,2015and2014.Asof
July1,2016,theCompany'sexistingforeigncurrencyforwardexchangecontractsmaturewithin12months.Thedeferredamountcurrentlyrecordedin
Accumulatedothercomprehensivelossexpectedtoberecognizedintoearningsoverthenext12monthsisimmaterial.
ThefollowingtablesshowthetotalnotionalvalueoftheCompany'soutstandingforeigncurrencyforwardexchangecontractsasofJuly1,2016andJuly3,
2015:
TheCompanyissubjecttoequitymarketrisksduetochangesinthefairvalueofthenotionalinvestmentsselectedbyitsemployeesaspartofitsNon-
qualifiedDeferredCompensationPlan—theSeagateDeferredCompensationPlan(the"SDCP").InthequarterendedDecember27,2013,theCompanyentered
intoaTotalReturnSwap("TRS")inordertomanagetheequitymarketrisksassociatedwiththeSDCPliabilities.TheCompanypaysafloatingrate,basedon
LIBORplusaninterestratespread,onthenotionalamountoftheTRS.TheTRSisdesignedtosubstantiallyoffsetchangesintheSDCPliabilityduetochangesin
thevalueoftheinvestmentoptionsmadebyemployees.AsofJuly1,2016,thenotionalinvestmentsunderlyingtheTRSamountedto$94million.Thecontract
termoftheTRSisthroughJanuary2016andissettledonamonthlybasis,thereforelimitingcounterpartyperformancerisk.TheCompanyrenewedthecontract
termthroughJanuary2017undermateriallythesameterms.TheCompanydidnotdesignatetheTRSasahedge.Rather,theCompanyrecordsallchangesinthe
fairvalueoftheTRStoearningstooffsetthemarketvaluechangesoftheSDCPliabilities.
92
AsofJuly1,2016
(Dollarsinmillions) ContractsDesignatedasHedges ContractsNotDesignatedasHedges
BritishPoundSterling $ 47 $ 10
AsofJuly3,2015
(Dollarsinmillions) ContractsDesignatedasHedges ContractsNotDesignatedasHedges
ThaiBaht $ 18 $ 48
SingaporeDollars 23 42
ChineseRenminbi 5 16
Euro — 13
BritishPoundSterling 35 —
MalaysianRinggit 12 15
$ 93 $ 134