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Financial Instruments | 12 Months Ended
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Jan. 31, 2020
Investments, All Other Investments [Abstract] |
Financial Instruments | Financial Instruments The following tables summarize the Company's financial instruments' amortized cost, gross unrealized gains, gross unrealized losses, and fair value by significant investment category as of January 31, 2020 and 2019.
|  |  | January 31, 2020
|  | (in millions) | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |  | Level 1 |  | Level 2 |  | Level 3
Cash equivalents (1): |  |  |  |  |  |  |  |  |  |  |  |  |
| Agency discount notes | $ | 6.0 |  |  | $ | — |  |  | $ | — |  |  | $ | 6.0 |  |  | $ | — |  |  | $ | 6.0 |  |  | $ | — |
| Commercial paper | 36.8 |  |  | — |  |  | — |  |  | 36.8 |  |  | — |  |  | 36.8 |  |  | — |
| Money market funds | 1,135.5 |  |  | — |  |  | — |  |  | 1,135.5 |  |  | 1,135.5 |  |  | — |  |  | — |
| Other (2) | 2.3 |  |  | — |  |  | — |  |  | 2.3 |  |  | 1.3 |  |  | 1.0 |  |  | — |
Marketable securities: |  |  |  |  |  |  |  |  |  |  |  |  |
| Short-term trading securities |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Mutual funds | 59.9 |  |  | 9.2 |  |  | (0.1 | ) |  | 69.0 |  |  | 69.0 |  |  | — |  |  | — |
Derivative contract assets (3) | 1.1 |  |  | 9.7 |  |  | (1.3 | ) |  | 9.5 |  |  | — |  |  | 8.9 |  |  | 0.6 |
Derivative contract liabilities (4) | — |  |  | — |  |  | (4.7 | ) |  | (4.7 | ) |  | — |  |  | (4.7 | ) |  | — |
|  | Total | $ | 1,241.6 |  |  | $ | 18.9 |  |  | $ | (6.1 | ) |  | $ | 1,254.4 |  |  | $ | 1,205.8 |  |  | $ | 48.0 |  |  | $ | 0.6 |
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(1) | Included in “Cash and cash equivalents” in the accompanying Consolidated Balance Sheets.
(2) | Consists of custody cash deposits and certificates of deposit.
(3) | Included in “Prepaid expenses and other current assets,” or “Other assets,” in the accompanying Consolidated Balance Sheets.
(4) | Included in “Other accrued liabilities” in the accompanying Consolidated Balance Sheets.
|  |  | January 31, 2019
|  | (in millions) | Amortized Cost |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Fair Value |  | Level 1 |  | Level 2 |  | Level 3
Cash equivalents (1): |  |  |  |  |  |  |  |  |  |  |  |  |
| Certificates of deposit | $ | 1.0 |  |  | $ | — |  |  | $ | — |  |  | $ | 1.0 |  |  | $ | — |  |  | $ | 1.0 |  |  | $ | — |
| Commercial paper | 87.9 |  |  | — |  |  | — |  |  | 87.9 |  |  | — |  |  | 87.9 |  |  | — |
| Corporate debt securities | 5.0 |  |  | — |  |  | — |  |  | 5.0 |  |  | — |  |  | 5.0 |  |  | — |
| Custody cash deposit | 0.8 |  |  | — |  |  | — |  |  | 0.8 |  |  | 0.8 |  |  | — |  |  | — |
| Money market funds | 281.4 |  |  | — |  |  | — |  |  | 281.4 |  |  | 281.4 |  |  | — |  |  | — |
Marketable securities: |  |  |  |  |  |  |  |  |  |  |  |  |
| Short-term available-for-sale |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Other (2) | 6.2 |  |  | 1.1 |  |  | — |  |  | 7.3 |  |  | 2.7 |  |  | 4.6 |  |  | — |
| Short-term trading securities |  |  |  |  |  |  |  |  |  |  |  |  |
|  | Mutual funds | 56.6 |  |  | 3.7 |  |  | — |  |  | 60.3 |  |  | 60.3 |  |  | — |  |  | — |
Convertible debt securities (3) | 4.6 |  |  | 1.9 |  |  | (2.1 | ) |  | 4.4 |  |  | — |  |  | — |  |  | 4.4 |
Derivative contract assets (4) | 1.7 |  |  | 8.6 |  |  | (1.8 | ) |  | 8.5 |  |  | — |  |  | 7.7 |  |  | 0.8 |
Derivative contract liabilities (5) | — |  |  | — |  |  | (7.4 | ) |  | (7.4 | ) |  | — |  |  | (7.4 | ) |  | — |
|  | Total | $ | 445.2 |  |  | $ | 15.3 |  |  | $ | (11.3 | ) |  | $ | 449.2 |  |  | $ | 345.2 |  |  | $ | 98.8 |  |  | $ | 5.2 |
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(1) | Included in “Cash and cash equivalents” in the accompanying Consolidated Balance Sheets.
(2) | Consists of corporate bonds, commercial paper, and common stock.
(3) | Considered "available for sale" securities and included in "Other assets" in the accompanying Consolidated Balance Sheets.
(4) | Included in “Prepaid expenses and other current assets”, "Other assets", or “Other accrued liabilities” in the accompanying Consolidated Balance Sheets.
(5) | Included in “Other accrued liabilities” in the accompanying Consolidated Balance Sheets.
Autodesk applies fair value accounting for certain financial assets and liabilities, which consist of cash equivalents, marketable securities and other financial instruments, on a recurring basis. The Company defines fair value as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. A reconciliation of the change in Autodesk’s Level 3 items for the fiscal year ended January 31, 2020 was as follows:
| Fair Value Measurements Using Significant Unobservable Inputs
| (Level 3)
(in millions) |  | Derivative Contracts |  | Convertible Debt Securities |  | Total
Balances, January 31, 2019 |  | $ | 0.8 |  |  | $ | 4.4 |  |  | $ | 5.2 |
Impairments |  | — |  |  | (1.0 | ) |  | (1.0 | )
Settlements |  | — |  |  | (3.5 | ) |  | (3.5 | )
(Losses) gains included in earnings (1) |  | (0.2 | ) |  | 0.2 |  |  | — |
Losses included in OCI |  | — |  |  | (0.1 | ) |  | (0.1 | )
Balances, January 31, 2020 |  | $ | 0.6 |  |  | $ | — |  |  | $ | 0.6 |
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(1) | Included in “Interest and other expense, net” in the accompanying Consolidated Statements of Operations.
As of January 31, 2020 and 2019, Autodesk had no material unrealized losses, individually and in the aggregate, for securities that are in a continuous unrealized loss position for greater than twelve months. There was no gain or loss for the sale or redemption of securities during fiscal 2020. The sales or redemptions of securities in fiscal 2019 and fiscal 2018 resulted in a loss of $1.3 million, and $0.3 million, respectively. The losses were recorded in "Interest and other expense, net" on the Company's Consolidated Statements of Operations. Proceeds from the sale and maturity of marketable securities for fiscal 2020, fiscal 2019 and fiscal 2018 were $27.4 million, $531.0 million and $1.08 billion, respectively. Non-marketable equity securities As of January 31, 2020 and 2019, Autodesk had $122.5 million and $111.6 million in direct investments in privately held companies. These non-marketable equity security investments do not have readily determined fair values and Autodesk uses the measurement alternative to account for the adjustment to these investments in a given quarter. During the fiscal years ended January 31, 2020 and 2019, Autodesk recorded an upward adjustment on certain of its privately held investments, reflected as a gain in "Interest and other expense, net" on the Company's Consolidated Statement of Operations of $3.2 million and $6.2 million, respectively. As of January 31, 2020, Autodesk has recorded $9.4 million in cumulative upward adjustments on certain of its privately held investments. If Autodesk determines that an impairment has occurred, Autodesk writes down the investment to its fair value. During fiscal 2020, fiscal 2019 and fiscal 2018, Autodesk recorded $4.2 million, $4.8 million and $15.5 million, respectively, in impairments and negative adjustments on its privately held investments, reflected as a loss in "Interest and other expense, net" on the Company's Consolidated Statements of Operations. As of January 31, 2020, Autodesk has recorded $9.0 million in cumulative impairments and negative adjustments on its privately held investments. Autodesk does not consider the remaining investments to be impaired at January 31, 2020. Foreign currency contracts designated as cash flow hedges Autodesk uses foreign currency contracts to reduce the exchange rate impact on a portion of the net revenue or operating expense of certain anticipated transactions. These currency collars and forward contracts are designated and documented as cash flow hedges. The notional amounts of these contracts are presented net settled and were $981.3 million at January 31, 2020, and $803.5 million at January 31, 2019. Outstanding contracts are recognized as either assets or liabilities on the balance sheet at fair value. The majority of the net gain of $8.4 million remaining in “Accumulated other comprehensive loss” as of January 31, 2020, is expected to be recognized into earnings within the next twenty-four months. The location and amount of gain or loss recognized in income on cash flow hedges together with the total amount of income or expense presented in the Company's Consolidated Statements of Operations where the effects of the hedge are recorded were as follows for the fiscal year ended January 31, 2020:
|  | Fiscal Year Ended January 31, 2020
|  | Net Revenue |  | Cost of revenue |  | Operating expenses
(in millions) |  | Subscription Revenue |  | Maintenance Revenue |  | Cost of subscription and maintenance revenue |  | Marketing and sales |  | Research and development |  | General and administrative
Total amounts of income and expense line items presented in the consolidated statements of operations in which the effects of cash flow hedges are recorded |  | $ | 2,751.9 |  |  | $ | 386.6 |  |  | $ | 223.9 |  |  | $ | 1,310.3 |  |  | $ | 851.1 |  |  | $ | 405.6 |
Gain (loss) on cash flow hedging relationships
Foreign exchange contracts |  |  |  |  |  |  |  |  |  |  |  |
Amount of gain (loss) reclassified from accumulated other comprehensive income into income |  | $ | 11.7 |  |  | $ | 5.9 |  |  | $ | (0.9 | ) |  | $ | (4.3 | ) |  | $ | (0.7 | ) |  | $ | (2.1 | )
Derivatives not designated as hedging instruments Autodesk uses foreign currency contracts that are not designated as hedging instruments to reduce the exchange rate risk associated primarily with foreign currency denominated receivables, payables, and cash. The notional amounts of these foreign currency contracts are presented net settled and were $736.2 million at January 31, 2020, and $579.8 million at January 31, 2019. Fair Value of Derivative Instruments: The fair value of derivative instruments in Autodesk’s Consolidated Balance Sheets were as follows as of January 31, 2020, and January 31, 2019:
| Balance Sheet Location |  | Fair Value at
(in millions) | January 31, 2020 |  | January 31, 2019
Derivative Assets |  |  |  |  |
Foreign currency contracts designated as cash flow hedges | Prepaid expenses and other current assets |  | $ | 1.0 |  |  | $ | 4.3 |
Derivatives not designated as hedging instruments | Prepaid expenses and other current assets and Other assets |  | 8.4 |  |  | 4.2 |
Total derivative assets |  |  | $ | 9.4 |  |  | $ | 8.5 |
Derivative Liabilities |  |  |  |  |
Foreign currency contracts designated as cash flow hedges | Other accrued liabilities |  | $ | 2.8 |  |  | $ | 3.3 |
Derivatives not designated as hedging instruments | Other accrued liabilities |  | 1.9 |  |  | 4.1 |
Total derivative liabilities |  |  | $ | 4.7 |  |  | $ | 7.4 |
The effects of derivatives designated as hedging instruments on Autodesk’s Consolidated Statements of Operations were as follows for the fiscal years ended January 31, 2020, 2019, and 2018, respectively (amounts presented include any income tax effects):
| Foreign Currency Contracts
| Fiscal Year Ended January 31,
(in millions) | 2020 |  | 2019 |  | 2018
Amount of gain (loss) recognized in accumulated other comprehensive loss on derivatives (effective portion) | $ | 3.0 |  |  | $ | 19.6 |  |  | $ | (21.3 | )
Amount and location of gain (loss) reclassified from accumulated other comprehensive loss into income (loss) (effective portion) |  |  |  |  |
Net revenue | $ | 17.6 |  |  | $ | (8.5 | ) |  | $ | 8.0 |
Cost of revenue | (0.9 | ) |  | — |  |  | — |
Operating expenses | (7.1 | ) |  | (3.6 | ) |  | 1.9 |
Total | $ | 9.6 |  |  | $ | (12.1 | ) |  | $ | 9.9 |
The effects of derivatives not designated as hedging instruments on Autodesk’s Consolidated Statements of Operations were as follows for the fiscal years ended January 31, 2020, 2019, and 2018, respectively (amounts presented include any income tax effects):
| Fiscal Year Ended January 31,
(in millions) | 2020 |  | 2019 |  | 2018
Amount and location of gain (loss) recognized on derivatives in net income (loss) |  |  |  |  |
Interest and other expense, net | $ | 6.0 |  |  | $ | 6.6 |  |  | $ | (19.1 | )

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- Definition The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures. + References No definition available. + Details
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