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DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 12 Months Ended
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Dec. 31, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 11. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES Risk Management Objective of Using Derivatives The Company is exposed to certain interest rate risks on our outstanding debt and foreign currency risks arising from our international business operations and global economic conditions. The Company enters into certain derivative financial instruments to lock in certain interest rates, as well as to protect the value or fix the amount of certain obligations in terms of its functional currency, the U.S. dollar. Cash Flow Hedges of Interest Rate Risk The Company uses interest rate swap arrangements to manage or hedge its interest rate risk. Notwithstanding the terms of the swaps, the Company is ultimately obligated for all amounts due and payable under the Revolving Commitment and the Term Loan (“Credit Facility”). The Company does not use such instruments for speculative or trading purposes. On June 19, 2019, the Company entered into a floating-to-fixed interest rate swap for an aggregate notional amount of $100.0 million in order to hedge a portion of the Company’s floating rate indebtedness under the Credit Facility. The Company designated the swap as a cash flow hedge. The swap requires the Company to pay a fixed rate of 1.94% per annum on the notional amount. The notional amounts as of December 31, 2020 and 2019 were $40.0 and $80.0 million, respectively. The cash flows from the swap began June 30, 2019 and end on December 31, 2021. As of December 31, 2020 and 2019, $0.4 million and $0.3 million, respectively, had been recorded as Accumulated Losses in Other Comprehensive Income (“AOCI”). Realized gains and losses in connection with each required interest payment are reclassified from AOCI to interest expense during the period of the cash flows. During 2020, $0.7 million was recorded as additional interest expense from the swap. During 2019, $0.1 million was recorded as interest income, partially offsetting the floating rate interest expense on our Credit Facility. On a quarterly basis, management evaluates any swap agreement to determine its effectiveness or ineffectiveness and records the change in fair value as an adjustment to AOCI. Management intends that the swap remains effective. No swaps existed at December 31, 2018. Hedges of Foreign Exchange Risk The Company is exposed to fluctuations in various foreign currencies against its functional currency, the US dollar. We use foreign currency derivatives, specifically foreign currency forward contracts (“FX Forwards”), to manage our exposure to fluctuations in the USD-CAD and AUD-USD exchange rates. FX Forwards involve fixing the foreign currency exchange rate for delivery of a specified amount of foreign currency on a specified date. The FX Forwards are typically settled in US dollars for their fair value at or close to their settlement date. We do not currently designate any of these FX Forwards under hedge accounting, but rather reflect the changes in fair value immediately in earnings. We do not use such instruments for speculative or trading purposes, but rather use them to manage our exposure to foreign exchange rates. Changes in the fair value of FX Forwards are recorded in other income/expense and were equal to a net gain of $0.2 million for the twelve months ended December 31, 2020 and a net loss of $0.4 million in 2019. The fair values of the Company’s FX Forwards were recorded in Other Current Liabilities as net obligations of $0.4 million and $0.2 million at December 31, 2020 and 2019, respectively. As of December 31, 2020, the Company had the following outstanding FX Forwards (in thousands except for number of instruments):
(in thousands except for number of instruments) |  | Number of Instruments |  |  | Sell Notional |  |  | Buy Notional |
FX Forward Contracts |  |  |  |  |  |  |  |  |  |  |  |
Sell AUD/Buy USD Fwd Contract |  | $ | 12 |  |  | $ | 1,600 |  |  | $ | 1,233 |
Sell CAD/Buy USD Fwd Contract |  |  | 14 |  |  |  | 14,500 |  |  |  | 11,381 |
Total |  | $ | 26 |  |  |  |  |  |  | $ | 12,614 |
The financial statement impact related to these derivative instruments was insignificant for the years ended December 31, 2020, 2019, and 2018.

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- Definition The entire disclosure for derivative instruments and hedging activities including, but not limited to, risk management strategies, non-hedging derivative instruments, assets, liabilities, revenue and expenses, and methodologies and assumptions used in determining the amounts. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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