Note 14: Financial Instruments

Foreign Currencies

As a multinational business, the Company's transactions are denominated in a variety of currencies. When appropriate, the Company uses forward foreign currency contracts to reduce its overall exposure to the effects of currency fluctuations on its results of operations and cash flows. The Company's policy prohibits trading in currencies for which there are no underlying exposures, or entering into trades for any currency to intentionally increase the underlying exposure.

The Company primarily hedges existing assets and liabilities associated with transactions currently on its balance sheet, which are undesignated hedges for accounting purposes.

At December 31, 2016 and 2015, the Company had net outstanding foreign exchange contracts with net notional amounts of $95.9 million and $89.8 million, respectively. Such contracts were obtained through financial institutions and were scheduled to mature within one to three months from the time of purchase. Management believes that these financial instruments should not subject the Company to increased risks from foreign exchange movements because gains and losses on these contracts should offset losses and gains on the underlying assets, liabilities and transactions to which they are related.

The following schedule summarizes the Company's net foreign exchange positions in U.S. dollars as of December 31, 2016 and 2015 (in millions):



	December 31,
	2016 Buy (Sell)			2016 Notional Amount		2015 Buy (Sell)			2015 Notional Amount
Euro	$	(25.4	)	$	25.4	$	(17.5	)	$	17.5
Japanese Yen	(33.7		)	33.7		(30.0		)	30.0
Malaysian Ringgit	—			—		7.1			7.1
Philippine Peso	15.8			15.8		13.7			13.7
Other currencies - Buy	(6.1		)	6.1		17.1			17.1
Other currencies - Sell	14.9			14.9		(4.4		)	4.4
	$	(34.5	)	$	95.9	$	(14.0	)	$	89.8

The Company is exposed to credit-related losses if counterparties to its foreign exchange contracts fail to perform their obligations. As of December 31, 2016, the counterparties to the Company's foreign exchange contracts, as well as the cash flow hedges described below, are held at financial institutions which the Company believes to be highly rated and no credit-related losses are anticipated. Amounts receivable or payable under the contracts are included in other current assets or accrued expenses in the accompanying Consolidated Balance Sheet. For the years ended December 31, 2016, 2015 and 2014, realized and unrealized foreign currency transactions totaled a $0.7 million gain, a $1.5 million loss and a $3.1 million gain, respectively, and are included in other income and expenses in the Company's consolidated statements of operations and comprehensive income.

Cash Flow Hedges

The Company is exposed to global market risks associated with fluctuations in interest rates and foreign currency exchange rates. The Company addresses these risks through controlled management that includes the use of derivative financial instruments to economically hedge or reduce these exposures. The Company does not enter into derivative financial instruments for trading or speculative purposes.

All derivatives are recognized on the balance sheet at their fair value and classified based on the instrument’s maturity date. The Company did not have outstanding derivatives designated as cash flow hedges as of December 31, 2016.

For the year ended December 31, 2016, the Company recorded a loss of $0.2 million associated with cash flow hedges recognized as a component of cost of revenues. See Note 13: "Fair Value Measurements" for information with respect to the balances of cash flow hedges.

Other

At December 31, 2016, the Company had no outstanding commodity derivatives, currency swaps or options relating to either its debt instruments or investments. The Company does not hedge the value of its equity investments in its subsidiaries or affiliated companies.