XML 39 R25.htm IDEA: XBRL DOCUMENT v3.10.0.1
Financial Instruments
 12 Months Ended
Dec. 31, 2018
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Financial Instruments —Financial Instruments
 
Foreign Currency Forward Contracts

The Company uses foreign currency forward contracts to hedge a portion of its foreign currency exchange rate exposure to forecasted foreign currency denominated cash flows. These instruments are not held for speculative or trading purposes.

A summary of the Company's designated and non-designated cash flow hedges follows:
 
 
December 31, 2018
 
December 31, 2017
(in millions)
 
Fair Value (1)
 
Notional Value
 
Fair Value (1)
 
Notional Value
Designated hedges
 
$
0.2

 
$
95.0

 
$
(0.2
)
 
$
22.3

Non-designated hedges
 
0.1

 
49.9

 
0.2

 
38.6

(1) 
The fair value of foreign currency forward contracts is included in other current assets. The fair value was estimated using observable market inputs such as forward and spot prices of the underlying exchange rate pair. Based on these inputs, derivative assets and liabilities are classified as Level 2 in the fair value hierarchy.

For instruments that are designated and qualify as a cash flow hedge, the Company had foreign currency forward contracts with maturities less than one year. The changes in the fair value of the contracts are recorded in accumulated other comprehensive income (loss) and recognized in the same line item as the impact of the hedged item, revenues or cost of sales, when the underlying forecasted transaction impacts earnings. Gains and losses on the contracts representing hedge components excluded from the assessment of hedge effectiveness are recognized in the same line item as the hedged item, revenues or cost of sales, currently.
 
For instruments that are not designed as a cash flow hedge, the Company had foreign exchange contracts with maturities less than one year. The unrealized gains and losses resulting from these contracts were immaterial and are recognized in other non-operating (income) expense, net and partially offset corresponding foreign exchange gains and losses on these balances.

Accumulated Other Comprehensive Income (Loss)

The changes in accumulated other comprehensive income (loss) by component follows:
(in millions)
 
Accrued
post-retirement benefit liability
 
Foreign currency translation
 
Foreign currency forward contracts
 
Total
Balance as of January 1, 2017
 
$
(26.4
)
 
$
(96.7
)
 
$
0.9

 
$
(122.2
)
Other comprehensive income (loss) before reclassifications
 
(11.2
)
 
46.6

 
(4.4
)
 
31.0

Amounts reclassified from accumulated other comprehensive income (loss) (1)
 
2.5

 
—

 
(0.5
)
 
2.0

Income tax benefit
 
3.5

 
—

 
—

 
3.5

Other comprehensive income (loss)
 
(5.2
)
 
46.6

 
(4.9
)
 
36.5

Balance as of December 31, 2017
 
(31.6
)
 
(50.1
)
 
(4.0
)
 
(85.7
)
Adoption of accounting standard
 
(6.5
)
 
—

 
—

 
(6.5
)
Other comprehensive income (loss):
 
 
 
 
 
 
 
 
Other comprehensive income (loss) before reclassifications
 
(5.1
)
 
(30.3
)
 
0.4

 
(35.0
)
Amounts reclassified from accumulated other comprehensive income (loss) (1)
 
4.6

 
—

 
0.4

 
5.0

Income tax benefit
 
0.1

 
—

 
—

 
0.1

Other comprehensive income (loss)
 
(0.4
)
 
(30.3
)
 
0.8

 
(29.9
)
Balance as of December 31, 2018
 
$
(38.5
)
 
$
(80.4
)
 
$
(3.2
)
 
$
(122.1
)
(1) 
The accrued post‑retirement benefit liability reclassification pertains to the amortization of unrecognized actuarial gains and losses and prior service credits which is included in net periodic benefit cost. See Note 15 for additional pension discussion.
Deferred Compensation Rabbi Trust

The Company’s Deferred Compensation Plan allows certain eligible participants to defer a portion of their cash compensation and provides a matching contribution to the deferred compensation plan of up to 4.0% of eligible compensation. Eligible compensation may be deferred up to 10 years and distributed via lump sum or annual payment installments over an additional 10-year period. Participants allocate their deferred compensation amongst various investment options with earnings accruing to the participant.
 
The Company has established a Rabbi Trust to provide for a degree of financial security to cover its obligations with its deferred compensation plan. Contributions to the Rabbi Trust by the Company are made at the discretion of management and generally are made in cash and invested in money-market funds. The Company consolidates the Rabbi Trust and therefore includes the investments in its Consolidated Balance Sheets. As of December 31, 2018, and 2017, the Company had $10.7 million and $13.2 million of cash, respectively, and $4.3 million and $4.0 million of short-term investments, respectively. The short-term investments are measured at fair value using quoted market prices in active markets (i.e. Level 1 measurements) with changes in fair value recorded in net income and the associated cash flows presented as operating cash flows.

Other Financial Instruments

Other financial instruments include cash and cash equivalents, accounts receivable, net, accounts payable, accrued expenses and long-term debt. The carrying value for cash and cash equivalents, accounts receivable, net, accounts payable and accrued expenses approximates fair value because of their short-term nature and generally negligible credit losses (refer to Note 14 for the fair value of long-term debt).