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DERIVATIVES | 12 Months Ended
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Dec. 31, 2020
DERIVATIVES |
DERIVATIVES | NOTE 15 – DERIVATIVES The Company uses derivative instruments to manage exposures to currency exchange rates, interest rates and commodity prices arising in the normal course of business. Both at inception and on an ongoing basis, the derivative instruments that qualify for hedge accounting are assessed as to their effectiveness, when applicable. Hedge ineffectiveness was immaterial for each of the three years in the period ended December 31, 2020. The Company is subject to the credit risk of the counterparties to derivative instruments. Counterparties include a number of major banks and financial institutions. None of the concentrations of risk with any individual counterparty was considered significant at December 31, 2020. The Company does not expect any counterparties to fail to meet their obligations. Cash flow hedges Certain foreign currency forward contracts are qualified and designated as cash flow hedges. The dollar equivalent gross notional amount of these short-term contracts was $69,051 at December 31, 2020 and $59,982 at December 31, 2019. During March and April 2020, in anticipation of future debt issuance associated with the Notes referenced in Note 12, the Company entered into interest rate forward starting swap agreements to hedge the variability of future changes in interest rates. The forward starting swap agreements were qualified and designated as a cash flow hedge. The changes in fair value are recorded as part of AOCI, and upon completion of debt issuance and termination of the swaps, are amortized to interest expense over the life of the underlying debt. The dollar equivalent gross notional amount of the long-term contracts was $100,000 at December 31, 2020 and have a termination date of August 2025. Fair value hedges Certain interest rate swap agreements are qualified and designated as fair value hedges. At December 31, 2019, the Company had interest rate swap agreements outstanding that effectively convert notional amounts of $50,000 of debt from a fixed interest rate to a variable interest rate based on three-month LIBOR plus a spread of between 0.5% and 0.6%. The variable rates reset every three months, at which time payment or receipt of interest will be settled. The Company terminated the interest rate swaps in the year ended December 31, 2020, which resulted in a gain of $6,629 that is amortized to interest expense over the remaining life of the underlying debt. Net investment hedges The Company has cross currency swaps that are qualified and designated as net investment hedges. The dollar equivalent gross notional amount of these contracts is $50,000 as of December 31, 2020. Derivatives not designated as hedging instruments The Company has certain foreign exchange forward contracts which are not designated as hedges. These derivatives are held as hedges of certain balance sheet exposures. The dollar equivalent gross notional amount of these contracts was $391,112 at December 31, 2020 and $363,820 at December 31, 2019. Fair values of derivative instruments in the Company’s Consolidated Balance Sheets follow: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | December 31, 2020 | ​ | December 31, 2019
​ | Other | ​ | Other | ​ | ​ | ​ | ​ | ​ | ​ | ​ | Other | ​ | Other | ​ | ​ | ​ | ​ | ​ | ​
​ | Current | ​ | Current | ​ | Other | ​ | Other | ​ | Current | ​ | Current | ​ | Other | ​ | Other
Derivatives by hedge designation | Assets |  | Liabilities |  | Assets |  | Liabilities |  | Assets |  | Liabilities |  | Assets |  | Liabilities
Designated as hedging instruments: | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |  |  | ​ |
Foreign exchange contracts | $ | 2,451 | ​ | $ | 1,124 | ​ | $ | — | ​ | $ | — | ​ | $ | 1,288 | ​ | $ | 522 | ​ | $ | — | ​ | $ | —
Interest rate swap agreements |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | 2,964 | ​ |  | —
Forward starting swap agreements | ​ | — | ​ | ​ | — | ​ | ​ | 4,876 | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | — | ​ | ​ | —
Cross currency swap agreements |  | — | ​ |  | — | ​ |  | — | ​ |  | 4,308 | ​ |  | — | ​ |  | — | ​ |  | — | ​ |  | 653
Not designated as hedging instruments: |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  | ​ | ​ |  |
Foreign exchange contracts |  | 1,398 | ​ |  | 3,485 | ​ |  | — | ​ |  | — | ​ |  | 2,397 | ​ |  | 973 | ​ |  | — | ​ |  | —
Total derivatives | $ | 3,849 | ​ | $ | 4,609 | ​ | $ | 4,876 | ​ | $ | 4,308 | ​ | $ | 3,685 | ​ | $ | 1,495 | ​ | $ | 2,964 | ​ | $ | 653
​ The effects of undesignated derivative instruments on the Company’s Consolidated Statements of Income consisted of the following: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | Year Ended December 31,
Derivatives by hedge designation |  | Classification of gain (loss) |  | 2020 |  | 2019
Foreign exchange contracts | ​ | Selling, general & administrative expenses | ​ | $ | 3,160 | ​ | $ | 13,154
​ The effects of designated cash flow hedges on AOCI and the Company’s Consolidated Statements of Income consisted of the following: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Total gain (loss) recognized in AOCI, net of tax |  | December 31, 2020 |  | December 31, 2019 |
Foreign exchange contracts | ​ | $ | 660 | ​ | $ | 620 | ​
Forward starting swap agreements | ​ | ​ | 3,649 | ​ | ​ | — | ​
Net investment contracts | ​ |  | (1,822) | ​ |  | 1,006 | ​
​ The Company expects a gain of $660 related to existing contracts to be reclassified from AOCI, net of tax, to earnings over the next 12 months as the hedged transactions are realized. ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ |  | ​ |  | Year Ended December 31,
​ | ​ | Gain (loss) recognized in the | ​ | ​ | ​ | ​ | ​ | ​
Derivative type |  | Consolidated Statements of Income: |  | 2020 |  | 2019
Foreign exchange contracts |  | Sales | ​ | $ | (2,015) | ​ | $ | 975
​ |  | Cost of goods sold | ​ |  | (158) | ​ |  | 454
​

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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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