Derivative Financial Instruments

12 Months Ended

Oct. 31, 2020

Investments, All Other Investments [Abstract]

Derivative financial instrumentsWe operate internationally and enter into intercompany transactions denominated in foreign currencies. Consequently, we are subject to market risk arising from exchange rate movements between the dates foreign currency transactions occur and the dates they are settled. We regularly use foreign currency forward contracts to reduce our risks related to most of these transactions. These contracts usually have maturities of 90 days or less and generally require us to exchange foreign currencies for U.S. dollars at maturity, at rates stated in the contracts. These contracts are not designated as hedging instruments under U.S. GAAP. Accordingly, the changes in the fair value of the foreign currency forward contracts are recognized in each accounting period in “Other – net” on the Consolidated Statement of Income together with the transaction gain or loss from the related balance sheet position. In 2020, we recognized net losses of $5,899 on foreign currency forward contracts and net gains of $4,367 from the change in fair value of balance sheet positions. In 2019, we recognized net gains of $2,373 on foreign currency forward contracts and net losses of $2,231 from the change in fair value of balance sheet positions. In 2018, we

recognized net losses of $3,151 on foreign currency forward contracts and net gains of $4,284 from the change in fair value of balance sheet positions. The fair values of our foreign currency forward contract assets and liabilities are included in Prepaid expenses and other current assets and Accrued liabilities, respectively in the Consolidated Balance Sheets.

The following table summarizes, by currency, the contracts outstanding at October 31, 2020 and 2019:


	Notional Amounts
	Sell		Buy
October 31, 2020 contract amounts:
Euro	$	127,849	$	259,510
Pound sterling	36,943		71,380
Japanese yen	23,262		41,133
Australian dollar	179		9,084
Hong Kong dollar	59,459		81,199
Singapore dollar	1,102		17,350
Others	6,985		73,310
Total	$	255,779	$	552,966
October 31, 2019 contract amounts:
Euro	$	264,661	$	107,598
Pound sterling	32,600		48,867
Japanese yen	29,397		51,217
Australian dollar	168		7,767
Hong Kong dollar	189		135,862
Singapore dollar	1,108		15,684
Others	4,485		66,349
Total	$	332,608	$	433,344

We are exposed to credit-related losses in the event of nonperformance by counterparties to financial instruments. These financial instruments include cash deposits and foreign currency forward contracts. We periodically monitor the credit ratings of these counterparties in order to minimize our exposure. Our customers represent a wide variety of industries and geographic regions. As of October 31, 2020 and 2019, there were no significant concentrations of credit risk.