Derivative Financial Instruments

12 Months Ended

Oct. 31, 2021

Investments, All Other Investments [Abstract]

Derivative financial instruments

We 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 2021, we recognized net gains of $1,485 on foreign currency forward contracts and net losses of $7,411 from the change in fair value of balance sheet positions. 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. The fair values of our foreign currency forward contract assets and liabilities are included in Receivables-net and Accrued liabilities, respectively in the Consolidated Balance Sheets.

The following table summarizes, by currency, the contracts outstanding at October 31, 2021 and 2020:


	Notional Amounts
	Sell		Buy
October 31, 2021 contract amounts:
Euro	$	100,922	$	325,581
Pound sterling	50,333		79,934
Japanese yen	14,338		45,436
Australian dollar	709		10,088
Hong Kong dollar	6,948		44,831
Singapore dollar	200		18,029
Others	16,367		86,492
Total	$	189,817	$	610,391
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

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, 2021 and 2020, there were no significant concentrations of credit risk.