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Derivative financial instruments | 9 Months Ended
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Jul. 31, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract] |
Derivative financial instruments | Derivative financial instruments Foreign Currency Forward Contracts 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 Condensed Consolidated Statements of Income together with the transaction gain or loss from the related balance sheet position. For the three months ended July 31, 2023, we recognized a net loss of $93 on foreign currency forward contracts and a net loss of $885 from the change in fair value of balance sheet positions. For the three months ended July 31, 2022, we recognized a net gain of $15,181 on foreign currency forward contracts and a net loss of $14,436 from the change in fair value of balance sheet positions. For the nine months ended July 31, 2023, we recognized a net gain of $12,086 on foreign currency forward contracts and a net loss of $19,710 from the change in fair value of balance sheet positions. For the nine months ended July 31, 2022, we recognized a net gain of $2,503 on foreign currency forward contracts and a net loss of $394 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 Receivable-net and Accrued liabilities, respectively, in our Consolidated Balance Sheets. The following table summarizes, by currency, the foreign currency forward contracts outstanding at July 31, 2023 and 2022:
July 31, 2023 contract amounts: |  | Notional Sell Amounts |  | Notional Buy Amounts
Euro |  | $ | 95,064 |  |  | $ | 194,850 |
British pound |  | 20,489 |  |  | 132,956 |
Japanese yen |  | 23,195 |  |  | 17,908 |
Mexican Peso |  | 3,227 |  |  | 28,158 |
Hong Kong dollar |  | 2,080 |  |  | 7,265 |
Singapore dollar |  | 60 |  |  | 19,817 |
Australian dollar |  | — |  |  | 9,236 |
Taiwan Dollar |  | — |  |  | 8,000 |
Others |  | 2,602 |  |  | 71,830 |
Total |  | $ | 146,717 |  |  | $ | 490,020 |
July 31, 2022 contract amounts: |  | Notional Sell Amounts |  | Notional Buy Amounts
Euro |  | $ | 88,275 |  |  | $ | 333,285 |
British pound |  | 36,779 |  |  | 78,942 |
Japanese yen |  | 16,688 |  |  | 37,163 |
Hong Kong dollar |  | — |  |  | 67,341 |
Singapore dollar |  | 378 |  |  | 18,025 |
Australian dollar |  | 278 |  |  | 9,426 |
Others |  | 26,012 |  |  | 98,113 |
Total |  | $ | 168,410 |  |  | $ | 642,295 |
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. For the three and nine months ended July 31, 2023 and 2022, there were no significant concentrations of credit risk. Net Investment Hedges Net assets of our foreign subsidiaries are exposed to volatility in foreign currency exchange rates. We may utilize net investment hedges to offset the translation adjustment arising from re-measuring our investment in foreign subsidiaries. During the second quarter of 2023, the Company designated €180,000 of borrowings as a hedge of our net investment in certain foreign subsidiaries to mitigate the foreign exchange risk associated with certain investments in these subsidiaries. On June 30, 2023, the hedge was terminated. Any increase or decrease related to the remeasurement of the €180,000 borrowing into U.S. dollars was recorded in the currency translation component of Accumulated other comprehensive income (loss) within Shareholders' Equity in the Consolidated Balance Sheet. A gain of $1,144, net of tax, and a loss of $2,467, net of tax, was recorded on these net investment hedges for the three and nine months ended July 31, 2023, respectively. During the quarter ended July 31, 2023, the Company entered into various cross currency swaps between the U.S. Dollar and Euro, Japanese Yen, Taiwan Dollar and Chinese Yuan which were designated as a hedges of our net investments in certain foreign subsidiaries to mitigate the foreign exchange risk associated with certain investments in these subsidiaries. Any increases or decreases related to the remeasurement of the hedges are recorded in the currency translation component of Accumulated other comprehensive income (loss) within Shareholders' Equity in the Consolidated Balance Sheet until the sale or substantial liquidation of the underlying investments. A loss of $1,205, net of tax, was recorded for both the three and nine months ended July 31, 2023. The following table summarizes the fair values of our net investment contracts designated as net investment hedges in the Company's Consolidated Balance Sheets as of July 31, 2023:
|  | Prepaid expenses and other current assets |  | Other assets |  | Accrued liabilities |  | Other long-term liabilities
Net investment contracts |  | $ | 2,977 |  |  | $ | 59 |  |  | $ | 841 |  |  | $ | 3,760 |

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- Definition The entire disclosure for financial instruments. This disclosure includes, but is not limited to, fair value measurements of short and long term marketable securities, international currencies forward contracts, and auction rate securities. Financial instruments may include hedging and non-hedging currency exchange instruments, derivatives, securitizations and securities available for sale at fair value. Also included are investment results, realized and unrealized gains and losses as well as impairments and risk management disclosures. + References No definition available. + Details
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