XML 28 R16.htm IDEA: XBRL DOCUMENT
v3.19.1

Derivative Financial Instruments | 6 Months Ended
--- | ---
Mar. 30, 2019
Derivative Instruments and Hedges, Assets [Abstract] |
Derivative Financial Instruments | Derivative Financial Instruments We principally use derivative financial instruments to manage interest rate risk associated with long-term debt and foreign exchange risk related to foreign operations and foreign currency transactions. We enter into derivative financial instruments with a number of major financial institutions to minimize counterparty credit risk. Derivatives designated as hedging instruments Interest rate swaps are used to adjust the proportion of total debt that is subject to variable and fixed interest rates. The interest rate swaps are designated as hedges of the amount of future cash flows related to interest payments on variable-rate debt that, in combination with the interest payments on the debt, convert a portion of the variable-rate debt to fixed-rate debt. At March 30, 2019, we had interest rate swaps with notional amounts totaling $105,000. The interest rate swaps effectively convert this amount of variable-rate debt to fixed-rate debt at 2.99%, including the applicable margin of 1.63% as of March 30, 2019. The interest will revert back to variable rates based on LIBOR plus the applicable margin upon the maturity of the interest rate swaps. These interest rate swaps mature at various times through June 23, 2020. We use foreign currency contracts as cash flow hedges to effectively fix the exchange rates on future payments and revenue. To mitigate exposure in movements between various currencies, including the Philippine peso, the British pound and the Czech koruna, we had outstanding foreign currency forwards with notional amounts of $69,048 at March 30, 2019. These contracts mature at various times through February 26, 2021. We use forward currency contracts to hedge our net investment in certain foreign subsidiaries. As of March 30, 2019, we had no outstanding net investment hedges. These interest rate swaps, foreign currency contracts and net investment hedges are recorded in the Consolidated Condensed Balance Sheets at fair value and the related gains or losses are deferred in Shareholders’ Equity as a component of Accumulated Other Comprehensive Income (Loss) (AOCIL). These deferred gains and losses are reclassified into the Consolidated Condensed Statements of Earnings, as necessary, during the periods in which the related payments or receipts affect earnings. However, to the extent the interest rate swaps and foreign currency contracts are not perfectly effective in offsetting the change in the value of the payments and revenue being hedged, the ineffective portion of these contracts is recognized in earnings immediately. Ineffectiveness was not material in the first six months of 2019 or 2018. Derivatives not designated as hedging instruments We also have foreign currency exposure on balances, primarily intercompany, that are denominated in foreign currencies and are adjusted to current values using period-end exchange rates. The resulting gains or losses are recorded in the Consolidated Condensed Statements of Earnings. To minimize foreign currency exposure, we had foreign currency contracts with notional amounts of $78,359 at March 30, 2019. The foreign currency contracts are recorded in the Consolidated Condensed Balance Sheets at fair value and resulting gains or losses are recorded in the Consolidated Condensed Statements of Earnings. We recorded the following gains or losses on foreign currency contracts which are included in other income or expense and generally offset the gains or losses from the foreign currency adjustments on the intercompany balances that are also included in other income or expense:
|  | Three Months Ended |  | Six Months Ended
| March 30, 2019 |  | March 31, 2018 |  | March 30, 2019 |  | March 31, 2018
Net gain (loss) |  | $ | 2,419 |  |  | $ | (2,381 | ) |  | $ | 769 |  |  | $ | (3,009 | )
Summary of derivatives The fair value and classification of derivatives is summarized as follows:
|  |  | March 30, 2019 |  | September 29, 2018
Derivatives designated as hedging instruments: |  |  |  |  |
Foreign currency contracts | Other current assets |  | $ | 690 |  |  | $ | 659 |
Foreign currency contracts | Other assets |  | 178 |  |  | 41 |
Interest rate swaps | Other current assets |  | 673 |  |  | 1,444 |
Interest rate swaps | Other assets |  | 24 |  |  | 322 |
| Total asset derivatives |  | $ | 1,565 |  |  | $ | 2,466 |
Foreign currency contracts | Other accrued liabilities |  | $ | 703 |  |  | $ | 1,842 |
Foreign currency contracts | Other long-term liabilities |  | 63 |  |  | 464 |
| Total liability derivatives |  | $ | 766 |  |  | $ | 2,306 |
Derivatives not designated as hedging instruments: |  |  |  |
Foreign currency contracts | Other current assets |  | $ | 376 |  |  | $ | 285 |
Foreign currency contracts | Other accrued liabilities |  | $ | 477 |  |  | $ | 87 |

X
- References No definition available. + Details
Name: | us-gaap_DerivativeInstrumentsAndHedgesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- 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
Name: | us-gaap_DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration