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Financial Instruments and Risk Management | 9 Months Ended
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Sep. 30, 2017
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Financial Instruments and Risk Management | Financial Instruments and Risk Management The Company uses forward foreign exchange contracts to manage its exposures to movements in foreign exchange rates. As of September 30, 2017, the notional U.S. dollar equivalent of commitments to sell foreign currencies within the Company’s derivative portfolio was $588,866, primarily consisting of contracts hedging exposures to the Australian dollar, Euro, Canadian dollar, Mexican peso, and the New Zealand dollar. Fair Values of Derivative Instruments The fair values of derivative financial instruments recognized in the Condensed Consolidated Balance Sheets of the Company were as follows:
| Balance Sheet Location |  | Fair Value
| September 30, 2017 |  | December 31, 2016
Hedges | Other current assets |  | $ | 907 |  |  | $ | 16,729 |
Non-hedges | Other current assets |  | 541 |  |  | 4,363 |
Total derivative assets |  |  | 1,448 |  |  | 21,092 |
Hedges | Accrued liabilities |  | (21,169 | ) |  | (207 | )
Non-hedges | Accrued liabilities |  | (4,503 | ) |  | (172 | )
Total derivative liabilities |  |  | (25,672 | ) |  | (379 | )
Net derivative (liability) asset |  |  | $ | (24,224 | ) |  | $ | 20,713 |
Cash Flow Hedges The Company uses forward foreign exchange contracts to reduce the effect of fluctuating foreign currencies on short-term foreign currency-denominated transactions, foreign currency-denominated investments and other known foreign currency exposures. Gains and losses on these contracts are intended to offset losses and gains on the hedged transaction in an effort to reduce the earnings volatility resulting from fluctuating foreign currency exchange rates. The Company expects to reclassify into earnings during the next 12 months a net loss from AOCI of approximately $16,432. The changes in fair value of derivatives excluded from the Company’s effectiveness assessments and the ineffective portion of the changes in the fair value of derivatives used as cash flow hedges are reported in the “Selling, general and administrative expenses” line in the Condensed Consolidated Statements of Income. The effect of cash flow hedge derivative instruments on the Condensed Consolidated Statements of Income and AOCI is as follows:
| Amount of Loss Recognized in AOCI (Effective Portion) |  | Amount of Loss Recognized in AOCI (Effective Portion)
| Quarter Ended |  | Nine Months Ended
| September 30, 2017 |  | October 1, 2016 |  | September 30, 2017 |  | October 1, 2016
Foreign exchange contracts | $ | (17,379 | ) |  | $ | (3,594 | ) |  | $ | (43,660 | ) |  | $ | (7,131 | )
| Location of Gain Reclassified from AOCI into Income (Effective Portion) |  | Amount of Gain Reclassified from AOCI into Income (Effective Portion) |  | Amount of Gain Reclassified from AOCI into Income (Effective Portion)
|  | Quarter Ended |  | Nine Months Ended
|  | September 30, 2017 |  | October 1, 2016 |  | September 30, 2017 |  | October 1, 2016
Foreign exchange contracts | Cost of sales |  | $ | 414 |  |  | $ | 715 |  |  | $ | 3,348 |  |  | $ | 4,424 |
Derivative Contracts Not Designated As Hedges The Company uses foreign exchange derivative contracts as economic hedges against the impact of foreign exchange fluctuations on existing accounts receivable and payable balances and intercompany lending transactions denominated in foreign currencies. These contracts are not designated as hedges under the accounting standards and are recorded at fair value in the Condensed Consolidated Balance Sheet. Any gains or losses resulting from changes in fair value are recognized directly into earnings. Gains or losses on these contracts largely offset the net remeasurement gains or losses on the related assets and liabilities. The effect of derivative contracts not designated as hedges on the Condensed Consolidated Statements of Income is as follows:
| Location of Gain (Loss) Recognized in Income on Derivative |  | Amount of Gain Recognized in Income |  | Amount of Gain (Loss) Recognized in Income
| Quarter Ended |  | Nine Months Ended
| September 30, 2017 |  | October 1, 2016 |  | September 30, 2017 |  | October 1, 2016
Foreign exchange contracts | Selling, general and administrative expenses |  | $ | 3,277 |  |  | $ | 7,694 |  |  | $ | (1,398 | ) |  | $ | 7,970 |

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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://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 815 -URI http://asc.fasb.org/topic&trid=2229140 + Details
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- References No definition available. + Details
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