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Derivative Instruments and Hedging Activities | 3 Months Ended
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Mar. 31, 2018
Derivative Instruments And Hedging Activities Disclosure [Abstract] |
Derivative Instruments and Hedging Activities | 8. DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES We participate in foreign exchange forward contracts in connection with the management of exposure to fluctuations in foreign exchange rates. Cash Flow Hedges Our cash flow hedging activities utilize foreign exchange forward contracts to reduce the risk that movements in exchange rates will adversely affect the net cash flows resulting from the planned purchase of products from foreign suppliers. Purchases of U.S. denominated inventory by our European subsidiary represent our primary exposure. Changes in the fair value of derivatives designated as cash flow hedges are not recognized in current operating results, but are recorded in accumulated other comprehensive income. Amounts related to cash flow hedges are reclassified from accumulated other comprehensive income when the underlying hedged item impacts earnings. This reclassification is recorded in the same line item of the consolidated statements of income at which the effects of the hedged item are recorded, which is cost of sales. Undesignated Hedges We have certain customers and suppliers who are invoiced or pay in a non-functional currency. Changes in the monetary exchange rates may adversely affect our results of operations and financial condition, as outstanding non-functional balances are revalued to the functional currency through profit and loss. When appropriate, we utilize foreign exchange forward contracts to help manage the volatility relating to these valuation exposures. All changes in the fair value of our derivative instruments that do not qualify for or are not designated for hedged accounting transactions are recognized as other income (expense) in the Consolidated Statements of Income. We do not hold or issue derivative instruments for trading or other speculative purposes. Our derivative instruments are recorded in the Consolidated Balance Sheets at their fair values. Our derivative instruments are not subject to master netting arrangements and are not offset in the Consolidated Balance Sheets. As of March 31, 2018, we had no foreign exchange forward contracts. The change in the fair values of our derivative instruments recorded in the Consolidated Statements of Income during the three months ended March 31, 2018 and 2017 were as follows:
|  |  |  | Three Months Ended |
|  | Income Statement |  | March 31, |
(In thousands) |  | Location |  | 2018 |  |  | 2017 |
Derivatives Not Designated as Hedging Instruments: |  |  |  |  |  |  |  |  |  |
Foreign exchange contracts |  | Other income (expense) |  | $ | 13 |  |  | $ | (34 | )
The change in our derivatives designated as hedging instruments recorded in other comprehensive income (OCI) and reclassified to income, net of tax, during the three months ended March 31, 2018 and 2017 were as follows:
|  | Amount of Gains (Losses) Recognized in |  |  |  |  | Amount of Gains (Losses) Reclassified |
|  | OCI on Derivatives |  |  |  |  | from AOCI into Income |
|  | Three Months Ended |  |  | Location of Gains |  | Three Months Ended |
|  | March 31, |  |  | (Losses) Reclassified |  | March 31, |
(In thousands) |  | 2018 |  |  | 2017 |  |  | from AOCI into Income |  | 2018 |  |  | 2017 |
Derivatives Designated as Hedging Instruments: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Foreign exchange contracts |  | $ | — |  |  | $ | 79 |  |  | Cost of Sales |  | $ | — |  |  | $ | — |

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- References No definition available. + Details
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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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