Derivative Financial Instruments

12 Months Ended

Sep. 30, 2013

Derivative Financial Instruments

3. Derivative Financial Instruments

At September30, 2013, the Company’s Canadian subsidiary had $28.3 million of Canadian dollar denominated intercompany accounts payable owed to the Company’s U.S. subsidiaries. In order to mitigate its exposure to movements in foreign currency rates between the U.S. dollar and Canadian dollar, the Company routinely enters into foreign currency forward contracts to hedge a portion of its exposure to changes in the value of the Canadian dollar. At September30, 2013, the Company was a party to a $20.0 million foreign currency forward contract. This contract reduces the impact on cash flows from movements in the Canadian dollar/U.S. dollar currency exchange rate. At September30, 2013, the Company had accrued unrealized foreign exchange losses of $0.4 million under this contract.

The following table summarizes the gross fair value of all derivative instruments, which are not designated as hedging instruments and their location in the consolidated balance sheets (in thousands):

Derivative Instrument	Location	September30, 2013		September30, 2012
ForeignCurrencyForwardContracts	AccruedExpenses	$	351	$	215
		$	351	$	215

The Company did not have derivatives prior to the fiscal year ended September 30, 2012. The following table summarizes the impact of the Company’s derivatives on the consolidated statements of operations for the fiscal years ended September30, 2013 and 2012 (in thousands):

		For the Years Ended
Derivative Instrument	Location of Gain (loss) on Derivative Instrument	September30, 2013		September30, 2012
Foreign Currency Forward Contracts	OtherIncome(Expense)		398			(394	)
		$	398		$	(394	)

Amounts in the above table include realized and unrealized derivative gains and losses.