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Derivative Instruments
 3 Months Ended 6 Months Ended
Sep. 30, 2012
Sep. 30, 2012
Derivative Instruments And Hedging Activities Disclosure [Abstract]    
Derivative Instruments And Hedging Activities Disclosure [Text Block]
September 30,Derivatives Designated as Cash Flow Hedges  Gain/(Loss) Recognized (1) Location of Gain/(Loss) Recognized in Income on Derivatives Gain/(Loss) Reclassified (2)
2012Foreign exchange contracts$(68) Cost of products sold$24
2011Foreign exchange contracts$ - Cost of products sold$(5)
        
(1) Recognized in Other Comprehensive Loss (AOCL) on Derivatives (Effective Portion)
(2) Reclassified from AOCL into Income (Effective Portion)

September 30,Derivatives Not Designated as Hedging Instruments  Location of Gain Recognized in Income on Derivatives Gain Recognized in Income on Derivatives
2012Foreign exchange contracts Foreign currency exchange gain (loss)$(77)
2011Foreign exchange contracts Foreign currency exchange gain $837

7.        Derivative Instruments

 

The Company uses derivative instruments to manage selected foreign currency exposures. The Company does not use derivative instruments for speculative trading purposes. All derivative instruments must be recorded on the balance sheet at fair value. For derivatives designated as cash flow hedges, the effective portion of changes in the fair value of the derivative is recorded as accumulated other comprehensive loss, or “AOCL”, and is reclassified to earnings when the underlying transaction has an impact on earnings. The ineffective portion of changes in the fair value of the derivative is reported in foreign currency exchange gain in the Company's consolidated statement of operations. For derivatives not classified as cash flow hedges, all changes in market value are recorded as a foreign currency exchange loss (gain) in the Company's consolidated statements of operations.

 

The Company has foreign currency forward agreements and cross-currency swaps in place to offset changes in the value of intercompany loans to certain foreign subsidiaries due to changes in foreign exchange rates. The notional amount of these derivatives is $5,795,000 and all contracts mature by September 30, 2013. These contracts are not designated as hedges.

 

The Company has foreign currency forward agreements in place to hedge changes in the value of recorded foreign currency liabilities due to changes in foreign exchange rates at the settlement date. The notional amount of those derivatives is $2,380,000 and all contracts mature within twelve months. These contracts are marked to market each balance sheet date and are not designated as hedges.

 

The Company has foreign currency forward agreements that are designated as cash flow hedges to hedge a portion of forecasted inventory purchases and sales, including multi-year contracts related to capital project sales, denominated in a foreign currency. The notional amount of those derivatives is $9,533,000 and all contracts mature within twenty one months of September 30, 2012.

 

The Company is exposed to credit losses in the event of non performance by the counterparties on its financial instruments. All counterparties have investment grade credit ratings. The Company anticipates that these counterparties will be able to fully satisfy their obligations under the contracts. The Company has derivative contracts with three different counterparties as of September 30, 2012.

 

The following is the effect of derivative instruments on the condensed consolidated statement of operations for the three months ended September 30, 2012 and 2011 (in thousands):

September 30,Derivatives Designated as Cash Flow Hedges  (Loss)/Gain Recognized (3) Location of Gain/(Loss) Recognized in Income on Derivatives Gain Reclassified (4)
2012Foreign exchange contracts$(73) Cost of products sold$116
2011Foreign exchange contracts$135 Cost of products sold$63
        
(3) Recognized in AOCL on Derivatives (Effective Portion)
(4) Reclassified from AOCL into Income (Effective Portion)

September 30,Derivatives Not Designated as Hedging Instruments  Location of Gain Recognized in Income on Derivatives Gain Recognized in Income on Derivatives
2012Foreign exchange contracts Foreign currency exchange gain $534
2011Foreign exchange contracts Foreign currency exchange gain $988

As of September 30, 2012, the Company had no derivatives designated as net investments or fair value hedges in accordance with ASC Topic 815, “Derivatives and Hedging.”

 

The following is information relative to the Company's derivative instruments in the condensed consolidated balance sheet as of September 30, 2012 (in thousands):

     
Derivatives Designated as Hedging Instruments  Balance Sheet Location Fair Value of Asset (Liability)
Foreign exchange contracts Other Assets$ 69
Foreign exchange contracts Accrued Liabilities$ (247)
     
Derivatives Not Designated as Hedging Instruments  Balance Sheet Location Fair Value of Asset (Liability)
Foreign exchange contracts Other Assets$ 59
Foreign exchange contracts Accrued Liabilities$ (12)