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DERIVATIVES
 12 Months Ended
Dec. 31, 2011
DERIVATIVES [Abstract]  
DERIVATIVES

(9)       DERIVATIVES

Cash Flow Hedges

The Company enters into foreign exchange and interest rate derivatives. Foreign exchange derivatives entered into consist of forward and option contracts to reduce the Company's exposure to foreign currency exchange rate fluctuations that are associated with forecasted revenue earned in foreign locations. Interest rate derivatives consist of interest rate swaps to reduce the Company's exposure to interest rate fluctuations associated with its variable rate debt. Upon proper qualification, these contracts are designated as cash flow hedges. It is the Company's policy to only enter into derivative contracts with investment grade counterparty financial institutions, and correspondingly, the fair value of derivative assets consider, among other factors, the creditworthiness of these counterparties. Conversely, the fair value of derivative liabilities reflects the Company's creditworthiness. As of December 31, 2011, the Company has not experienced, nor does it anticipate any issues related to derivative counterparty defaults. The following table summarizes the aggregate unrealized net gain or loss in Accumulated other comprehensive income (loss) for the years ended December 31, 2011, 2010 and 2009 (amounts in thousands and net of tax):

  Year Ended December 31,
  2011 2010 2009
          
Aggregate unrealized net gain/(loss) at beginning of year $ 7,090 $ 4,467 $ (21,180)
Add: Net gain/(loss) from change in fair value of cash flow hedges   (7,362)   8,513   14,427
Less: Net (gain)/loss reclassified to earnings from effective hedges   (5,580)   (5,890)   11,220
Aggregate unrealized net gain/(loss) at end of year $ (5,852) $ 7,090 $ 4,467
          

The Company's foreign exchange cash flow hedging instruments as of December 31, 2011 and 2010 are summarized as follows (amounts in thousands). All hedging instruments are forward contracts unless noted otherwise.

As of December 31, 2011 Local Currency Notional Amount U.S. Dollar Notional Amount  % Maturing in 2012 Contracts Maturing Through
Canadian Dollar  25,750 $ 25,137  69.9% March 2014
Costa Rican Colon  2,000,000   3,874  100.0% August 2012
Philippine Peso  13,304,000   301,361 (1) 56.3% December 2014
Mexican Peso (Forwards)  1,081,000   80,735   47.7% November 2014
Mexican Peso (Collars)  140,298   12,000 (3) 100.0% December 2012
British Pound Sterling  8,808   13,822 (2) 60.1% June 2014
    $ 436,929     
           

As of December 31, 2010 Local Currency Notional Amount U.S. Dollar Notional Amount     
Canadian Dollar  10,200 $ 8,493     
Philippine Peso  7,731,000   169,364 (1)    
Mexican Peso  311,500   22,383     
British Pound Sterling  4,647   7,231 (2)    
    $ 207,471     
           

(1)       Includes contracts to purchase Philippine pesos in exchange for New Zealand dollars and Australian dollars, which are translated into equivalent U.S. dollars on December 31, 2011 and December 31, 2010.

(2)       Includes contracts to purchase British pound sterling in exchange for Euros, which are translated into equivalent U.S. dollars on December 31, 2011 and December 31, 2010.

(3)       The Mexican peso collars include call options with a floor total of MXN 140,298 and put options with a cap total of MXN 157,038.

The Company's interest rate swap arrangements as of December 31, 2011 were as follows:

  Notional Amount Variable Rate Received Fixed Rate Paid Contract Commencement Date Contract Maturity Date
As of December 31, 2011 $25 million 1 - month LIBOR   2.55% April 2012 April 2016
   15 million 1 - month LIBOR   3.14% May 2012 May 2017
  $40 million          
              

The Company did not have any interest rate swap arrangements as of December 31, 2010.

Hedge of Net Investment

In 2008, the Company entered into a foreign exchange forward contract to hedge its net investment in a foreign operation which was settled in May 2009. Changes in fair value of the Company's net investment hedge are recorded in the cumulative translation adjustment in Accumulated other comprehensive income (loss) in the accompanying Consolidated Balance Sheets offsetting the change in the cumulative translation adjustment attributable to the hedged portion of the Company's net investment in the foreign operation. Gains and losses from the settlements of the Company's net investment hedge remain in Accumulated other comprehensive income (loss) until partial or complete liquidation of the applicable net investment. A loss of $1.2 million from the settlements of net investment hedges was recorded within Accumulated other comprehensive income (loss) at December 31, 2011.

Fair Value Hedges

The Company enters into foreign exchange forward contracts to hedge against foreign currency exchange gains and losses on certain receivables and payables of the Company's foreign operations. Changes in the fair value of derivative instruments designated as fair value hedges, as well as the offsetting gain or loss on the hedged asset or liability, are recognized in earnings in Other income (expense), net. As of December 31, 2011, the total notional amount of the Company's forward contracts used as fair value hedges was $49.8 million.

Embedded Derivatives

In addition to hedging activities, the Company's foreign subsidiary in Argentina was party to U.S. dollar denominated lease contracts which the Company determined contained embedded derivatives. As such, the Company bifurcated the embedded derivatives features of the lease contracts and valued these features as foreign currency derivatives. In 2011, the Company amended its leases reducing the fair value to zero as of December 31, 2011.

Derivative Valuation and Settlements

The Company's derivatives as of December 31, 2011 and 2010 were as follows (amounts in thousands):

   December 31, 2011
   Designated as hedging instruments Not Designated as Hedging Instruments
Derivative contracts: Foreign Exchange Interest Rate Foreign ExchangeLeases
Derivative classification: Cash Flow  Cash Flow Fair ValueEmbedded Derivative
            
Fair value and location of derivative in          
 the Consolidated Balance Sheet:          
Prepaids and other current assets $ 2,325$ - $ 12$ -
Other long-term assets   1,119  -   -  -
Other current liabilities   (7,828)  -   (341)  -
Other long-term liabilities   (2,786)  (2,263)   -  -
            
 Total fair value of derivatives, net $ (7,170)$ (2,263) $ (329)$ -
            

   December 31, 2010
   Designated as hedging instruments Not designated as hedging instruments
Derivative contracts: Foreign Exchange  Interest Rate Foreign Exchange Leases
Derivative classification: Cash Flow   Cash Flow Fair Value Embedded Derivative
              
Fair value and location of derivative in            
 the Consolidated Balance Sheet:            
Prepaids and other current assets $ 10,602 $ - $ 783 $ -
Other long-term assets   2,081   -   -   -
Other current liabilities   (677)   -   (58)   (105)
Other long-term liabilities   (104)   -   -   (34)
              
 Total fair value of derivatives, net $ 11,902 $ - $ 725 $ (139)
              

The effect of derivative instruments on the Consolidated Statements of Operations and Comprehensive Income for the year ended December 31, 2011 and 2010 were as follows (amounts in thousands):

   Year Ended December 31,
   2011 2010
   Designated as hedging instruments Designated as hedging instruments
Derivative contracts: Foreign Exchange  Interest Rate Foreign Exchange  Interest Rate
Derivative classification: Cash Flow   Cash Flow Cash Flow   Cash Flow
              
Amount of gain or (loss) recognized in other            
 comprehensive income - effective portion, net of tax: $ (6,003) $ (1,358) $ 8,513 $ -
              
Amount and location of net gain or (loss) reclassified            
 from accumulated OCI to income - effective portion:            
Revenue $ 9,297 $ - $ 9,817 $ -
              
Amount and location of net gain or (loss) reclassified            
 from accumulated OCI to income - ineffective portion            
 and amount excluded from effectiveness testing:            
Other income (expense), net $ - $ - $ - $ -
              

   Year Ended December 31,
   2011 2010
   Not designated as hedging instruments Not designated as hedging instruments
Derivative contracts: Foreign Exchange Leases  Foreign Exchange  Leases
Derivative classification: Option and Forward Contracts Fair Value Embedded Derivative Option and Forward Contracts Fair Value Embedded Derivative
                    
Amount and location of net gain or                  
 (loss) recognized in the Consolidated             
 Statement of Operations:                  
Cost of services $ - $ - $ 139 $ - $ - $ 230
Other income (expense), net   -   (1,178)   -   (42)   3,693   -