DERIVATIVES

3 Months Ended

Mar. 31, 2012

DERIVATIVES [Abstract]

DERIVATIVES

(6)       DERIVATIVES

Cash Flow Hedges

The Company enters into foreign exchange and interest rate related 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 March 31, 2012, 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 three months ended March 31, 2012 and 2011 (amounts in thousands and net of tax):

	Three Months Ended March 31,
	2012		2011
Aggregate unrealized net gain/(loss) at beginning of year	$	(5,852)	$	7,091
Add: Net gain/(loss) from change in fair value of cash flow hedges		7,071		758
Less: Net (gain)/loss reclassified to earnings from effective hedges		26		(2,215)
Aggregate unrealized net gain/(loss) at end of period	$	1,245	$	5,634

The Company's foreign exchange cash flow hedging instruments as of March 31, 2012 and December 31, 2011 are summarized as follows (amounts in thousands). All hedging instruments are forward contracts unless noted otherwise.

As of March 31, 2012	Local Currency Notional Amount	U.S. Dollar Notional Amount			% Maturing in the Next 12 Months			Contracts Maturing Through
Canadian Dollar	20,500	$	19,935			62.2	%	March 2014
Costa Rican Colon	1,250,000		2,415			100.0	%	August 2012
Philippine Peso	11,260,000		255,373	(1)		48.3	%	December 2014
Mexican Peso (Forwards)	952,000		70,505			40.7	%	November 2014
Mexican Peso (Collars)	105,224		9,000	(3)		100.0	%	December 2012
British Pound Sterling	7,484		11,832	(2)		53.0	%	June 2014
		$	369,060

As of December 31, 2011	Local Currency Notional Amount	U.S. Dollar Notional Amount
Canadian Dollar	25,750	$	25,137
Costa Rican Colon	2,000,000		3,874
Philippine Peso	13,304,000		301,361	(1)
Mexican Peso (Forwards)	1,081,000		80,735
Mexican Peso (Collars)	140,298		12,000	(4)
British Pound Sterling	8,808		13,822	(2)
		$	436,929

(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 March 31, 2012 and December 31, 2011.

(2)       Includes contracts to purchase British pound sterling in exchange for Euros, which are translated into equivalent U.S. dollars on March 31, 2012 and December 31, 2011.

(3)       The Mexican peso collars include call options with a floor total of MXN 105.2 million and put options with a cap total of MXN (120.2 million) as of March 31, 2012.

(4)       The Mexican peso collars include call options with a floor total of MXN 140.3 million and put options with a cap total of MXN (157.0 million) as of December 31, 2011.

The Company's interest rate swap arrangements as of March 31, 2012 and December 31, 2011 were as follows:

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

Fair Value Hedges

The Company enters into foreign exchange forward contracts to economically 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 are recognized in earnings in Other income (expense), net. As of March 31, 2012 and December 31, 2011 the total notional amount of the Company's forward contracts used as fair value hedges were $67.3million and $49.8 million, respectively.

Embedded Derivatives

In addition to hedging activities, the Company's foreign subsidiary in Argentinawas party to U.S. dollar denominated lease contracts which the Company determined contain embedded derivatives. As such, the Company bifurcates the embedded derivative features of the lease contracts and valued these features as foreign currency derivatives. During 2011, the Company amended its leases to remove the embedded derivative feature which reduced the fair value to zero as of December 31, 2011.

Derivative Valuation and Settlements

The Company's derivatives as of March 31, 2012 and December 31, 2011 were as follows (amounts in thousands):

		March 31, 2012
		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		$	4,237	$	-	$	9	$	-
Other long-term assets			3,046		-		-		-
Other current liabilities			(2,135)		-		(38)		-
Other long-term liabilities			(377)		(2,535)		-		-
	Total fair value of derivatives, net	$	4,771	$	(2,535)	$	(29)	$	-
		December 31, 2011
		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		$	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)	$	-

The effects of derivative instruments on the Consolidated Statements of Comprehensive Income for the three months ended March 31, 2012 and 2011 were as follows (amounts in thousands):

		Three Months Ended March 31,
		2012				2011
		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:	$	7,234	$	(163)	$	570	$	188
Amount and location of net gain or (loss) reclassified
	from accumulated OCI to income - effective portion:
Revenue		$	(43)	$	-	$	3,691	$	-
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		$	-	$	-	$	-	$	-

		Three Months Ended March 31,
		2012						2011
		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:
Costs of services		$	-	$	-	$	-	$	-	$	-	$	44
Other income (expense), net		$	-	$	2,169	$	-	$	-	$	711	$	-