DERIVATIVE FINANCIAL INSTRUMENTS

6 Months Ended

Jun. 30, 2013

DERIVATIVE FINANCIAL INSTRUMENTS [Abstract]

DERIVATIVE FINANCIAL INSTRUMENTS

4.DERIVATIVE FINANCIAL INSTRUMENTS

The Company held mark-to-market forward contracts designated as foreign currency cash flow hedges with notional amounts totaling 2.9 billion Japanese yen ($29.2 million as of June 30, 2013) and 3.7 billion Japanese yen ($46.3 million as of June 30, 2012) to hedge forecasted foreign-currency-denominated intercompany transactions.

The contracts held at June 30, 2013 have maturities through June 30, 2014 and accordingly, all unrealized gains and losses on foreign currency cash flow hedges included in accumulated other comprehensive income will be recognized in current earnings over the next 12 months. The pre-tax net losses/gains on foreign currency cash flow hedges reclassified from accumulated other comprehensive income to revenue were $1.4 million and $3.2 million for the three- and six-month periods ended June 30, 2013 and  were immaterial for the three- and six-month periods ended June 30, 2012. The corresponding tax effects of these transactions were recorded in provision for income tax expense. As of June 30, 2013 and December 31, 2012, there were $2.2 million and $1.9 million of unrealized gains included in accumulated other comprehensive income related to foreign currency cash flow hedges. The remaining $53.1 million and $49.9 million as of June 30, 2013 and December 31, 2012, respectively, in accumulated other comprehensive income are related to cumulative translation adjustments.