Derivative Financial Instruments (Notes)

9 Months Ended

Mar. 31, 2013

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Instruments and Hedging Activities Disclosure [Text Block]

Derivative Financial Instruments

Hedges of Interest Rate Risk

We have entered into interest rate swap contracts to manage differences in the amount, timing, and duration of our known or expected cash payments related to our long-term debt. Our objective in using interest rate derivatives is to add stability to interest expense and to manage our exposure to interest rate movements. Interest rate swaps designated as cash flow hedges involve the receipt of variable amounts from a counterparty in exchange for us making fixed-rate payments over the life of the derivative agreements without exchange of the underlying notional amount.

The effective portion of changes in the fair value of derivatives designated and that qualify as cash flow hedges is recorded in accumulated other comprehensive loss and is subsequently reclassified into earnings in the period that the hedged forecasted transaction affects earnings. During the three and nine months ended March 31, 2013, such derivatives were used to hedge the variable cash flows associated with our long-term debt. If a derivative is deemed to be ineffective, the ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. During the three and nine months ended March 31, 2013, we did not hold any derivative instruments that were determined to be ineffective.

Amounts reported in accumulated other comprehensive loss related to interest rate swap contracts will be reclassified to interest expense as interest payments are accrued or made on our variable-rate debt. Assuming these derivative instruments continue to qualify for hedge accounting, as of March 31, 2013, we estimate that $202 will be reclassified from accumulated other comprehensive loss to interest expense during the twelve months ending March 31, 2014. As of March 31, 2013, we had 7 outstanding interest rate swap contracts indexed to one-month LIBOR. These instruments were designated as cash flow hedges of interest rate risk and have varying start dates and maturity dates from 2013 - 2017. As the start date of certain contracts has not yet commenced, the notional amount of our outstanding contracts is in excess of the variable-rate debt being hedged as of the balance sheet date.

Interest rate swap contracts outstanding:	Notional Amounts
Contracts accruing interest as of March 31, 2013	$	100,000
Contracts with a future start date	95,000
Total	$	195,000

Hedges of Currency Risk

We have executed currency forward contracts in order to mitigate our exposure to fluctuations in various currencies against our reporting currency, the U.S. dollar. We use currency derivatives, specifically currency forward contracts, to manage this exposure. We currently have outstanding currency forward contracts that qualify as cash flow hedges intended to offset the effect of exchange rate fluctuations on our net income. Currency forward agreements involve fixing the exchange rate for delivery of a specified amount of currency on a specified date.

The effective portion of changes in the fair value of derivatives designated and qualifying as cash flow hedges is recorded in accumulated other comprehensive loss and is subsequently reclassified into earnings in the period in which the hedged forecasted transaction affects earnings. The ineffective portion of the change in fair value of the derivatives is recognized directly in earnings. Assuming our currency forward contracts continue to qualify for hedge accounting, as of March 31, 2013, we estimate that $350 will be reclassified from accumulated other comprehensive loss to earnings during the twelve months ending March 31, 2014.

As of March 31, 2013, we had the following outstanding currency forward contracts that were used to hedge fluctuations in the US Dollar value of forecasted transactions denominated in Canadian Dollar, Danish Krone, Great British Pound, Swedish Krona, and Swiss Franc:

Notional Amount	Effective Date	Maturity Date	Number of Instruments	Index
$22,450	November 8, 2012	Various 2013	15	Various

Financial Instrument Presentation

The table below presents the fair value of our derivative financial instruments as well as their classification on the balance sheet as of March 31, 2013 and June 30, 2012:

	Asset Derivatives						Liability Derivatives
	March 31, 2013			June 30, 2012			March 31, 2013			June 30, 2012
Derivative designated as hedging instrument	Balance Sheet Line Item	Fair Value		Balance Sheet Line Item	Fair Value		Balance Sheet Line Item	Fair Value		Balance Sheet Line Item	Fair Value
Interest rate swaps	Other current assets	$	—		$	—	Other current liabilities/other liabilities	$	309		$	—
Currency forward contracts	Other current assets	498			—		Other current liabilities	149			—
Total derivatives designated as hedging instruments		$	498		$	—		$	458		$	—

As of March 31, 2013 there is no material impact on our balance sheet presentation for the netting of derivative financial instruments.

The following table presents the effect of our derivative financial instruments designated as hedging instruments and their classification within comprehensive income for the three and nine months ended March 31, 2013:

Derivatives in Hedging Relationships	Amount of Gain (Loss) Recognized in Comprehensive Income on Derivatives (Effective Portion)
In thousands	Three months ended March 31, 2013			Nine months ended March 31, 2013
Interest Rate Swaps	$	(90	)	$	(367	)
Currency contracts that hedge revenue	1,058			407
Currency contracts that hedge cost of revenue	(137		)	(55		)
Currency contracts that hedge technology and development expense	(214		)	(4		)
Currency contracts that hedge general and administrative expense	(39		)	(24		)
	$	578		$	(43	)

The following table presents the effect of our de-designated derivative financial instruments that no longer qualify as hedging instruments and the mark to market impact recorded within the statement of operations:

Derivatives not classified as hedging instruments under ASC 815	Amount of Gain (Loss) Recognized in Income						Location of Gain (Loss) Recognized in Income (Ineffective Portion)
In thousands	Three months ended March 31, 2013			Nine months ended March 31, 2013
Currency contracts	$	(164	)	$	(112	)	Other income (expense)

No comparative information is presented as we did not have any derivative financial instruments during the three and nine months ended March 31, 2012.