Accumulated Other Comprehensive Income (Loss)

3 Months Ended

Mar. 31, 2014

Accumulated Other Comprehensive Income (Loss)

11. Accumulated Other Comprehensive Income (Loss)

The following tables present changes in the accumulated balances for each component of other comprehensive income, including current period other comprehensive income and reclassifications out of accumulated other comprehensive income (loss):

	For the Three Months Ended March 31, 2014
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2013	$	(10,789	)	$	(131,946	)	$	(300,941	)	$	(443,676	)
Other comprehensive income before reclassifications		1,228			(92	)		3,872			5,008
Amounts reclassified from accumulated other comprehensive income (loss)		2,767			2,180			—			4,947
Net increase in other comprehensive income		3,995			2,088			3,872			9,955
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2014	$	(6,794	)	$	(129,858	)	$	(297,069	)	$	(433,721	)
	For the Three Months Ended March 31, 2013
	Derivative Instruments			Defined Benefit Pension Plans			Currency Translation Adjustments			Total
	(In thousands)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of December 31, 2012	$	(2,583	)	$	(190,656	)	$	(271,247	)	$	(464,486	)
Other comprehensive income before reclassifications		8,138			311			(27,379	)		(18,930	)
Amounts reclassified from accumulated other comprehensive income (loss)		(1,129	)		3,120			—			1,991
Net increase (decrease) in other comprehensive income		7,009			3,431			(27,379	)		(16,939	)
Accumulated Other Comprehensive Income (Loss), Net of Tax, as of March 31, 2013	$	4,426		$	(187,225	)	$	(298,626	)	$	(481,425	)

The following table presents the classification and amount of the reclassifications from accumulated other comprehensive income (loss) to the consolidated statement of operations:

	For the Three Months Ended March 31, 2014			For the Three Months Ended March 31, 2013			Statements of Operations Classification
	(In thousands)
Derivative Instruments
(Loss) gain on foreign currency forward exchange contracts	$	(2,718	)	$	1,131		Cost of sales
		(49	)		(2	)	Provision for income taxes
	$	(2,767	)	$	1,129		Net (loss) income
Defined Benefit Pension Plans
Amortization of prior service credit	$	264		$	126		(a)
Recognized actuarial loss		(3,662	)		(5,146	)	(a)
		(3,398	)		(5,020	)
		1,218			1,900		Provision for income taxes
	$	(2,180	)	$	(3,120	)	Net (loss) income

(a) The amortization of prior service credit and recognized actuarial loss are included in the computation of net periodic benefit cost. Refer to “Note 15 to the Consolidated Financial Statements—Employee Benefit Plans” of this Quarterly Report on Form 10-Q for additional information regarding Mattel’s net periodic benefit cost.

Currency Translation Adjustments

Mattel’s reporting currency is the US dollar. The translation of its net investments in subsidiaries with non-US dollar functional currencies subjects Mattel to the impact of currency exchange rate fluctuations in its results of operations and financial position. Assets and liabilities of subsidiaries with non-US dollar functional currencies are translated into US dollars at fiscal period-end exchange rates. Income, expense, and cash flow items are translated at weighted average exchange rates prevailing during the fiscal period. The resulting currency translation adjustments are recorded as a component of accumulated other comprehensive income (loss) within stockholders’ equity. Currency translation adjustments resulted in a net gain of $3.9 million for the three months ended March 31, 2014, primarily due to the strengthening of the Brazilian real, Australian dollar, and Indonesian rupiah against the US dollar, partially offset by the weakening of the Argentine peso. Currency translation adjustments resulted in a net loss of $27.4 million for the three months ended March 31, 2013, primarily due to the weakening of the Euro and British pound sterling against the US dollar, partially offset by the strengthening of the Mexican peso and Brazilian real.