Derivatives and Hedging

9 Months Ended

Sep. 30, 2013

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives and Hedging

Derivatives and Hedging

The Company enters into a limited number of derivative contracts to offset the potentially negative economic effects of interest rate and foreign exchange movements. The Company accounts for its outstanding derivative contracts in accordance with FASB ASC Topic 815, which requires all derivatives, including derivatives designated as accounting hedges, to be recorded on the balance sheet at fair value. The following tables provide information regarding the Company’s outstanding derivatives contracts (in thousands, except for number of outstanding contracts) as of the dates indicated:

September 30, 2013
Derivative Contract Type	Number of Outstanding Contracts	Notional Amounts		Fair Value Asset (Liability), Net (3)			Balance Sheet Line Item	Unrealized Loss Recorded in OCI
Interest rate swap (1)	1	$	200,000	$	(7,291	)	Other liabilities	$	(4,374	)
Foreign currency forwards (2)	32	15,000		(52		)	Accrued Liabilities	—
Total	33	$	215,000	$	(7,343	)		$	(4,374	)

December 31, 2012
Derivative Contract Type	Number of Outstanding Contracts	Notional Amounts		Fair Value Asset (Liability), Net (3)			Balance Sheet Line Item	Unrealized Loss Recorded in OCI
Interest rate swap (1)	1	$	200,000	$	(10,000	)	Other liabilities	$	(6,010	)
Foreign currency forwards (2)	68	76,100		4			Current assets	—
Total	69	$	276,100	$	(9,996	)		$	(6,010	)

(1) This swap has been designated, and is accounted for, as a cash flow hedge of the forecasted interest payments on borrowings (see Note 7 — Debt). As a result, changes in fair value of this swap are deferred and are recorded in OCI, net of tax effect.

(2) The Company has foreign exchange transaction risk since it typically enters into transactions in the normal course of business that are denominated in foreign currencies that differ from the local functional currency. The Company enters into short-term foreign currency forward exchange contracts to offset the economic effects of these foreign currency transaction risks. These forward exchange contracts are accounted for at fair value with realized and unrealized gains and losses recognized in Other expense, net. outstanding contracts Substantially all of the contracts outstanding at September 30, 2013 matured by the end of October 2013.

(3) See Note 11 — Fair Value Disclosures for the determination of the fair value of these instruments.

The Company’s derivative counterparties are all large investment grade financial institutions. The Company did not have any collateral arrangements with its derivative counterparties, and none of the derivative contracts contained credit-risk guarantees.

The following table provides information regarding derivative gains and losses that have been recognized in the Condensed Consolidated Statements of Operations for the periods indicated (in thousands):

	Three Months Ended					Nine Months Ended
	September 30,					September 30,
Amount recorded in:	2013			2012		2013		2012
Interest expense, net (1)	$	1,034		$	907	$	2,981	$	2,657
Other expense (income), net (2)	(20		)	36		138		(563		)
Total expense, net	$	1,014		$	943	$	3,119	$	2,094

(1) Consists of interest expense from an interest rate swap contract.

(2) Consists of realized and unrealized gains and losses on foreign currency forward contracts.