Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2011

Financial Instruments [Abstract]

Carrying amounts and fair values of the Company's financial instruments

The carrying amounts and fair value of the Company’s financial instruments are as follows:

		December 31, 2011				January 1, 2011
	Balance Sheet	Carrying		Fair		Carrying		Fair
	Location	Amount		Value		Amount		Value
Assets:
Accounts receivable	Accounts receivable, net of reserves	$	322,976	$	322,976	$	318,123	$	318,123
Open foreign currency exchange contracts	Prepaid expenses and other current assets		5,587		5,587		834		834
Interest rate cap	Other assets		6,276		6,276		—		—
Liabilities:
Accounts payable	Accounts payable	$	141,797	$	141,797	$	152,714	$	152,714
Short-term debt	Short-term debt		43,021		43,021		32,172		32,172
Open foreign currency exchange contracts	Accrued liabilities		532		532		3,282		3,282
2011 Term Loan, current portion	Short-term debt		2,000		1,980		—		—
2011 Term Loan	Long-term debt		197,000		195,030		—		—

Summary of Company's derivative instruments

The following table summarizes the Company’s derivative instruments as of December 31, 2011 and January 1, 2011:

		Asset Derivatives					Liability Derivatives
			Fair Value					Fair Value
		Balance Sheet	December 31,		January 1,		Balance Sheet	December 31,		January 1,
	Type (a)	Location	2011		2011		Location	2011		2011
Derivatives designated as hedging instruments under FASB ASC 815-20
Foreign exchange contracts	CF	Prepaid expenses and other current assets	$	1,308	$	—	Accrued liabilities	$	—	$	2,290
Interest rate cap	CF	Other assets		6,276		—	Other long-term liabilities		—		—
			$	7,584	$	—		$	—	$	2,290
Derivatives not designated as hedging instruments under FASB ASC 815-20
Foreign exchange contracts		Prepaid expenses and other current assets	$	4,279	$	834	Accrued liabilities	$	532	$	992
Total derivatives			$	11,863	$	834		$	532	$	3,282

(a) CF = cash flow hedge

Effect of derivative instruments on Consolidated Condensed Statements of Operations

The following table summarizes the effect of the Company’s derivative instruments on the Statement of Operations for Fiscal 2011, Fiscal 2010 and Fiscal 2009:

																					Location of
																					Gain (Loss)
		Amount of Gain (Loss) Recognized in									Location of Gain	Amount of Gain (Loss) Reclassified									Recognized	Amount of Gain (Loss) Recognized
		OCI on Derivatives									(Loss) Reclassified	from Accumulated OCI into Income									in Income on	in Income on Derivative
		(Effective Portion)									from Accumulated	(Effective Portion)									Derivative	(Ineffective Portion)
Derivatives in FASB ASC 815-20	Nature of Hedged	Fiscal			Fiscal			Fiscal			OCI into Income	Fiscal			Fiscal			Fiscal			(Ineffective	Fiscal		Fiscal			Fiscal
Cash Flow Hedging Relationships	Transaction	2011			2010			2009			(Effective Portion)	2011			2010			2009			Portion) (d)	2011		2010			2009
Foreign exchange contracts	Minimum royalty and advertising costs (a)	$	434		$	746		$	(450	)	cost of goods sold	$	(572	)	$	793		$	(314	)	other loss/income	$	15	$	(3	)	$	(1	)
Foreign exchange contracts	Purchases of inventory (b)		(140	)		(2,517	)		(1,868	)	cost of goods sold		(3,105	)		(1,260	)		(918	)	other loss/income		80		(45	)		(23	)
Interest rate cap	Interest expense on 2011 Term Loan (c)		(8,119	)		—			—		interest expense		1			—			—		other loss/income		—		—			—
Total		$	(7,825	)	$	(1,771	)	$	(2,318	)		$	(3,676	)	$	(467	)	$	(1,232	)		$	95	$	(48	)	$	(24	)

(a)	At December 31, 2011, the amount of minimum royalty and advertising costs hedged was $10,811; contracts expire through September 2012 .At January 1, 2011, the amount of minimum royalty and advertising costs hedged was $10,378; contracts expire through December 2011. At January 2, 2010, the amount of minimum royalty and advertising costs hedged was $9,213; contracts expire through September 2010.
(b)	At December 31, 2011, the amount of inventory purchases hedged was $45,500; contracts expire through November 2012. At January 1, 2011, the amount of inventory purchases hedged was $66,450; contracts expire through March 2012. At January 2, 2010, the amount of inventory purchases hedged was $26,760; contracts expire through April 2011.
(c)	see Note 12 of Notes to Consolidated Financial Statements — Interest Rate Cap Agreement
(d)	No amounts were excluded from effectiveness testing.

												Location of Gain	Amount of Gain (Loss) Recognized in
Derivatives not designated as			Amount Hedged						Maturity Date			(Loss) Recognized	Income on Derivative
hedging instruments under FASB	Nature of Hedged				Fiscal							in Income on							Fiscal
ASC 815-20	Transaction	Instrument	Fiscal 2011		2010		Fiscal 2009		Fiscal 2011	Fiscal 2010	Fiscal 2009	Derivative	Fiscal 2011			Fiscal 2010			2009
Foreign exchange contracts (e)	Purchases of inventory	Forward contracts	$	—	$	—	$	6,032			August 2010	other loss/income	$	—		$	(142	)	$	(2,865	)
Foreign exchange contracts (f)	Intercompany sales of inventory	Forward contracts		3,264		12,635		11,395	July 2012	April 2012	December 2010	other loss/income		—			(232	)		(387	)
Foreign exchange contracts (g)	Minimum royalty and advertising costs	Forward contracts		10,000		11,250		10,000	October 2012	January 2012	October 2010	other loss/income		48			185			(505	)
Foreign exchange contracts	Intercompany payables	Forward contracts		—		—		12,000			January 2010	other loss/income		—			—			8
Foreign exchange contracts	Intercompany loans	Forward contracts		34,500		20,000		—	August 2012	November 2011		other loss/income		2,001			1,007			—
Foreign exchange contracts	Intercompany loans	Zero-cost collars		—				1,500			June 2010	other loss/income		—			—			258
Foreign exchange contracts	Intercompany loans	Forward contracts		6,000		—		—	July 2012			other loss/income		(463	)		—			—
Foreign exchange contracts	Intercompany loans	Forward contracts		—		—		—				other loss/income		155			—			—
Foreign exchange contracts	Intercompany payables	Zero-cost collars		—		—		26,000			June 2010	other loss/income		—			1,511			1,420
Foreign exchange contracts	Intercompany payables	Forward contracts		30,000		31,000		—	August 2012	November 2011		selling, general and administrative		(820	)		534			—
Foreign exchange contracts	Intercompany payables	Zero-cost collars		—		—		14,500			May 2010	selling, general and administrative					(232	)		2,688
Total													$	921		$	2,631			617

(e)	Forward contracts used to offset 50% of U.S. dollar-denominated purchases of inventory by the Company’s foreign subsidiaries whose functional currencies were the Canadian dollar and Mexican peso, entered into by Warnaco Inc. on behalf of foreign subsidiaries.
(f)	Forward contracts used to offset 50% of Euro-denominated intercompany sales by a subsidiary whose functional currency is the Euro.
(g)	Forward contracts used to offset payment of minimum royalty and advertising costs related to sales of inventory by the Company’s foreign subsidiary whose functional currency was the Euro, entered into by Warnaco Inc. on behalf of a foreign subsidiary.

Reconciliation of the balance of Accumulated Other Comprehensive Income related to cash flow hedges of foreign exchange forward contracts

A reconciliation of the balance of Accumulated Other Comprehensive Income during Fiscal 2011, Fiscal 2010 and Fiscal 2009 related to cash flow hedges of foreign exchange forward contracts is as follows:

Balance January 3, 2009	$	(328	)
Derivative losses recognized		(2,342	)
Amount amortized to earnings		1,256
Balance before tax effect		(1,414	)
Tax effect		387
Balance January 2, 2010, net of tax		(1,027	)
Derivative losses recognized		(1,771	)
Losses amortized to earnings		467
Balance before tax effect		(2,331	)
Tax effect		484
Balance January 1, 2011, net of tax		(1,847	)
Derivative losses recognized		(7,825	)
Losses amortized to earnings		3,676
Balance before tax effect		(5,996	)
Tax effect		2,059
Balance December 31, 2011, net of tax	$	(3,937	)