Derivative Instruments

9 Months Ended

Sep. 30, 2012

Derivative Instruments [Abstract]

Derivative Instruments

14. Derivative Instruments

The Company periodically uses derivative instruments to manage risk from changes in market conditions that may affect the Company's financial performance. The Company primarily uses derivative instruments to manage its primary market risks, which are interest rate risk and foreign currency exchange rate risk.

During 2011, the Company used interest rate cap agreements for the purpose of managing interest rate exposure on its floating rate debt, but did not enter into any interest rate cap agreements during the nine-month period ended September 30, 2012. For derivatives designated as cash flow hedges, the effective portions of changes in the estimated fair value of the derivative are reported in “Accumulated other comprehensive income (loss)” (“OCI”) and are subsequently reclassified into earnings when the hedged item affects earnings. The change in the estimated fair value of the ineffective portion of the hedge, if any, wasrecorded as income or expense. As of September 30, 2012, the Company had no interest rate cap agreements outstanding.

The Company uses forward currency exchange contracts to minimize the effects of foreign currency risk. For the nine months ended September 30, 2012 and 2011, the Company had forward currency exchange contracts outstanding related to its operations in the United Kingdom andAustralia.The Company's forward currency exchange contracts are non-designated derivatives. Any gain or loss resulting from these contracts is recorded as income or loss and is included in “Foreign currency transaction gain (loss)” in the Company's consolidated statements of income.

The fair values of the Company's derivative instruments at September 30, 2012 and 2011 and December 31, 2011 were as follows (dollars in thousands):

		Balance at
Assets	Balance Sheet Location	September 30, 2012					September 30, 2011				December 31, 2011
Derivatives designated as hedges:			Notional Amount		Fair Value		Notional Amount		Fair Value		Notional Amount		Fair Value
Interest rate contracts	Prepaid expenses and other assets	$	-	$	-	$	30,000	$	1	$	15,000	$	-
Non-designated derivatives:
Forward currency exchange contracts	Prepaid expenses and other assets	$	93,642	$	(307)	$	64,767	$	311	$	80,375	$	260

The following table presents information on the effect of derivative instruments on the consolidated results of operations and OCI for the three and nine months endedSeptember 30, 2012 and 2011 (dollars in thousands):

		Gains (Losses) Recognized in Income				Gains Recognized in OCI				Gains (Losses) Reclassified From OCI into Income
		Three Months Ended				Three Months Ended				Three Months Ended
		September 30,				September 30,				September 30,
		2012		2011		2012		2011		2012		2011
Derivatives designated as hedges:
Interest rate contracts	$	-	$	-	$	-	$	31	$	-	$	-
Total	$	-	$	-	$	-	$	31	$	-	$	-
Non-designated derivatives:
Forward currency exchange contracts(a)	$	(4,097)	$	4,090	$	-	$	-	$	-	$	-
Total	$	(4,097)	$	4,090	$	-	$	-	$	-	$	-

		Gains (Losses) Recognized in Income				Gains Recognized in OCI				Gains (Losses) Reclassified From OCI into Income
		Nine Months Ended				Nine Months Ended				Nine Months Ended
		September 30,				September 30,				September 30,
		2012		2011		2012		2011		2012		2011
Derivatives designated as hedges:
Interest rate contracts	$	-	$	-	$	12	$	70	$	-	$	-
Total	$	-	$	-	$	12	$	70	$	-	$	-
Non-designated derivatives:
Forward currency exchange contracts(a)	$	(5,118)	$	2,382	$	-	$	-	$	-	$	-
Total	$	(5,118)	$	2,382	$	-	$	-	$	-	$	-

(a)

The gains/(losses) on these derivatives substantially offset the (losses)/gains on the hedged portion of foreign intercompany balances.