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Derivative Financial Instruments
 12 Months Ended
Sep. 30, 2023
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
Derivative Financial Instruments

16. Derivative Financial Instruments

The following table shows our derivative instruments measured at gross fair value as reflected in the Consolidated Balance Sheets:

 

(in thousands)

 

Fair Value of Derivatives
Designated As Hedging
Instruments

 

 

Fair Value of Derivatives
Not Designated As
Hedging Instruments

 

 

 

September 30,

 

 

 

2023

 

 

2022

 

 

2023

 

 

2022

 

Derivative assets:(1)

 

 

 

 

 

 

 

 

 

 

 

 

Forward contracts

 

$

3,770

 

 

$

1,960

 

 

$

3,570

 

 

$

7,098

 

Derivative liabilities:(2)

 

 

 

 

 

 

 

 

 

 

 

 

Forward contracts

 

$

—

 

 

$

—

 

 

$

3,158

 

 

$

2,908

 
(1)
As of September 30, 2023 and 2022, current derivative assets of $7.3 million and $9.1 million, respectively, are recorded in Other current assets on the Consolidated Balance Sheets.
(2)
As of September 30, 2023 and 2022, current derivative liabilities of $3.2 million and $2.9 million, respectively, are recorded in Accrued expenses and other current liabilities on the Consolidated Balance Sheets.

Non-Designated Hedges

As of September 30, 2023 and 2022, we had outstanding forward contracts not designated as hedging instruments with notional amounts equivalent to the following:

 

 

 

September 30,

 

Currency Hedged (in thousands)

 

2023

 

 

2022

 

Canadian Dollar / U.S. Dollar

 

$

5,135

 

 

$

2,731

 

Euro / U.S. Dollar

 

 

383,227

 

 

 

316,869

 

British Pound / U.S. Dollar

 

 

6,058

 

 

 

7,368

 

Israeli Shekel / U.S. Dollar

 

 

11,852

 

 

 

12,052

 

Japanese Yen / U.S. Dollar

 

 

4,770

 

 

 

25,566

 

Swiss Franc / U.S. Dollar

 

 

32,766

 

 

 

25,559

 

Swedish Krona / U.S. Dollar

 

 

35,085

 

 

 

35,713

 

Singapore Dollar / U.S. Dollar

 

 

—

 

 

 

3,637

 

Chinese Renminbi / U.S. Dollar

 

 

16,660

 

 

 

23,965

 

New Taiwan Dollar / U.S. Dollar

 

 

11,855

 

 

 

13,906

 

Korean Won / U.S. Dollar

 

 

6,157

 

 

 

4,919

 

Danish Krone / U.S. Dollar

 

 

6,731

 

 

 

3,192

 

Australian Dollar / U.S. Dollar

 

 

452

 

 

 

3,269

 

All other

 

 

2,888

 

 

 

4,432

 

Total

 

$

523,636

 

 

$

483,178

 

The following table shows the effect of our non-designated hedges, including forward contracts and options, on the Consolidated Statements of Operations for the years ended September 30, 2023, 2022 and 2021:

 

(in thousands)

 

 

 

Year ended September 30,

 

 

 

Location of Gain (Loss)

 

2023

 

 

2022

 

 

2021

 

Net realized and unrealized gain (loss), excluding the underlying foreign currency exposure being hedged

 

Other income, net

 

$

(11,757

)

 

$

14,603

 

 

$

(6,055

)

In 2023, 2022 and 2021, foreign currency losses, net were $2.1 million, $0.9 million and $8.0 million, respectively.

Net Investment Hedges

As of September 30, 2023 and 2022, we had outstanding forward contracts designated as net investment hedges with notional amounts equivalent to the following:

 

 

 

September 30,

 

Currency Hedged (in thousands)

 

2023

 

 

2022

 

Euro / U.S. Dollar

 

$

337,923

 

 

$

110,466

 

Japanese Yen / U.S. Dollar

 

 

10,285

 

 

 

—

 

Total

 

$

348,208

 

 

$

110,466

 

 

 

The following table shows the effect of our derivative instruments designated as net investment hedges on the Consolidated Statements of Operations for the years ended September 30, 2023, 2022, and 2021:

 

(in thousands)

 

 

 

Year ended September 30,

 

 

 

Location of Gain (Loss)

 

2023

 

 

2022

 

 

2021

 

Gain (loss) recognized in OCI

 

OCI

 

$

(10,033

)

 

$

23,379

 

 

$

1,660

 

Gain (loss) reclassified from OCI to earnings

 

n/a

 

$

-

 

 

$

-

 

 

$

-

 

Gain recognized, excluded portion

 

Other income, net

 

$

4,241

 

 

$

1,797

 

 

$

1,249

 

 

As of September 30, 2023, we estimate that all amounts reported in Accumulated other comprehensive loss will be applied against exposed balance sheet accounts upon translation within the next three months.

Offsetting Derivative Assets and Liabilities

We have entered into master netting arrangements for our forward contracts that allow net settlements under certain conditions. Although netting is permitted, it is currently our policy and practice to record all derivative assets and liabilities on a gross basis in the Consolidated Balance Sheets.

The following table sets forth the offsetting of derivative assets as of September 30, 2023:

 

(in thousands)

 

Gross Amounts Offset in the Consolidated Balance Sheets

 

 

 

 

 

Gross Amounts Not Offset in the Consolidated Balance Sheets

 

 

 

 

As of September 30, 2023

 

Gross Amount of Recognized Assets

 

 

Gross Amounts Offset in the Consolidated Balance Sheets

 

 

Net Amounts of Assets Presented in the Consolidated Balance Sheets

 

 

Financial Instruments

 

 

Cash Collateral Received

 

 

Net Amount

 

Forward Contracts

 

$

7,340

 

 

$

—

 

 

$

7,340

 

 

$

(3,158

)

 

$

—

 

 

$

4,182

 

 

The following table sets forth the offsetting of derivative liabilities as of September 30, 2023:

 

(in thousands)

 

Gross Amounts Offset in the Consolidated Balance Sheets

 

 

 

 

 

Gross Amounts Not Offset in the Consolidated Balance Sheets

 

 

 

 

As of September 30, 2023

 

Gross Amount of Recognized Liabilities

 

 

Gross Amounts Offset in the Consolidated Balance Sheets

 

 

Net Amounts of Liabilities Presented in the Consolidated Balance Sheets

 

 

Financial Instruments

 

 

Cash Collateral Pledged

 

 

Net Amount

 

Forward Contracts

 

$

3,158

 

 

$

—

 

 

$

3,158

 

 

$

(3,158

)

 

$

—

 

 

$

—