FINANCIAL INSTRUMENTS

12 Months Ended

Mar. 31, 2021

Derivative Instruments and Hedges, Assets [Abstract]

Foreign Currency Contracts

The Company transacts business in various foreign countries and is therefore exposed to foreign currency exchange rate risk inherent in forecasted sales, cost of sales, and monetary assets and liabilities denominated in non-functional currencies. The Company has established risk management programs to protect against volatility in the value of non-functional currency denominated monetary assets and liabilities, and of future cash flows caused by changes in foreign currency exchange rates. The Company tries to maintain a partial or fully hedged position for certain transaction exposures, which are primarily, but not limited to, revenues, customer and vendor payments and inter-company balances in currencies other than the functional currency of the operating entity. The Company enters into short-term and long-term foreign currency derivatives contracts, including forward, swap, and options contracts to hedge only those currency exposures associated with certain assets and liabilities, primarily accounts receivable and accounts payable, and cash flows denominated in non-functional currencies. Gains and losses on the Company's derivative contracts are designed to offset losses and gains on the assets, liabilities and

transactions hedged, and accordingly, generally do not subject the Company to risk of significant accounting losses. The Company hedges committed exposures and does not engage in speculative transactions. The credit risk of these derivative contracts is minimized since the contracts are with large financial institutions and accordingly, fair value adjustments related to the credit risk of the counterparty financial institution were not material.

As of March 31, 2021, the aggregate notional amount of the Company's outstanding foreign currency derivative contracts was $8.9 billion as summarized below:


	Foreign Currency Amount		Notional Contract Value in USD
Currency	Buy	Sell	Buy		Sell
	(In millions)
Cash Flow Hedges
CNY	2,895	—	$	441	$	—
HUF	33,969	—	110		—
JPY	33,525	—	300		—
MXN	6,197	—	299
Other	N/A	N/A	282		62
			1,432		62
Other Foreign Currency Contracts
CAD	103	67	82		53
CNY	4,376	1,442	668		220
EUR	1,724	1,892	2,031		2,237
GBP	47	69	65		95
HUF	66,705	64,004	216		207
ILS	422	10	127		3
MXN	6,524	5,362	315		259
MYR	642	297	155		72
PLN	221	190	56		48
SEK	467	541	55		62
Other	N/A	N/A	210		175

			3,980		3,431
Total Notional Contract Value in USD			$	5,412	$	3,493

As of March 31, 2021 and 2020, the fair value of the Company's short-term foreign currency contracts was included in other current assets or other current liabilities, as applicable, in the consolidated balance sheets. Certain of these contracts are designed to economically hedge the Company's exposure to monetary assets and liabilities denominated in a non-functional currency and are not accounted for as hedges under the accounting standards. Accordingly, changes in the fair value of these instruments are recognized in earnings during the period of change as a component of interest and other, net in the consolidated statements of operations. The Company also has included net deferred gains and losses in accumulated other comprehensive loss, a component of shareholders' equity in the consolidated balance sheets, relating to changes in fair value of its foreign currency contracts that are accounted for as cash flow hedges. Deferred gains were immaterial as of March 31, 2021, and are expected to be recognized primarily as a component of cost of sales in the consolidated statement of operations primarily over the next twelve-month period, except for the USD JPY cross currency swap, which is further discussed below.

The Company entered into a USD JPY cross currency swap to hedge the foreign currency risk on the JPY term loan due April 2024, and the fair value of the cross currency swap was included in other assets as of March 31, 2021, and March 30, 2020. The changes in fair value of the USD JPY cross currency swap are reported in accumulated other comprehensive loss,

with the impact of the excluded component reported in interest and other, net. In addition, a corresponding amount is reclassified out of accumulated other comprehensive loss to interest and other, net to offset the remeasurement of the underlying JPY loan principal which also impacts the same line.

The following table presents the fair value of the Company's derivative instruments utilized for foreign currency risk management purposes at March 31, 2021 and 2020:


	Fair Values of Derivative Instruments
	Asset Derivatives					Liability Derivatives
		Fair Value					Fair Value
	Balance Sheet Location	March 31, 2021		March 31, 2020		Balance Sheet Location	March 31, 2021		March 31, 2020
	(In millions)
Derivatives designated as hedging instruments
Foreign currency contracts	Other current assets	$	23	$	7	Other current liabilities	$	16	$	47
Foreign currency contracts	Other assets	$	5	$	14	Other liabilities	$	—	$	—
Derivatives not designated as hedging instruments
Foreign currency contracts	Other current assets	$	31	$	83	Other current liabilities	$	32	$	103

The Company has financial instruments subject to master netting arrangements, which provide for the net settlement of all contracts with a single counterparty. The Company does not offset fair value amounts for assets and liabilities recognized for derivative instruments under these arrangements, and as such, the asset and liability balances presented in the table above reflect the gross amounts of derivatives in the consolidated balance sheets. The impact of netting derivative assets and liabilities is not material to the Company's financial position for any of the periods presented.