ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

Through December 31, 2016, we designated our commodity derivatives as cash flow hedges for accounting purposes upon entering into the contracts, and accordingly, changes in the fair value of the derivative were recognized in stockholders’ equity through other comprehensive income (loss), net of related taxes, to the extent the hedge was considered effective. We had no outstanding derivative contracts at December 31, 2016.

During the periods from March 1, 2017 through June 30, 2017 (Successor) and January 1, 2017 through February 28, 2017 (Predecessor), we entered into various commodity derivative contracts (see Note 9 – Derivative Instruments and Hedging Activities). With respect to our 2017 and 2018 commodity derivative contracts, we have elected to not designate these contracts as cash flow hedges for accounting purposes. Accordingly, the net changes in the mark-to-market valuations and the monthly settlements on these derivative contracts will be recorded in earnings through derivative income (expense).

Changes in accumulated other comprehensive income (loss) by component for the three and six months ended June 30, 2016 (Predecessor), were as follows (in millions):



	Cash Flow Hedges
Three Months Ended June 30, 2016 (Predecessor)
Beginning balance, net of tax	$	18.7
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives	(8.6		)
Income tax effect	3.1
Net of tax	(5.5		)
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/natural gas production	8.9
Income tax effect	(3.1		)
Net of tax	5.8
Other comprehensive loss, net of tax	(11.3		)
Ending balance, net of tax	$	7.4




	Cash Flow Hedges			Foreign Currency Items			Total
Six Months Ended June 30, 2016 (Predecessor)
Beginning balance, net of tax	$	24.0		$	(6.0	)	$	18.0
Other comprehensive income (loss) before reclassifications:
Change in fair value of derivatives	(4.0		)	—			(4.0		)
Income tax effect	1.4			—			1.4
Net of tax	(2.6		)	—			(2.6		)
Amounts reclassified from accumulated other comprehensive income:
Operating revenue: oil/natural gas production	21.7			—			21.7
Other operational expenses	—			(6.0		)	(6.0		)
Income tax effect	(7.7		)	—			(7.7		)
Net of tax	14.0			(6.0		)	8.0
Other comprehensive income (loss), net of tax	(16.6		)	6.0			(10.6		)
Ending balance, net of tax	$	7.4		$	—		$	7.4

During the six months ended June 30, 2016 (Predecessor), we reclassified approximately $6.0 million of losses related to cumulative foreign currency translation adjustments from accumulated other comprehensive income into other operational expenses upon the substantial liquidation of our foreign subsidiary, Stone Energy Canada ULC.