Annual report pursuant to Section 13 and 15(d)

Derivative Financial Instruments and Hedging Activities (Tables)

v2.4.0.8
Derivative Financial Instruments and Hedging Activities (Tables)
 12 Months Ended
Dec. 28, 2013
Outstanding Derivatives on Individual Contract Basis

The following table presents outstanding derivatives on an individual contract basis:

Fair Value of Derivatives
with Unrealized Gains		 Fair Value of Derivatives
with Unrealized Losses
December
2013		 December
2012		 December
2013		 December
2012
In thousands

Foreign currency exchange contracts designated as hedging instruments

 $ 15,964 $ 15,847 $ (46,627 ) $ (27,267 )

Foreign currency exchange contracts dedesignated as hedging instruments

 — 15 — (2,160 )

Foreign currency exchange contracts not designated as hedging instruments

 124 291 (164 ) (41 )

Total derivatives

 $ 16,088 $ 16,153 $ (46,791 ) $ (29,468 )

Derivative Assets and Liabilities Presented in Consolidated Balance Sheet Adjusted from Current Gross

VF records and presents the fair values of all of its derivative assets and liabilities in the Consolidated Balance Sheets on a gross basis, even though they are subject to master netting agreements. However, if VF were to offset and record the asset and liability balances of all of its forward foreign currency exchange contracts on a net basis in accordance with the terms of its master netting agreements, the amounts presented in the Consolidated Balance Sheets as of December 2013 and December 2012 would be adjusted from the current gross presentation as detailed in the following table:

 

     December 2013     December 2012  
     Derivative
Asset		     Derivative
Liability		     Derivative
Asset		     Derivative
Liability		  
     In thousands  

Gross amounts presented in the Consolidated Balance Sheets

    $ 16,088      $ (46,791 )    $ 16,153      $ (29,468 ) 

Gross amounts not offset in the Consolidated Balance Sheets

      (11,641 )      11,641        (5,225 )      5,225   
  

 

 

    

 

 

    

 

 

    

 

 

  

Net amounts

    $ 4,447      $ (35,150 )    $ 10,928      $ (24,243 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  
Derivative Assets and Liabilities Presented in Consolidated Balance Sheet Adjusted from Current Gross

VF records and presents the fair values of all of its derivative assets and liabilities in the Consolidated Balance Sheets on a gross basis, even though they are subject to master netting agreements. However, if VF were to offset and record the asset and liability balances of all of its forward foreign currency exchange contracts on a net basis in accordance with the terms of its master netting agreements, the amounts presented in the Consolidated Balance Sheets as of December 2013 and December 2012 would be adjusted from the current gross presentation as detailed in the following table:

 

     December 2013     December 2012  
     Derivative
Asset		     Derivative
Liability		     Derivative
Asset		     Derivative
Liability		  
     In thousands  

Gross amounts presented in the Consolidated Balance Sheets

    $ 16,088      $ (46,791 )    $ 16,153      $ (29,468 ) 

Gross amounts not offset in the Consolidated Balance Sheets

      (11,641 )      11,641        (5,225 )      5,225   
  

 

 

    

 

 

    

 

 

    

 

 

  

Net amounts

    $ 4,447      $ (35,150 )    $ 10,928      $ (24,243 ) 
  

 

 

    

 

 

    

 

 

    

 

 

  
Derivatives Classified as Current or Noncurrent Based on Maturity Dates

Derivatives are classified as current or noncurrent based on maturity dates, as follows:

 

      December
2013		     December
2012		  
     In thousands  

Other current assets

    $ 12,699      $ 13,629   

Accrued liabilities (Note J)

      (36,622 )      (22,013 ) 

Other assets (Note H)

      3,389        2,524   

Other liabilities (Note L)

      (10,169 )      (7,455 ) 
Effects of Cash Flow Hedging included in Consolidated Statements of Income and Consolidated Statements of Comprehensive Income

The effects of cash flow hedging included in VF’s Consolidated Statements of Income and Consolidated Statements of Comprehensive Income are summarized as follows:

Cash Flow Hedging

Relationships

 Gain (Loss) on Derivatives
Recognized in OCI
2013 2012 2011
In thousands

Foreign currency exchange

 $ (8,133 ) $ (9,555 ) $ 6,707

Interest rate

 — — (48,266 )

Total

 $ (8,133 ) $ (9,555 ) $ (41,559 )

Gain (Loss) Reclassified
from Accumulated OCI into Income

Location of Gain (Loss)

 2013 2012 2011
In thousands

Net sales

 $ 12,917 $ (6,569 ) $ 6,525

Cost of goods sold

 4,208 22,470 (16,958 )

Other income (expense), net

 (1,051 ) 3,704 (8,441 )

Interest expense

 (3,905 ) (3,722 ) (2,424 )

Total

 $ 12,169 $ 15,883 $ (21,298 )

Effects of Fair Value Hedging Included in Consolidated Statements of Income

Following is a summary of these derivatives included in VF’s Consolidated Statements of Income:

Derivatives Not

Designated

as Hedges

Location of Gain (Loss) on
Derivatives

Recognized in Income

 Gain (Loss) on Derivatives
Recognized in Income
2013 2012 2011
In thousands

Foreign currency exchange

 Other income (expense), net $ (2,664 ) $ 1,443 $ 3,995