Annual report pursuant to Section 13 and 15(d)

DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Tables)

v3.8.0.1
DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES (Tables)
 12 Months Ended
Dec. 30, 2017
Derivative Instruments and Hedging Activities Disclosure [Abstract]  
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
 
 
 
 
 
 
 
 
 
 
 
 
(In thousands)
 
2017
 
 
2016
 
 
2017
 
 
2016
Foreign currency exchange contracts designated as hedging instruments
 
$
17,639

 
 
$
103,340

 
 
$
(99,606
)
 
 
$
(25,292
)
Foreign currency exchange contracts not designated as hedging instruments
 
5,331

 
 
—

 
 
(432
)
 
 
(282
)
Total derivatives
 
$
22,970

 
 
$
103,340

 
 
$
(100,038
)
 
 
$
(25,574
)
Derivative Assets and Liabilities Presented in Consolidated Balance Sheet Adjusted from current Gross
VF records and presents the fair values of all 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 its foreign exchange forward 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 2017 and December 2016 would be adjusted from the current gross presentation to the net amounts as detailed in the following table:
 
 
2017
 
 
2016
(In thousands)
 
Derivative
Asset
 
Derivative Liability
 
 
Derivative
Asset
 
Derivative Liability
Gross amounts presented in the Consolidated Balance Sheets
 
$
22,970

 
$
(100,038
)
 
 
$
103,340

 
$
(25,574
)
Gross amounts not offset in the Consolidated Balance Sheets
 
(18,313
)
 
18,313

 
 
(22,341
)
 
22,341

Net amounts
 
$
4,657

 
$
(81,725
)
 
 
$
80,999

 
$
(3,233
)
VF records and presents the fair values of all 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 its foreign exchange forward 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 2017 and December 2016 would be adjusted from the current gross presentation to the net amounts as detailed in the following table:
 
 
2017
 
 
2016
(In thousands)
 
Derivative
Asset
 
Derivative Liability
 
 
Derivative
Asset
 
Derivative Liability
Gross amounts presented in the Consolidated Balance Sheets
 
$
22,970

 
$
(100,038
)
 
 
$
103,340

 
$
(25,574
)
Gross amounts not offset in the Consolidated Balance Sheets
 
(18,313
)
 
18,313

 
 
(22,341
)
 
22,341

Net amounts
 
$
4,657

 
$
(81,725
)
 
 
$
80,999

 
$
(3,233
)
Derivative Assets and Liabilities Presented in Consolidated Balance Sheet Adjusted from current Gross
VF records and presents the fair values of all 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 its foreign exchange forward 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 2017 and December 2016 would be adjusted from the current gross presentation to the net amounts as detailed in the following table:
 
 
2017
 
 
2016
(In thousands)
 
Derivative
Asset
 
Derivative Liability
 
 
Derivative
Asset
 
Derivative Liability
Gross amounts presented in the Consolidated Balance Sheets
 
$
22,970

 
$
(100,038
)
 
 
$
103,340

 
$
(25,574
)
Gross amounts not offset in the Consolidated Balance Sheets
 
(18,313
)
 
18,313

 
 
(22,341
)
 
22,341

Net amounts
 
$
4,657

 
$
(81,725
)
 
 
$
80,999

 
$
(3,233
)
VF records and presents the fair values of all 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 its foreign exchange forward 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 2017 and December 2016 would be adjusted from the current gross presentation to the net amounts as detailed in the following table:
 
 
2017
 
 
2016
(In thousands)
 
Derivative
Asset
 
Derivative Liability
 
 
Derivative
Asset
 
Derivative Liability
Gross amounts presented in the Consolidated Balance Sheets
 
$
22,970

 
$
(100,038
)
 
 
$
103,340

 
$
(25,574
)
Gross amounts not offset in the Consolidated Balance Sheets
 
(18,313
)
 
18,313

 
 
(22,341
)
 
22,341

Net amounts
 
$
4,657

 
$
(81,725
)
 
 
$
80,999

 
$
(3,233
)
Derivatives Classified as Current or Noncurrent Based on Maturity Dates
Derivatives are classified as current or noncurrent based on maturity dates, as follows:
(In thousands)
 
2017
 
 
2016
Other current assets
 
$
20,771

 
 
$
84,519

Accrued liabilities (Note K)
 
(87,205
)
 
 
(18,574
)
Other assets (Note I)
 
2,199

 
 
18,821

Other liabilities (Note M)
 
(12,833
)
 
 
(7,000
)
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:
(In thousands)

Cash Flow Hedging Relationships
 
Gain (Loss) on Derivatives Recognized in OCI
 
 
 
 
 
 
 
 
2017
 
 
2016
 
2015
Foreign currency exchange
 
$
(138,716
)
 
 
$
90,708

 
$
89,993

(In thousands)
 
Gain (Loss) Reclassified
from Accumulated OCI into Income
 
 
 
 
 
 
 
 
Location of Gain (Loss)
 
2017
 
 
2016
 
2015
Net sales
 
$
33,641

 
 
$
28,798

 
$
(68,543
)
Cost of goods sold
 
610

 
 
84,613

 
132,432

Selling, general and administrative expenses
 
(3,610
)
 
 
(4,314
)
 
(1,885
)
Other income (expense), net
 
(1,851
)
 
 
2,864

 
7,267

Interest expense
 
(4,723
)
 
 
(4,504
)
 
(4,295
)
Total
 
$
24,067

 
 
$
107,457

 
$
64,976

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:
(In thousands)

Derivatives Not Designated as Hedges
 
Location of Gain (Loss) on
Derivatives
Recognized in Income
 
 
Gain (Loss) on Derivatives Recognized in Income
 
 
 
 
 
 
 
 
 
 
2017
 
 
2016
 
2015
Foreign currency exchange
 
Cost of goods sold
 
 
$
(1,929
)
 
 
$
1,674

 
$
(4,179
)
Foreign currency exchange
 
Other income (expense), net
 
 
1,028

 
 
83

 
2,806

Total
 
 
 
 
$
(901
)
 
 
$
1,757

 
$
(1,373
)