Korn Ferry Annual report pursuant to Section 13 and 15(d)

Annual report pursuant to Section 13 and 15(d)

Financial Instruments (Tables)

Financial Instruments (Tables)

12 Months Ended

Apr. 30, 2020

Financial Instruments and Balance Sheet Classification

The following tables show the Company’s financial instruments and balance sheet classification as of April 30, 2020 and 2019:

	April 30, 2020
	Fair Value Measurement									Balance Sheet Classification
	Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash and Cash Equivalents		Marketable Securities, Current		Marketable Securities, Non-current		Income Taxes & Other Receivables
	(in thousands)
Changes in Fair Value Recorded in
Other Comprehensive Income
Level 2:
Commercial paper	$	19,132	$	39	$	—		$	19,171	$	4,785	$	14,386	$	—	$	—
Corporate notes/bonds		19,181		26		(19	)		19,188		901		18,287		—		—
Total debt investments	$	38,313	$	65	$	(19	)	$	38,359	$	5,686	$	32,673	$	—	$	—

Changes in Fair Value Recorded in
Net Income
Level 1:
Mutual funds (1)								$	141,412	$	—	$	9,278	$	132,134	$	—
Total equity investments								$	141,412	$	—	$	9,278	$	132,134	$	—
Cash								$	611,795	$	611,795	$	—	$	—	$	—
Money market funds									71,763		71,763		—		—		—
Level 2:
Foreign currency forward contracts									2,634		—		—		—		2,634
Total								$	865,963	$	689,244	$	41,951	$	132,134	$	2,634

	April 30, 2019
	Fair Value Measurement								Balance Sheet Classification
	Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash and Cash Equivalents		Marketable Securities, Current		Marketable Securities, Non- current		Income Taxes & Other Receivables
	(in thousands)
Changes in Fair Value Recorded in
Other Comprehensive Income
Level 2:
Interest rate swap	$	—	$	619	$	—	$	619	$	—	$	—	$	—	$	619

Changes in Fair Value Recorded in
Net Income
Level 1:
Mutual funds (1)							$	140,751	$	—	$	8,288	$	132,463	$	—
Total equity investments							$	140,751	$	—	$	8,288	$	132,463	$	—
Cash							$	579,998	$	579,998	$	—	$	—	$	—
Money market funds								46,362		46,362		—		—		—
Level 2:
Foreign currency forward contracts								99		—		—		—		99
Total							$	767,829	$	626,360	$	8,288	$	132,463	$	718

(1)

These investments are held in trust for settlement of the Company’s vested obligations of $124.6 million and $122.3 million as of April 30, 2020 and 2019, respectively, under the ECAP (see Note 6 — Deferred Compensation and Retirement Plans). Unvested obligations under the deferred compensation plans totaled $21.7 million and $24.6 million as of April 30, 2020 and 2019, respectively. During fiscal 2020, the fair value of the investments decreased; therefore, the Company recognized loss of $1.8 million, which was recorded in other (loss) income, net. During fiscal 2019 and 2018, the fair value of the investments increased; therefore, the Company recognized income of $8.1 million, and $10.3 million, respectively, which was recorded in other (loss) income, net.

Financial Instruments and Balance Sheet Classification

The following tables show the Company’s financial instruments and balance sheet classification as of April 30, 2020 and 2019:

	April 30, 2020
	Fair Value Measurement									Balance Sheet Classification
	Cost		Unrealized Gains		Unrealized Losses			Fair Value		Cash and Cash Equivalents		Marketable Securities, Current		Marketable Securities, Non-current		Income Taxes & Other Receivables
	(in thousands)
Changes in Fair Value Recorded in
Other Comprehensive Income
Level 2:
Commercial paper	$	19,132	$	39	$	—		$	19,171	$	4,785	$	14,386	$	—	$	—
Corporate notes/bonds		19,181		26		(19	)		19,188		901		18,287		—		—
Total debt investments	$	38,313	$	65	$	(19	)	$	38,359	$	5,686	$	32,673	$	—	$	—

Changes in Fair Value Recorded in
Net Income
Level 1:
Mutual funds (1)								$	141,412	$	—	$	9,278	$	132,134	$	—
Total equity investments								$	141,412	$	—	$	9,278	$	132,134	$	—
Cash								$	611,795	$	611,795	$	—	$	—	$	—
Money market funds									71,763		71,763		—		—		—
Level 2:
Foreign currency forward contracts									2,634		—		—		—		2,634
Total								$	865,963	$	689,244	$	41,951	$	132,134	$	2,634

	April 30, 2019
	Fair Value Measurement								Balance Sheet Classification
	Cost		Unrealized Gains		Unrealized Losses		Fair Value		Cash and Cash Equivalents		Marketable Securities, Current		Marketable Securities, Non- current		Income Taxes & Other Receivables
	(in thousands)
Changes in Fair Value Recorded in
Other Comprehensive Income
Level 2:
Interest rate swap	$	—	$	619	$	—	$	619	$	—	$	—	$	—	$	619

Changes in Fair Value Recorded in
Net Income
Level 1:
Mutual funds (1)							$	140,751	$	—	$	8,288	$	132,463	$	—
Total equity investments							$	140,751	$	—	$	8,288	$	132,463	$	—
Cash							$	579,998	$	579,998	$	—	$	—	$	—
Money market funds								46,362		46,362		—		—		—
Level 2:
Foreign currency forward contracts								99		—		—		—		99
Total							$	767,829	$	626,360	$	8,288	$	132,463	$	718

(1)

Summary of Gains and Losses on Interest Rate Swap

During fiscal 2020, 2019 and 2018, the Company recognized the following gains and losses on the interest rate swap:

	Year Ended April 30,
	2020			2019			2018
	(in thousands)
(Losses) gains recognized in other comprehensive income (net of tax effects of $(238), $(281), and $828, respectively)	$	(678	)	$	(800	)	$	1,465
(Losses) gains reclassified from accumulated other comprehensive income into interest (expense) income, net	$	(297	)	$	376		$	(730	)

Fair Value of Liabilities Derivatives

The fair value of derivatives not designated as hedge instruments are as follows:

	April 30,
	2020		2019
	(in thousands)
Derivative assets:
Foreign currency forward contracts	$	3,034	$	821
Derivative liabilities:
Foreign currency forward contracts	$	400	$	722

Not Designated as Hedge Instrument

Fair Value of Assets Derivatives

The fair value of derivatives not designated as hedge instruments are as follows:

	April 30,
	2020		2019
	(in thousands)
Derivative assets:
Foreign currency forward contracts	$	3,034	$	821
Derivative liabilities:
Foreign currency forward contracts	$	400	$	722

Cash Flow Hedge

Fair Value of Derivative Designated as Cash Flow Hedge Instrument

The fair value of the derivative designated as a cash flow hedge instrument is as follows:

	April 30,
	2020		2019
	(in thousands)
Derivative asset:
Interest rate swap contract	$	—	$	619

- Definition

Tabular disclosure of financial instruments measured at fair value, including those classified in shareholders' equity measured on a recurring or nonrecurring basis. Disclosures include, but are not limited to, fair value measurements recorded and the reasons for the measurements, level within the fair value hierarchy in which the fair value measurements are categorized and transfers between levels 1 and 2. Nonrecurring fair value measurements are those that are required or permitted in the statement of financial position in particular circumstances.

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