This excerpt taken from the GOOG 10-K filed Feb 12, 2010.
Fair Value Hedges
In November 2009, we began using forward contracts designated as fair value hedges to hedge foreign currency risks for our investments denominated in currencies other than the U.S. dollar. Gains and losses on these contracts are recognized in interest income and other, net along with the offsetting losses and gains of the related hedged items. We exclude changes in the time value for forward contacts from the assessment of hedge effectiveness and recognize them in interest income and other, net. The notional principal of foreign exchange contracts to purchase U.S. dollars with foreign currencies was $37.3 million at December 31, 2009.