Employee and Retiree Benefits

Deferred compensation benefits are as follows:



(In thousands)	August 25, 2018			August 26, 2017
Non-qualified deferred compensation	$	14,831		$	16,476
Supplemental executive retirement plan	2,309			2,534
Executive share option plan	935			1,498
Executive deferred compensation plan	421			447
Officer stock-based compensation	1,528			1,664
Total deferred compensation benefits	20,024			22,619
Less: current portion⁽¹⁾	(4,742		)	(3,349		)
Long-term deferred compensation benefits	$	15,282		$	19,270


(1)	Included in accrued compensation in the consolidated balance sheets.

Postretirement Health Care Benefits

Historically, we provided certain health care and other benefits for retired employees hired before April 1, 2001, who had fulfilled eligibility requirements at age 55 with 15 years of continuous service. During the first quarter of Fiscal 2017, we announced the termination of the remaining postretirement health care benefits to all participants. As of January 1, 2017, postretirement health care benefits were discontinued.

Changes in our postretirement health care liability were as follows:



(In thousands)	August 26, 2017
Balance at beginning of year	$	6,346
Interest cost	29
Service cost	16
Net benefits paid	(53		)
Plan amendment	(6,338		)
Balance at end of year	$	—

Net periodic postretirement benefit income for Fiscal 2017 and 2016 consisted of the following components:



	Year Ended
(In thousands)	August 26, 2017			August 27, 2016
Interest cost	$	29		$	327
Service cost	16			108
Amortization of prior service benefit	(40,444		)	(7,736		)
Amortization of net actuarial loss	15,648			1,612
Net periodic postretirement benefit income	$	(24,751	)	$	(5,689	)

For accounting purposes, we recognized net periodic postretirement income as presented in the previous table, due to the amortization of prior service benefit associated with the establishment of caps on the employer portion of benefits in Fiscal 2005 and the plan amendments made over the past five years.

Amounts not yet recognized in net periodic benefit cost and included in accumulated other comprehensive income (before taxes) are as follows:



(In thousands)	August 27, 2016
Prior service credit	$	(34,139	)
Net actuarial loss	15,648
Accumulated other comprehensive income	$	(18,491	)

Deferred Compensation Benefits

Non-Qualified Deferred Compensation

We have a Non-Qualified Deferred Compensation Program which permitted key employees to annually elect to defer a portion of their compensation until their retirement. The plan has been closed to any additional deferrals since January 2001. The retirement benefit to be provided is based upon the amount of compensation deferred and the age of the individual at the time of the contracted deferral. An individual generally vests at age 55 and 5 years of participation under the plan. For deferrals prior to December 1992, vesting occurs at the later of age 55 and 5 years of service from first deferral or 20 years of service. Deferred compensation expense was $1.1 million, $1.2 million and $1.3 million in Fiscal 2018, 2017, and 2016, respectively.

Supplemental Executive Retirement Plan ("SERP")

The primary purpose of this plan was to provide our officers and managers with supplemental retirement income for a period of 15 years after retirement. We have not offered this plan on a continuing basis to members of management since 1998. The plan was funded with individual whole life insurance policies (split dollar program) owned by the named insured officer or manager. We initially paid the life insurance premiums on the life of the individual and the individual would receive life insurance and supplemental cash payments during the 15 years following retirement. In October 2008, the plan was amended as a result of changes in the tax and accounting regulations and rising administrative costs. Under the redesigned SERP, the underlying life insurance policies previously owned by the insured individual became company-owned life insurance ("COLI") by a release of all interests by the participant and assignment to us as a prerequisite to participate in the SERP and transition from the Split Dollar Program. This program remains closed to new employee participation.

To assist in funding the deferred compensation and SERP liabilities, we have invested in COLI policies. The cash surrender value of these policies is presented in investment in life insurance in the accompanying balance sheets and consists of the following:



(In thousands)	August 25, 2018			August 26, 2017
Cash value	$	63,574		$	62,824
Borrowings	(35,277		)	(35,406		)
Investment in life insurance	$	28,297		$	27,418

Executive Share Option Plan

The Non-Qualified Share Option Program permitted participants in the Executive Share Option Plan (the "Executive Plan") to choose to defer a portion of their salary or other eligible compensation in the form of options to purchase selected securities, primarily equity-based mutual funds. These assets are treated as trading securities and are recorded at fair value. The Executive Plan has been closed to any additional deferrals since January 2005. The Executive Plan assets related to those options that will expire within a year are included in prepaid expenses and other assets in the accompanying balance sheets. The remaining assets are included in other assets. Total assets on August 25, 2018 and August 26, 2017 were $1.0 million and $1.6 million, respectively.

The difference between the asset and liability balances represents the additional 25% we contributed at the time of the initial deferrals to aid in potential additional earnings to the participant. This contribution is required to be paid back to us when the option is exercised. A participant may exercise his or her options per the plan document, but there is a requirement that after these dollars have been invested for 15 years the participant is required to exercise such option.

Executive Deferred Compensation Plan

In December 2006, we adopted the Winnebago Industries, Inc. Executive Deferred Compensation Plan (the "Executive Deferred Compensation Plan"). Under the Executive Deferred Compensation Plan, corporate officers and certain key employees may annually choose to defer up to 50% of their salary and up to 100% of their cash incentive awards. The assets are presented as other assets in the accompanying balance sheets. Such assets on August 25, 2018 and August 26, 2017 were $0.4 million and $0.4 million, respectively.

Profit Sharing Plan

We have a qualified profit sharing and contributory 401(k) plan for eligible employees. The plan provides quarterly discretionary matching cash contributions as approved by our Board of Directors. Contributions to the plan for Fiscal 2018, 2017, and 2016 were $2.3 million, $1.6 million, and $1.5 million, respectively.