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Accrued Expenses and Other Liabilities
 12 Months Ended
Dec. 31, 2017
Payables and Accruals [Abstract]  
Accrued Expenses and Other Liabilities
7.    Accrued Expenses and Other Liabilities
Accrued expenses and other liabilities consist of the following:
 
December 31,
 
2017
 
2016
 
(Dollars in thousands)
 Warranty accrual(1)
$
6,859

 
$
4,931

 Accrued compensation and benefits
9,164

 
6,786

 Accrued interest
6,217

 
648

 Completion reserve
5,792

 
1,355

 Income taxes payable
6,368

 
7,147

 Deferred profit from unconsolidated joint ventures
136

 
957

 Other accrued expenses
3,518

 
1,594

 
$
38,054

 
$
23,418


 
 

(1)
Included in this amount for 2017 is approximately $1.2 million of additional warranty liabilities estimated to be covered by our insurance policies that were adjusted to present the warranty reserves and related estimated warranty insurance receivable on a gross basis at December 31, 2017. Of the $1.2 million adjusted in the current year, approximately $0.6 million related to prior year estimated warranty insurance recoveries. For further details, see Note 6 to our consolidated financial statements.    
Changes in our warranty accrual are detailed in the table set forth below:
 
Year Ended December 31,
 
2017
 
2016
 
2015
 
(Dollars in thousands)
Beginning warranty accrual for homebuilding projects
$
4,608

 
$
3,846

 
$
1,277

Warranty provision for homebuilding projects
1,825

 
1,921

 
2,802

Warranty assumed from joint ventures at consolidation
781

 
469

 
—

Warranty payments for homebuilding projects
(989
)
 
(563
)
 
(233
)
Adjustment to warranty accrual(1)
409

 
(1,065
)
 
—

Ending warranty accrual for homebuilding projects
6,634

 
4,608

 
3,846

 
 
 
 
 
 
Beginning warranty accrual for fee building projects
323

 
335

 
301

Warranty provision for fee building projects
—

 
—

 
57

Warranty efforts for fee building projects
(3
)
 
(12
)
 
(23
)
Adjustment to warranty accrual for fee building projects
(95
)
 
—

 
—

Ending warranty accrual for fee building projects
225

 
323

 
335

Total ending warranty accrual
$
6,859

 
$
4,931

 
$
4,181


 

(1)
Included in this amount for 2017 is approximately $1.2 million of additional warranty liabilities estimated to be covered by our insurance policies that were adjusted to present the warranty reserves and related estimated warranty insurance receivable on a gross basis at December 31, 2017. Of the $1.2 million adjusted in the current year, approximately $0.6 million related to prior year estimated warranty insurance recoveries. For further details, see Note 6. Netted against this amount is a warranty accrual adjustment recorded in 2017 of $0.8 million related to a lower experience rate of expected warranty expenditures.

We maintain general liability insurance designed to protect us against a portion of our risk of loss from construction-related warranty and construction defect claims. Our warranty accrual and related estimated insurance recoveries are based on historical claim and expense data, and expected recoveries from insurance carriers are recorded based on actual insurance claims and amounts determined using our warranty accrual estimates, our insurance policy coverage limits for the applicable policy years and historical recovery rates. Because of the inherent uncertainty and variability in these assumptions, our actual insurance recoveries could differ significantly from amounts currently estimated.


During 2017 and 2016, we recorded adjustments of $0.9 million and $1.1 million, respectively, to our warranty accrual due to a lower experience rate of expected warranty expenditures. In 2017, $0.8 million is included in "Adjustment to warranty accrual" and $63,000 is included in "Adjustment to warranty accrual for fee building projects" above. In 2016, $1.1 million is included in "Adjustment to warranty accrual" above. These adjustments resulted in a corresponding reduction of cost of homes sales and reduction of cost of fee building sales, respectively, in the consolidated statements of operation.