Accrued Expenses and Other Current Liabilities

6 Months Ended

Jan. 31, 2023

Accrued Expenses and Other Current Liabilities

Accrued expenses and other current liabilities consist of the following at:


	January 31, 2023		July 31, 2022
Accrued wages and benefits	$	23,048,000	25,675,000
Accrued warranty obligations	7,553,000		9,420,000
Accrued contract costs	16,053,000		15,921,000

Accrued commissions and royalties	6,631,000		5,697,000
Accrued legal costs	1,454,000		2,514,000
Other	13,916,000		13,435,000
Accrued expenses and other current liabilities	$	68,655,000	72,662,000

Accrued contract costs represent direct and indirect costs on contracts as well as estimates of amounts owed for invoices not yet received from vendors or reflected in accounts payable.

Accrued warranty obligations as of January 31, 2023 relate to estimated liabilities for assurance type warranty coverage that we provide to our customers. We generally provide warranty coverage for some of our products for a period of at least one year from the date of delivery. We record a liability for estimated warranty expense based on historical claims, product failure rates, consideration of contractual obligations, future costs to resolve software issues and other factors. Some of our product warranties are provided under long-term contracts, the costs of which are incorporated into our estimates of total contract costs.

Changes in our accrued warranty obligations during the six months ended January 31, 2023 and 2022 were as follows:


	Six months ended January 31,
	2023		2022
Balance at beginning of period	$	9,420,000	17,600,000
Provision for warranty obligations	555,000		587,000
Adjustments for changes in estimates	(1,500,000)		(2,500,000)
Charges incurred	(922,000)		(1,956,000)


Balance at end of period	$	7,553,000	13,731,000

During the three and six months ended January 31, 2023 and 2022, we recorded benefits of $1,500,000 and $2,500,000, respectively, to cost of sales in our Terrestrial and Wireless Networks segment due to lower than expected warranty claims associated with previously acquired NG-911 technologies.