GUARANTEES AND PRODUCT WARRANTIES

12 Months Ended

Oct. 31, 2024

GUARANTEES AND PRODUCT WARRANTIES

GUARANTEES AND PRODUCT WARRANTIES

11.     GUARANTEES AND PRODUCT WARRANTIES

From time to time, our subsidiaries guarantee third party payment obligations in connection with the sale of machines to customers that use financing. We follow FASB guidance for accounting for guarantees (codified in ASC 460). As of October 31, 2024, we had nine outstanding third party payment guarantees totaling approximately $0.9 million. The terms of these guarantees are consistent with the underlying customer financing terms. Upon shipment of a machine, the customer assumes the risk of ownership. The customer does not obtain title, however, until it has paid for the machine. A retention of title clause allows us to recover the machine if the customer defaults on the financing. We accrue liabilities under these guarantees at fair value, which amounts are not material.

We provide warranties on our products with respect to defects in material and workmanship. The terms of these warranties are generally one year for machines and shorter periods for service parts. We recognize an estimated liability with respect to this obligation at the time of product sale, with subsequent warranty claims recorded against the estimated liability. The amount of the warranty estimated liability is determined based on historical trend experience and any known warranty issues that could cause future warranty costs to differ from historical experience. A reconciliation of the changes in our warranty estimated liability for each of the last three fiscal years is as follows (in thousands):

	2024		2023		2022
Balance, beginning of period	$	1,294	$	1,426	$	1,516
Provision for warranties during the period		2,296		2,629		2,915
Charges to the estimated liability		(2,527)		(2,792)		(2,877)
Impact of foreign currency translation		23		31		(128)
Balance, end of period	$	1,086	$	1,294	$	1,426

The decreases in our warranty estimated liability from October 31, 2023 to October 31, 2024 and from October 31, 2022 to October 31, 2023 were primarily due to decreases in the number of machines under warranty from decreased sales volume in fiscal years 2024 and 2023.