Accrued Expenses

Accrued expenses consist of accruals for the following (in thousands):



	September 30, 2017		December 31, 2016
Salaries and wages	$	35,162	$	32,959
Warranty cost	23,116		23,302
Taxes other than income taxes, primarily value added taxes	21,340		19,194
Professional	4,817		4,728
Freight	4,248		5,211
Interest	3,973		3,747
Severance	2,814		2,049
Product liability, current portion	2,472		3,996
Deferred revenue	1,899		1,446
Derivative liabilities (foreign currency forward exchange contracts)	1,865		1,783
Insurance	785		742
Rent	638		672
Marketing	501		356
Supplemental Executive Retirement Program liability	391		391
Other items, principally trade accruals	9,991		9,519
Accrued Expenses	$	114,012	$	110,095

Accrued rebates relate to several volume incentive programs the company offers its customers. The company accounts for these rebates as a reduction of revenue when the products are sold in accordance with the guidance in ASC 605-50, Customer Payments and Incentives.

Generally, the company's products are covered by warranties against defects in material and workmanship for various periods depending on the product from the date of sales to the customer. Certain components carry a lifetime warranty. A provision for estimated warranty cost is recorded at the time of sale based upon actual experience. The company continuously assesses the adequacy of its product warranty accrual and records adjustments as needed. Historical analysis is primarily used to determine the company's warranty reserves. Claims history is reviewed and provisions are adjusted as needed. However, the company does consider other events, such product field actions and recalls, which could warrant additional warranty reserve provision.

The following is a reconciliation of the changes in accrued warranty costs for the reporting period (in thousands):



Balance as of January 1, 2017	$	23,302
Warranties provided during the period	7,268
Settlements made during the period	(8,119		)
Changes in liability for pre-existing warranties during the period, including expirations	665
Balance as of September 30, 2017	$	23,116