Accrued Expenses

Accrued expenses at April 30, 2016 and October 31, 2015 consisted of the following (amounts in thousands):



	April 30, 2016		October 31, 2015
Land, land development, and construction	$	114,402	$	118,634
Compensation and employee benefits	121,709		125,045
Self-insurance	111,719		113,727
Warranty	91,194		93,083
Interest	35,003		26,926
Commitments to unconsolidated entities	5,555		5,534
Other	125,616		125,117
	$	605,198	$	608,066

As previously disclosed in Note 7, “Accrued Expenses” in our 2015 Form 10-K, we determined that we will need to make stucco-related repairs to homes in certain completed communities located in Pennsylvania and Delaware (which are in our Mid-Atlantic region). At October 31, 2015, we estimated that the gross cost to make the stucco-related repairs was $80.3 million, of which approximately $32.6 million would be covered by our insurance carrier. Through October 31, 2015, we recorded approximately $47.7 million of expected warranty expense, net of expected insurance recoveries. At October 31, 2015, we had approximately $44.2 million of warranty reserves related to stucco remaining. After we completed our fiscal second quarter 2016 review of the potential liability for these stucco-related claims, we determined that the average cost had increased and that we needed an additional reserve of $5.1 million, of which we expect our insurance carrier to pay approximately $2.6 million. At April 30, 2016, we had approximately $43.6 million of warranty reserves remaining and our expected recovery from our insurance carrier was $35.2 million. We will continue to monitor our exposure and evaluate our stucco-related warranty reserves in the future. Due to the degree of judgment required and the potential for variability in our underlying assumptions, our actual future costs could differ from those estimated.

In addition, also as previously disclosed in Note 7, “Accrued Expenses” in our 2015 Form 10-K, we have received construction claims from three related multifamily community associations in California alleging issues with design and construction and damage to exterior common area elements. We believe that we have coverage under multiple owner controlled insurance policies with deductibles or self-insured retention requirements that vary from policy year to policy year. We completed a settlement of one of the claims during fiscal 2015. In addition, we completed a settlement on a second claim in December 2015, which was previously accrued for as of October 31, 2015. As of April 30, 2016, we believe that our existing reserves and insurance are sufficient. Due to issues related to insurance coverage on all three construction claims, the degree of judgment required, and the potential for variability in our underlying assumptions, our actual future costs could differ from those estimated.

We do not believe that any resolution of the above matters in excess of the amounts currently accrued would be material to our results of operations, liquidity, or on our financial condition.

We accrue for expected warranty costs at the time each home is closed and title and possession are transferred to the home buyer. Warranty costs are accrued based upon historical experience. The table below provides, for the periods indicated, a reconciliation of the changes in our warranty accrual (amounts in thousands):



	Six months ended April 30,						Three months ended April 30,
	2016			2015			2016			2015
Balance, beginning of period	$	93,083		$	86,282		$	90,661		$	84,695
Additions – homes closed during the period	10,967			8,253			6,471			4,335
Increase in accruals for homes closed in prior years	6,192			1,309			3,739			441
Charges incurred	(19,048		)	(12,787		)	(9,677		)	(6,414		)
Balance, end of period	$	91,194		$	83,057		$	91,194		$	83,057