Accrued Expenses

9 Months Ended

Jul. 31, 2024

Payables and Accruals [Abstract]

Accrued Expenses

Accrued Expenses

Accrued expenses at July 31, 2024 and October 31, 2023 consisted of the following (amounts in thousands):

	July 31, 2024		October 31, 2023
Land, land development, and construction	$	341,866	$	286,516
Liabilities related to consolidated inventory not owned	440,276		268,630
Compensation and employee benefits	193,924		212,684
Escrow liability associated with our wholly owned captive title company	66,199		42,451
Self-insurance	222,567		230,688
Warranty	210,980		206,171
Lease liabilities	127,423		123,866
Deferred income	52,650		52,907
Interest	30,368		30,044
Commitments to unconsolidated entities	38,069		29,212
Other	53,231		65,612
	$	1,777,553	$	1,548,781

The table below provides, for the periods indicated, a reconciliation of the changes in our warranty accrual (amounts in thousands):

	Three months ended July 31,				Nine months ended July 31,
	2024		2023		2024		2023
Balance, beginning of period	$	206,717	$	149,395	$	206,171	$	164,409
Additions – homes closed during the period	9,748		12,395		24,714		29,666
Change in accruals for homes closed in prior years – net	6,132		3,995		18,277		6,018
Charges incurred	(11,617)		(20,334)		(38,182)		(54,642)
Balance, end of period	$	210,980	$	145,451	$	210,980	$	145,451

Since fiscal 2014, we have received water intrusion claims from owners of homes built since 2002 in communities located in Pennsylvania and Delaware (which are in our North region). Our recorded estimated repair costs to resolve these claims were approximately $39.6 million at July 31, 2024 and $41.1 million at October 31, 2023. We continue to perform review procedures to assess, among other things, the number of affected homes, whether repairs are likely to be required, and the extent of such repairs.

Our review process, conducted quarterly, includes an analysis of many factors to determine whether a claim is likely to be received and the estimated costs to resolve any such claim, including: the closing dates of the homes; the number of claims received; our inspection of homes; an estimate of the number of homes we expect to repair; the type and cost of repairs that have been performed in each community; the estimated costs to remediate pending and future claims; the expected recovery from our insurance carriers and suppliers; and the previously recorded amounts related to these claims. We also monitor legal developments relating to these types of claims and review the volume, relative merits and adjudication of claims in litigation or arbitration. Our review process includes a number of estimates that are based on assumptions with uncertain outcomes. Due to the degree of judgment required in making these estimates and the inherent uncertainty in potential outcomes, it is reasonably possible that our actual costs and recoveries could differ from those recorded. However, based on the facts and circumstances currently known, we do not believe that any such differences would be material.