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Liability for Warranty Returns | 6 Months Ended
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Jun. 30, 2018
Product Warranties Disclosures [Abstract] |
Liability for Warranty Returns | 14. LIABILITY FOR WARRANTY RETURNS Our products generally include warranties of 90 days to five years for product defects. We accrue for warranty returns at the time revenue is recognized based on our estimate of the cost to repair or replace the defective products. We engage in extensive product quality programs and processes, including actively monitoring and evaluating the quality of our component suppliers. Our products continue to become more complex in both size and functionality as many of our product offerings migrate from line card applications to total systems. The increasing complexity of our products will cause warranty incidences, when they arise, to be more costly. Our estimates regarding future warranty obligations may change due to product failure rates, material usage, and other rework costs incurred in correcting a product failure. In addition, from time to time, specific warranty accruals may be recorded if unforeseen problems arise. Should our actual experience relative to these factors be worse than our estimates, we will be required to record additional warranty expense. Alternatively, if we provide for more reserves than we require, we will reverse a portion of such provisions in future periods. The liability for warranty obligations totaled $10.1 million and $9.7 million at June 30, 2018 and December 31, 2017, respectively. During the three months ended March 31, 2017, we recorded a receivable and a reduction in warranty expense related to a settlement with a third party supplier for a defective component, the impact of which is reflected in the table below. These liabilities are included in accrued expenses in the accompanying Consolidated Balance Sheets. A summary of warranty expense and write-off activity for the three and six months ended June 30, 2018 and 2017 is as follows:
|  | Three Months Ended |  |  | Six Months Ended |
|  | June 30, |  |  | June 30, |
(In thousands) |  | 2018 |  |  | 2017 |  |  | 2018 |  |  | 2017 |
Balance at beginning of period |  | $ | 9,687 |  |  | $ | 8,988 |  |  | $ | 9,724 |  |  | $ | 8,548 |
Plus: Amounts charged to cost and expenses |  |  | 4,860 |  |  |  | 3,055 |  |  |  | 6,683 |  |  |  | 2,314 |
Less: Deductions |  |  | (4,436 | ) |  |  | (2,863 | ) |  |  | (6,296 | ) |  |  | (1,682 | )
Balance at end of period |  | $ | 10,111 |  |  | $ | 9,180 |  |  | $ | 10,111 |  |  | $ | 9,180 |

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- Definition The entire disclosure for standard and extended product warranties and other product guarantee contracts, including a tabular reconciliation of the changes in the guarantor's aggregate product warranty liability for the reporting period. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 460 -URI http://asc.fasb.org/topic&trid=2155896 + Details
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