PRODUCT WARRANTIES

3 Months Ended

Aug. 31, 2021

PRODUCT WARRANTIES

8. PRODUCT WARRANTIES

8. PRODUCT WARRANTIES

The Company provides for the estimated cost of product warranties at the time revenues are recognized on the products shipped. While the Company engages in extensive product quality programs and processes, including actively monitoring and evaluating the quality of its component suppliers, the Company’s warranty obligation is affected by product failure rates, material usage and service delivery costs incurred in correcting a product failure. Should actual product failure rates, material usage or service delivery costs differ from the Company’s estimates, revisions to the estimated warranty liability would be required.

The standard warranty period is one year for systems and ninety days for parts and service. 

The following is a summary of changes in the Company's liability for product warranties during the three months ended August 31, 2021 and 2020 (in thousands):

	Three Months Ended August 31,
	2021			2020
Balance at the beginning of the period	$	494		$	246
Accruals for warranties issued during the period		162			79
Adjustments to previously existing warranty accruals		-			76
Consumption of reserves		(151	)		(71	)
Balance at the end of the period	$	505		$	330

The accrued warranty balance is included in accrued expenses on the accompanying condensed consolidated balance sheets.