Current Liabilities

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



	March 31, 2015		December 31, 2014
Salaries and wages	$	37,219	$	41,193
Taxes other than income taxes, primarily Value Added Taxes	19,241		24,812
Warranty cost	29,661		30,738
Supplemental Executive Retirement Program	13,237		21,517
Freight	6,851		6,202
Professional	6,196		6,723
Product liability, current portion	3,695		4,334
Rebates	1,777		1,722
Insurance	1,252		1,266
Interest	970		1,068
Derivative liabilities	4,808		2,526
Severance	2,824		4,209
Other items, principally trade accruals	12,925		10,165
	$	140,656	$	156,475

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.

As a result of the retirement of certain executives of the Company during 2015, SERP and deferred compensation payments of $8,280,000 and $805,000, respectively, were made during the three months ended March 31, 2015. Furthermore, based on the retirement agreements for the same executives, the Company estimates SERP and deferred compensation payments of $12,846,000 and $2,720,000, respectively, will be made by the end of the third quarter of 2015.

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 makes 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 as a product field action and recalls, which could warrant additional warranty reserve provision.

In 2014, the Company recorded additional warranty expense for product recalls which related to a stationary oxygen concentrator, a sieve bed component used within stationary oxygen concentrators and power wheelchair joysticks. These warranty reserves are subject to adjustment in future periods as new developments change the Company's estimate of the total cost of these matters. However, no additional warranty expense was recorded related to these three recalls for the three months ended March 2015.

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




Balance as of January 1, 2015	$	30,738
Warranties provided during the period	3,710
Settlements made during the period	(5,053		)
Changes in liability for pre-existing warranties during the period, including expirations	266
Balance as of March 31, 2015	$	29,661