Additional Balance Sheet and Cash Flow Information

The following information represents additional detail for selected line items included in the consolidated balance sheets at December 31, and the statements of cash flows for the years ended December 31.

Balance Sheet Information:

Inventories, net (in thousands):



	2017			2016
Raw materials and work in process	$	161,664		$	140,639
Motorcycle finished goods	289,530			285,281
Parts and accessories and general merchandise	139,363			122,264
Inventory at lower of FIFO cost or net realizable value	590,557			548,184
Excess of FIFO over LIFO cost	(52,355		)	(48,267		)
Total inventories, net	$	538,202		$	499,917

Inventory obsolescence reserves deducted from FIFO cost were $38.7 million and $39.9 million as of December 31, 2017 and 2016, respectively.

Property, plant and equipment, at cost (in thousands):



	2017			2016
Land and related improvements	$	70,256		$	65,533
Buildings and related improvements	464,454			464,200
Machinery and equipment	1,890,126			1,887,269
Software	660,090			630,114
Construction in progress	200,396			214,409
	3,285,322			3,261,525
Accumulated depreciation	(2,317,541		)	(2,279,932		)
Total property, plant and equipment, net	$	967,781		$	981,593

Accrued liabilities (in thousands):



	2017		2016
Payroll, employee benefits and related expenses	$	124,093	$	148,221
Warranty and recalls	75,089		57,698
Sales incentive programs	48,309		43,218
Tax-related accruals	25,944		26,140
Fair value of derivative financial instruments	21,308		142
Accrued interest	40,347		42,788
Other	194,732		168,445
Total accrued liabilities	$	529,822	$	486,652

Cash Flow Information:

The reconciliation of net income to net cash provided by operating activities of continuing operations is as follows (in thousands):



	2017			2016			2015
Cash flows from operating activities:
Net income	$	521,759		$	692,164		$	752,207
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization of intangibles	222,188			209,555			198,074
Amortization of deferred loan origination costs	82,911			86,681			93,546
Amortization of financing origination fees	8,045			9,252			9,975
Provision for long-term employee benefits	29,900			38,273			60,824
Employee benefit plan contributions and payments	(63,277		)	(55,809		)	(28,490		)
Stock compensation expense	32,491			32,336			29,433
Net change in wholesale finance receivables related to sales	35,172			(3,233		)	(113,970		)
Provision for credit losses	132,444			136,617			101,345
Gain on off-balance sheet asset-backed securitization	—			(9,269		)	—
Loss on debt extinguishment	—			118			1,099
Deferred income taxes	50,855			(165		)	(16,484		)
Other, net	8,559			(6,907		)	20,913
Changes in current assets and liabilities:
Accounts receivable, net	(18,149		)	(45,934		)	(13,665		)
Finance receivables – accrued interest and other	(1,313		)	(1,489		)	(3,046		)
Inventories	(20,584		)	85,072			(155,222		)
Accounts payable and accrued liabilities	10,128			38,237			138,823
Derivative instruments	1,866			(3,413		)	(5,615		)
Other	(27,934		)	(27,747		)	30,371
Total adjustments	483,302			482,175			347,911
Net cash provided by operating activities	$	1,005,061		$	1,174,339		$	1,100,118

Cash paid during the period for interest and income taxes (in thousands):



	2017		2016		2015
Interest	$	204,866	$	185,804	$	148,654
Income taxes	$	300,113	$	356,553	$	371,547

Interest paid represents interest payments of HDFS (included in financial services interest expense) and interest payments of the Company (included in interest expense).