F. Detail of Selected Balance Sheet Accounts

Allowance for Doubtful Accounts

Activity in our allowance for doubtful accounts receivable consisted of the following (in thousands):


	September 30,
	2012	2011
Balance at beginning of year	$ 391	$ 907
Increase (decrease) to bad debt expense	842	(114)
Deductions for uncollectible accounts written off, net of recoveries	142	(394)
Increase (decrease) due to foreign currency translation	24	(8)
Balance at end of year	$ 1,399	$ 391

Warranty Accrual

Activity in our product warranty accrual consisted of the following (in thousands):


	September 30,
	2012	2011
Balance at beginning of year	$ 4,603	$ 5,929
Increase to warranty expense	3,624	788
Deductions for warranty charges	(2,323)	(2,432)
Increase (decrease) due to foreign currency translation	(190)	318
Balance at end of year	$ 5,714	$ 4,603

In addition to our standard estimated warranty accrual, during fiscal year 2012, we recorded an additional $1.0 million of warranty expense related to the estimated costs to replace certain component parts which may be defective.

Inventories

The components of inventories are summarized below (in thousands):


	September 30,
	2012	2011
Raw materials, parts and subassemblies	$ 33,632	$ 38,400
Work-in-progress	6,422	5,892
Provision for excess and obsolete inventory	(7,137)	(7,652)
Total inventories	$ 32,917	$ 36,640

Cost and Estimated Earnings on Uncompleted Contracts

The components of costs and estimated earnings and related amounts billed on uncompleted contracts are summarized below (in thousands):


	September 30,
	2012	2011
Costs incurred on uncompleted contracts	$ 635,714	$ 475,525
Estimated earnings	168,480	131,367
	804,194	606,892
Less: Billings to date	754,604	599,847
Net underbilled position	$ 49,590	$ 7,045

Included in the accompanying balance sheets under the following captions:
Costs and estimated earnings in excess of billings on uncompleted contracts – underbilled	$ 86,734	$ 51,568
Billings in excess of costs and estimated earnings on uncompleted contracts – overbilled	(37,144)	(44,523)
Net underbilled position	$ 49,590	$ 7,045

Property, Plant and Equipment

Property, plant and equipment are summarized below (in thousands):


	September 30,		Range of
	2012	2011	Asset Lives
Land	$ 24,766	$ 7,640	—
Buildings and improvements	55,431	54,321	3 - 39 Years
Machinery and equipment	67,007	62,456	3 - 15 Years
Furniture and fixtures	2,940	3,203	3 - 10 Years
Construction in process	7,224	2,625	—
	157,368	130,245
Less: Accumulated depreciation	(78,716)	(70,608)
Total property, plant and equipment, net	$ 78,652	$ 59,637

The increases in land and construction in process are primarily the result of construction of facilities in Houston, Texas, and Acheson, Alberta, Canada.

Included in property and equipment are assets under capital lease of $1.8 million and $2.9 million at September 30, 2012 and 2011, with related accumulated depreciation of $1.0 million and $1.4 million, respectively. Depreciation expense, including the depreciation of capital leases, was $10.5 million, $10.6 million and $9.2 million for fiscal years 2012, 2011 and 2010, respectively.