Meritage Homes Corporation Quarterly report pursuant to Section 13 or 15(d)

ORGANIZATION AND BASIS OF PRESENTATION (Tables)

6 Months Ended

Jun. 30, 2018

The table below outlines our surety bond and letter of credit obligations (in thousands):



	As of
	June 30, 2018				December 31, 2017
	Outstanding		Estimated work remaining to complete		Outstanding		Estimated work remaining to complete
Sureties:
Sureties related to owned projects and lots under contract	$	345,297	$	160,981	$	296,387	$	120,320
Total Sureties	$	345,297	$	160,981	$	296,387	$	120,320
Letters of Credit (“LOCs”):
LOCs for land development	74,254		N/A		70,922		N/A
LOCs for general corporate operations	3,750		N/A		3,750		N/A
Total LOCs	$	78,004	N/A		$	74,672	N/A

Accrued liabilities at June 30, 2018 and December 31, 2017 consisted of the following (in thousands):



	As of
	June 30, 2018		December 31, 2017
Accruals related to real estate development and construction activities	$	65,468	$	53,522
Payroll and other benefits	39,559		58,186
Accrued interest	13,404		15,369
Accrued taxes	15,218		14,067
Warranty reserves	23,659		23,328
Other accruals	16,462		16,604
Total	$	173,770	$	181,076

A summary of changes in our warranty reserves follows (in thousands):



	Three Months Ended June 30,						Six Months Ended June 30,
	2018			2017			2018			2017
Balance, beginning of period	$	23,812		$	22,477		$	23,328		$	22,660
Additions to reserve from new home deliveries	4,146			4,310			7,553			8,125
Warranty claims	(4,299		)	(3,167		)	(7,222		)	(7,165		)
Adjustments to pre-existing reserves	—			—			—			—
Balance, end of period	$	23,659		$	23,620		$	23,659		$	23,620