Did “Hurricane Sandy” Impact Your Company?
In late October, Hurricane Sandy which became tropical storm Sandy right before making landfall in the NY metro area caused severe damage in New Jersey and New York. The storm caused wide spread power outages, damaged property along the coast line, and disrupted business in New Jersey and New York. If the storm has affected your business, you may be eligible for insurance claims and you may need to disclose the damages resulting from the storm and the insurance claims your may be entitled to. Your footnote disclosures should include the damages that resulted from the claim if material and the potential insurance proceeds you may be receiving from such claims. Your footnote may need to disclose any material business interruption and any potential insurance proceeds for business interruption.
Additionally, any losses that resulted from the hurricane such as impairment on property and etc should be considered as expense and if material should be classified as a separate item with footnote disclosures. You should consult your accountants with respect to classification of loss in the income statement.
We also want to express the importance of contacting your accountants to discuss insurance recoveries. There are certain considerations needed to be met to recognize insurance recoveries in the period of the loss.