DAMAGE TO COMPANY ASSETS: METHOD OF ACCOUNTING FOR THE NEGATIVE EVENT AND ANY INSURANCE COMPENSATION

The damage to the company's assets may concern products belonging to the company's inventories or multi-year tangible assets. Depending on the type of assets, the accounting recognition is profoundly different. As will be seen on the following pages, no particular problems arise concerning insurance compensation since compensation may be recognised when the receivable from the insurance company occurs in legal terms. The receivable can only be realised if it is quantitatively determined. This is never a problem since such a claim is established by the insurance contract signed by the company and the insurance company and by an expert's report assessing the damage suffered by the asset.