Hi,
Our company received insurance claim on destroyed capital asset and auditors asking to reduce the new capital asset value by insurance claim received on destroyed asset.
To my knowledge, insurance claim received to be shown as Misc. / other income, book value of asset destroyed to be written off and capitalize fully the value of asset bought.
Can you help me in this by providing to me any note / clarification by ICAI / any other juridicial body.
Regards.
as per the AS 5 of issued by ICAI and as per the materiality concept read wid AAS 5 issued by ICAI, the income from insurance company recived on destroy of capital should b shown seperately and not to b icluded in miscellenious income.
Gupta Sachdeva & Co. Chartered Accountants
New Delhi
CA Final
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