There was a insurance claim for loss by flood during the construction phase of a hydropower company. But the case was pending with the insurance company/ surveyor and the final settlement amount was not agreed/ decided until the commercial operation of the hydropower.
Now, when company started its commercial operation, final settlement amount was agreed with the insurance company and the portion of claim amount was received from the insurance company.
How should the claim received be accounted.?
(Note: Company has already capitalized the additional cost incurred for loss by flood, as the case was pending with the insurance company since long).
Can it be treated as an income?
CAclubindia
