Insurance claims

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amit gupta

amit gupta (Querist)
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03 March 2012 loss of stock main abnormal loss ka kya karte hai n pura procedure bata do plz.....abnormal loss ka..

Dsouza

Dsouza (Expert)
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06 March 2012 Your question is not clear, please redifine with more input.
Is it theft, skimming, cash larceny, items stolen, Misuse, fraudulent disbursement via forged cheques - false invoices - ghost emps or vendors - fraud memos overstated - overstated commissions - unauth use of company resources credit cards etc - kickbacks schemes?

However some basic info:
1. Abnormal loss of stock can be due to theft, fire or other natural calamity and there may be three circumstances
Ø When stock is fully insured
Ø When stock is un-insured
Ø When stock is partially insured

Most important is how to record the same in the books of account. Two important points need consideration:

1. The loss of stock should be valued at cost and not at market price.

2. The closing stock should be valued at cost after the considering the loss i.e. the closing figure should be net of loss.

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