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Surviving Business Interruptions: What Do You Do Now? Part 4

20/03/2018


Checking the Final Boxes

When a business interruption happens – whether it’s caused by an environmental issue or say, a burst pipe – there are steps you can take and advisors you can turn to, to help prevent further losses and get your business back up and operating.

In our series on surviving businesses interruptions, we’ve covered the critical first steps to take in making a claim and documenting evidence and backing up business records, we’ve talked about how losses are calculated and when you can pay your employees. In our last article, we shared insights into what the interruption can mean for future planning​.

To complete our series, we’ve compiled a list of what the next steps to take to get your business back on track.

What Information Will You Need to Gather?

Identify and collect relevant documentation to prepare and support a claim as you go along. Use a binder or set aside a box electronic storage median for all information related to actions taken and money spent related to getting the business back to normal.

  • Keep all receipts for expenses incurred as a result of the incident, including temporary business premises, equipment rented or purchased in order to continue business, additional fuel costs, cleanup costs and damage repair costs.
  • Monthly profit and loss statements for at least two years prior to and year to date since the incident will need to be considered as part of a Business Interruption claim
  • Annual financial statements for three years prior to incident may be required.
  • Any budgets or forecasts that might have been prepared covering the period after the incident (for example information you might have provided to the bank)
  • Payroll records for ordinary and key employees.

Depending on the nature of loss, the following information may also be needed:

  • Inventory records
  • Production records
  • Sales transaction history and other records/supporting documents
  • Bank statements

The following information may also be helpful to the insurance company:

  • A detailed description of the business, how it generates cash, what its key success variables, main products / services and ancillary products and services.
  • Details about how the incident impacted the business.
  • Details of any stages of getting back to normal including partially operating and when it returned to pre-incident condition.

If you are unsure what to do next, contact your local MNP Valuation, Forensic and Litigation Support specialists. We are always ready to help you through any interruptions in your business.

Nadine Wightman, CPA, CA, CBV, CFF, is a Partner with MNP’s Valuation and Litigation Support group in Saskatoon. For more information on business interruptions, contact her at 306.664.8381 or [email protected].