| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
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| #7411 | Closed | public | Multifamily | Les Sparks |
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A client that owns a HUD insured 221(d)(4) Apartment complex incurred damages from a Hurricane. Insurance proceeds are over $5 million dollars. The damages are $5 million. In HUD’s chart of accounts (Appendix A) there is no account listing for loss or damages from hurricane or other natural disasters. Where do I record the $5 million dollar hurricane damages? I believe I should record the insurance proceeds “5193 Special Clams Revenue. Where does the $5 million damages get recorded? 6590-010 Miscellaneous Operating and Maintenance Expenses? |
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From Les Sparks: There is no real place for the recording of insurance proceeds and/or the unusual expenses. People do treat these things differently. Some net insurance proceeds against the insurance revenue. Some record them differently by booking expenses in account 6590 – Other Repairs and Maintenance. Insurance proceeds are recorded in account 5990 other revenue. Either way would be accepted by REAC. There are not specific accounts for doing this. Account 5193 is not for this. That account is simply for the special claims from the Section 8 program. |