In January 2015, I established a startup in the Middle East after successfully raising seed funds. Unfortunately, 4 months in the office was blown by a bomb due to a sudden civil war; I didn't have insurance. I have applied to get investment from some VCs to recover the startup and they've asked for the business plan as expected. My question is: What's the right way to mention the loss in cash (due to the crisis) in the business plan? Do I need to attach a special report explaining it or I can just mention it in the cash flow or profit-loss report? Under which category of expenses do I need to list the details of lost cash?
Usually it comes as "extraordinary events", which it would be a specific line apart in the P&L and would necessary have a note to explain the whole situation and how it won't happen again, and what are you doing to mitigate those risks (this is kind of from an accounting perspective and so you can also explain this line item won't show up again -hopefully- in your balance sheet)
Answered 5 years ago