2. Insurance Settlement Proceeds

Beverly has a warehouse and sales office in the Gulf Coast Region. The damage caused by Hurricane William (Hurricane), a Category 5 hurricane, has rendered the warehouse inoperable and has also forced the company to rent temporary office space in Houston to accommodate its sales force. Beverly reached a settlement with its insurance carrier related to the damage from the hurricane and received proceeds of $15 million from its insurance carrier in connection with its claim for reimbursement. Beverly plans to use the insurance proceeds to fund its defined-benefit pension plan, rather than to rebuild the destroyed facility.

ASC 230, Statement of Cash Flows (Statement of Cash Flows).

Required: a. Determine the appropriate cash flow statement treatment classification (e.g., operating, investing, financing) for the above transactions.

b. What international accounting standard (IFRSs) applies to cash flow statement presentation? In general, how do those guidelines compare to U.S. GAAP in these particular situations?