What is Business Interruption?

Business Interruption refers to the financial losses sustained by a business when its operations are unexpectedly halted or disrupted due to unforeseen events beyond its control. Typical causes include natural disasters, property damage, cyber incidents, supply chain failures, or other external factors that negatively impact trading activities. Such interruptions result in lost revenue, ongoing fixed costs, and additional expenses necessary to mitigate the disruption and restore normal operations.

While Business Interruption insurance is intended to indemnify these losses, the calculation of an accurate claim requires detailed financial analysis and careful assessment of the business’s trading and cost structure during the affected period.

How I Can Assist in Quantifying Your Business Interruption Claim

As an experienced forensic accountant specialising in business interruption, I provide expert financial analysis to assist clients in precisely quantifying their loss.

Loss Quantification Services Include:

  • Comprehensive Financial Analysis: I examine your accounting records, management reports, and other financial documents to assess the true impact on revenue and costs directly attributable to the interruption.

  • Assessment of Lost Revenue: Calculation of income foregone during the interruption period, adjusted for normal business fluctuations, seasonal variations, and market conditions.

  • Calculation of Continuing Fixed Costs: Verification of ongoing expenses such as rent, salaries, and utilities which must be paid despite the halt in trading.

  • Identification of Additional Expenses: Quantification of any reasonable and necessary extra costs incurred to mitigate losses or hasten business recovery, such as temporary relocation or hiring additional labour.

  • Business Trend and Recovery Period Analysis: Careful study of historic trading trends and projected recovery timelines to determine the precise duration over which losses should be claimed.

  • Supply Chain and Indirect Impact Evaluation: Consideration of losses stemming from dependencies on third parties, ensuring a comprehensive capture of the financial effect.

  • Tailored Methodology Application: Utilisation of industry-recognised loss quantification methods (e.g., Net Income or Gross Profit approach) selected based on your business model and policy requirements.

Why Engage a Specialist Forensic Accountant?

Business interruption loss calculation is a highly technical exercise requiring specialist financial knowledge and analytical rigour. Engaging a forensic accountant ensures an accurate, robust quantification of loss which stands up to scrutiny from insurers and other stakeholders.

My services provide:

  • Impartial, expert financial assessment;

  • Detailed loss calculation supported by transparent methodology and auditable workpapers;

  • Clear communication of complex financial analyses in formal reports suitable for claim submission or expert opinion.

If your business has suffered an interruption and you require an authoritative and precise quantification of your financial losses, please contact me to discuss how I can support you with expert forensic accounting services.