This Industry Alert discusses key accounting, disclosure, and internal control related matters that pharmaceutical and medical technology companies may encounter in dealing with the financial reporting implications of Hurricane Maria. In order to minimize supply disruption, companies have implemented contingency plans to move inventory out of Puerto Rico, shift production to other FDA compliant manufacturing sites, and/or realign inventory within their distribution network.
For additional information on the financial reporting implications of natural disasters, refer to PwC's In depth: Accounting and disclosure implications of Hurricanes Harvey and Irma.
In connection with a company’s upcoming interim and annual reports, disclosures may be necessary regarding the effects of Hurricane Maria. Footnote disclosures may be necessary for losses incurred, insurance claims made and expected insurance recoveries.
Accounting considerations as a result of Hurricane Maria include, but are not limited to: