106 Humphries Co has three warehouses; following extensive rain on 20 November, rain and river water flooded the warehouse located in Bass. All of the inventory in the warehouse was damaged and has been disposed of. The insurance company has been contacted. No amendments or disclosures have been made in the financial statements. Which of the following statements correctly describe the likely impact this will have on Humphries’ financial statements for the year ended 30 September 20X1? (1) Inventory should be written down, because the flood damage is an adjusting event (2) Inventory should not be written down, because the damage is not an adjusting event (3) If a material amount of inventory is uninsured, it may be necessary to disclose the event and an estimate of the financial losses (4) If insurance proceeds are more likely than not to be received, a contingent asset should be recognised