The work of a forensic accountant is critical when valuing and dividing property in a complex divorce. A forensic accountant analyzes documents to help the court decide on child and spousal support payments, as well as how to divide community property.
A forensic accountant analyzes documents to help the court decide on child and spousal support payments, as well as how to divide community property.
Forensic accounting professionals work with a client’s family law attorneys and utilize standard accounting practices in a legal case.
Tax returns, bank records, contracts, and other financial documents are assessed by a forensic accountant. In a divorce case, the accountant aims to reveal a spouse’s financial information to ensure property valuation and division in the case are fairly split.
The forensic accountant digs deeper to look for hidden assets and inconsistencies between claims and financial records. The multi-faceted role of the accountant ultimately depends on the case’s needs and its direction, and decided by the client and divorce attorney.
Hidden Assets and Inconsistencies
The forensic accountant looks closely at documents to determine their accuracy and corroboration records with certain financial claims. The accountant also verifies all assets and income are prepared and on record.
It’s not uncommon for a spouse to forget or deny certain assets, such as in the discovery of an extra-marital affair. Whether it’s forgetfulness and ill-will, the accountant has resources to search for off-shore accounts and other hidden property.
Assist in the Discover Process
Discovery is the process of information gathering, and is when a forensic accountant is crucial to your divorce case. The accountant will work with your attorney to make sure all the right documents and information are gathered through motions and subpoenas. Additionally, the forensic accountant may provide input that helps your attorney prepare the Interrogatories to your spouse. Interrogatories are written questions that reveal information and aid in preparation for deposition and trial.
A forensic accountant has the tools and knowledge to do the following:
- Value businesses and professional practices for clients such as doctors, lawyers, accountants, and other professionals
- Trace property to determine what is community and separate property
- Separate business expenses versus personal expenses to ensure the business is valued accurately
- Determine monthly cash flow
A forensic accountant hired for your case is also available to testify in a deposition or in court. If your case doesn’t go to trial, than the accountant can provide input on tax implications that may result from dividing marital property.