Divorce proceedings can be very complicated, and that can be especially true if the parties own businesses, artwork, or multiple properties. Many times it can be difficult to determine whether it is a marital asset, separate property, or some combination of both. This requires expertise in order to get a proper determination, and in most cases, the court will require an expert witness to testify on why they meet the specific classification.
Another big issue during divorce proceedings is proper valuation of the assets. Many assets that a couple owns could change greatly in value over time through different circumstances. Businesses and legal or medical partnerships can be difficult to value because of the complicated records that are involved. Other tangible assets, such as artwork, could require updated appraisals to obtain a current valuation.
During the valuation process, one of the parties may attempt to hide assets or falsify profit information for a business. A forensic accountant will search through all of the records to find out if any information seems to be missing or falsified. They will go back through records of previous years to determine patterns regarding income, profit and debt payments. If there seem to be recent inconsistencies in the data collected, especially around the time of the divorce, then the accountant can research it further and discover why this is so.
A forensic accountant can make a great addition to any divorce team, especially if large or complicated assets are involved. They can help with the negotiations for a settlement and can even testify as an expert witness if necessary. A lawyer may also be necessary, however, to assist a client in court proceedings and in filing paperwork necessary for the divorce.
Source: Forbes, “Why A Forensic Accountant Belongs On Your Divorce Team“, Jeff Landers, September 04, 2014