Forensic accounting combines accounting, auditing, and investigation skills and uses those tools to examine fiscal issues. Oftentimes, forensic accountants act as valuable experts in all sorts of legal proceedings (i.e. civil, criminal, and family law cases, and they are hired to review financial documents to help strengthen either side’s case or uncover a crime.
Why You Might Need a Forensic Accountant for Your Divorce
Under California law, forensic accountants can act as expert witnesses during your divorce proceedings and can testify regarding their findings. Their testimony can be compelling evidence in supporting your claims concerning alimony, the division of property, child support, and any number of divorce-related matters.
During your divorce proceedings, you may retain the services of a forensic accountant for help:
- Uncovering hidden assets. Even though both parties have a fiduciary duty to completely disclose their assets and debts, some people attempt to hide assets. If you suspect your spouse is concealing their assets or falsifying financial information in their disclosure, a forensic accountant can investigate and try to uncover the assets.
- Conducting a business valuation. If either party owns a business (or any other valuable assets), a forensic accountant can conduct a valuation, which is important for the property division settlement. California is a community property state, so if the business is a marital asset or a commingled asset, it is subject to division. Either party may have to buy out the other party, or the business may be sold in order for the profit to be split; in either case, it is important to have a clear idea of the business (or assets) worth.
- Advising you of potential liabilities. A forensic accountant can advise you regarding the future financial implications (such as tax implications) of decisions and determinations made in your divorce case.
- Calculating either party’s income. You need to know each party’s gross income (from their job and alternate streams of income) to calculate child support and alimony payments. If you or your partner are a business, your business and personal accountants may be intermingled, which can make determining your income complicated. A forensic accountant can review financial documents (i.e. W-2s, payrolls, expenses paid to and from business or personal accountants, etc.) to accurately determine either party’s income.
- Conducting a lifestyle or marital spending analysis. In calculating alimony payments, the court will consider a variety of factors, including each spouse’s financial needs with consideration to the marital standard of living. A forensic accountant can conduct an analysis of how each party is used to living based on their income, spending habits, etc. to help clearly define the standard of living that you are accustomed to.
- Drafting a list of your marital assets or liability. To help streamline the division of property, a forensic accountant may be asked to compile a marital balance sheet, which is a complete list of a couple’s marital assets that includes their value.
- Investigating wasteful dissipation claims. If either party accuses the other party of wasteful dissipation of marital assets, a forensic accountant can investigate the validity of the claim and determine the value of the marital assets dissipated. The wasteful dissipation of assets can include gambling, overspending on alcohol, drugs, or partying, using marital assets on an extramarital affair, spending frivolously, and failing to protect assets.
- Helping with case preparations. A forensic accountant can work with our legal team and review any financial documents submitted by the other side (noting any potential rebuttals). They can also help attorneys draft questions and develop a strategy regarding challenging the opposing counsel’s expert’s testimony.
Consult with Our Attorneys
Retaining an experienced, reliable attorney is important for the success of your divorce case. At The Neshanian Law Firm, Inc, our attorneys have over 20 years of combined experience, and we can help you connect with other experts who can help you with your divorce case, including a forensic accountant.
Contact us today to schedule your free consultation. Call (949) 577-7935 or reach out online.