Forensic Accountants and Your Divorce Case
Divorce rates in the United States fluctuate between 40 and 50 percent, ranking it 6th amongst countries with the highest divorce rates in the world. In fact, it is estimated that there is a divorce every 13 seconds in America. When a marriage ends, the separating couple and all of those close to them are often caught up in the emotional aspects of the separation. However, the reality is that a divorce is the termination of a marriage contract and must be treated as such. Historically, there is nothing more difficult to determine than financial matters in divorce proceedings. As a result, many high asset divorce cases lean heavily on the expertise and investigative skills of an experienced forensic accountant.
Things like calculating child support or alimony often do not require the skillset of a forensic accountant. Their expertise and investigative services typically come into play when the financial analysis is far more complex, especially in scenarios where one or both of the spouses have sizable assets. Depending upon the details of the case, a forensic accountant is typically hired either directly (by one of the parties to the divorce) or by the attorney representing one of the spouses in the divorce. First and foremost, the court will require disclosures from both parties as to monthly expenses such as:
- Income
- Debts
- Assets
- Liabilities
- Taxes
- Food
- Medical Expenses
- Housing
- Household Maintenance
- Utilities
- Insurance
- Education
- Transportation
- and more
Following this disclosure, the forensic accountant will take a closer look at the financial records and possibly perform an audit. Investigating things like bank account information, credit card statements, assets, and even recent write-offs will begin to paint a telling financial picture. Looking further, the forensic accountant will then pull public records of things property deed transfer and look into financial statements if the spouse owns a business. All of these steps are taken in order to achieve complete financial transparency.
Unfortunately, hidden assets and hidden income are all too commonly utilized in order to attain an unfair advantage in a divorce case. From the use of offshore accounts to safe deposit boxes, there are countless ways for a spouse to hide assets in an attempt to avoid being subject to division during court proceedings. Forensic accountants employ a variety of methods to discover hidden assets. Combining accounting principles with auditing techniques as well as deep financial analysis, the ability to locate hidden income and hidden assets is a special and unique skill.
At Ellrich, Neal, Smith & Stohlman, P.A., our firm’s litigation services department provides professional services to participants in the legal process. These services include forensic accounting, fraud detection and prevention, assistance with discovery matters, consultation, and expert witness testimony. We provide litigation services in both federal and state courts in a wide variety of cases including brokerage fraud, shareholder disputes, class action litigation, personal injury, marital dissolution, contract claims, business damages, lost profits, business and contract disputes and criminal cases.
Our clients include both litigants and attorneys, and our services are provided both before the inception of and throughout the course of litigation. We are regularly retained in civil, criminal, and family law (divorce) matters, and often participate in the development of pleadings and in the discovery process. Contact our Palm Beach Gardens or Miami office today to learn more about your options.