People generally realize that they require the assistance of professionals during the divorce process. Spouses typically require individual representation from experienced family law attorneys. Sometimes they may bring in additional support from professionals such as mediators.
More complex divorce cases may require the support of additional professionals. Those preparing for high-asset divorces, especially in cases with higher levels of conflict, may require help from professionals during the property division process. Specifically, forensic accountants may play an important role in helping people prepare for an upcoming divorce.
What does a forensic accountant do, and why do people hire them during divorce proceedings?
Forensic accountants review financial records
The longer a couple remained married and the more assets they shared together, the more documents there are to review to understand the financial state of the marriage. People can easily overlook signs of inappropriate spending of hidden income if they attempt to review all financial disclosures on their own behalf.
A forensic accountant specializes in identifying signs of financial misconduct and tracking how people use their resources. A forensic accountant can identify warning signs that one spouse may have diverted funds from their paycheck to a hidden bank account.
They can analyze how people paid for different resources to determine whether they are separate property or marital property. They can help identify and quantify dissipation, including wasteful spending, the destruction of marital assets or the use of marital resources to conduct an extramarital affair. They can go over income statements, tax returns and credit card invoices to track the use of marital income. In some cases, they may uncover proof of financial misconduct.
In marriages where there is more property to address or in cases where the spouses experience a high level of conflict, the risk of financial misconduct is higher than it might be for other divorcing couples. In such scenarios, forensic accountants could be an important addition to a concerned spouse’s divorce support team.
Those who worry about the possibility of financial misrepresentation, hidden assets or dissipation affecting property division proceedings may want the help of a forensic account. There’s real value in the confidence that comes from a thorough financial review before agreeing to any economic terms.