Why You Need A Forensic Accountant For Your Divorce And Financial Settlement
Forensic accounting can play an integral part in divorce and financial settlements. It can assist with fraud investigations and information analysis ready for legal proceedings.
Find out why you should consider a forensic accountant, and if you really need one.
What can a forensic accountant do for my divorce proceedings?
While divorce is often an emotionally trying experience, at its core, it’s a matter of ending a contract between two parties. One of the most contentious aspects of divorce involves financial matters. In some cases, attorneys or private parties hire forensic accountants to uncover assets and to provide an expert testimony at their divorce hearing.
Financial settlements during a divorce
Financial disputes are very common during divorce proceedings. This could be because one of the spouses was the money manager during the marriage, resulting in the other spouse being disadvantaged in terms of knowledge of the couple’s assets and financial health. The money manager may use this knowledge to secure a favourable settlement, but this is where a forensic accountant can help.
Another financial issue that may occur during the divorce is the higher-earning spouse attempting to understate income in order to reduce child or spousal support payments. Spouses may also try to hide assets so that they will not be subject to division during the divorce. A forensic accountant can also help with this kind of scenario.
Assets are often hidden from spouses during a divorce
Many assets are often hidden during a divorce and are often converted into cash after the divorce settlement is agreed. Common types of hidden assets include:
- Mutual funds
- Insurance Policies
- Stock and annuities
Assets are concealed in many ways. While there are many high profile cases of offshore accounts, a more common scenario is an individual giving their assets to a close family member or friend. Someone trusted and safe who will temporarily store their assets. Perhaps an individual will claim they owed a family member money before the divorce, only to claim it after.
Forensic accountants can locate hidden assets during a divorce
A crucial role of a forensic accountant is to locate these hidden assets. This is key for divorcees who want to ensure they are getting what they are entitled to upon their divorce, and don’t want to open the case at a later date.
A forensic accountant can use a number of methods to do this, including:
- Asking about a spouse’s habits, this way they can determine a potential location where assets might be.
- Reviewing tax returns. A forensic accountant can even request a copy of these from the HMRC.
- Analysing financial account statements, such as savings accounts, checking accounts and money market funds.
- Closely observing business transactions for those who are business owners and will analyse if there have been any recent write-offs.
Ultimately, a forensic accountant in a divorce case will use their knowledge of accounting principles, auditing techniques, and financial analysis to uncover hidden assets and income.
Forensic accountants in Manchester
Our specialist team of forensic accountants in Manchester are experienced with many divorce and financial settlement cases. Not only have they been supporting divorcees in Manchester and the North West, but they also have experience with similar cases throughout the UK.
If you think your case could benefit from a forensic accountant, contact our team today on 0161 832 4841. Alternatively, you can fill in our online contact form and one of our forensic accountants will be in touch promptly.