What is a Forensic CPA and How Can They Help With My Divorce?
A forensic certified public account (CPA) is an accountant with specialized accounting, investigative and audit skills who is retained in a divorce matter to analyze information and then present expert testimony regarding that information in court, if necessary.
Do you believe your spouse’s income or earning potential is greater than what he or she claims on the Domestic Relations Financial Affidavit? Are you unsure how you will be able to prove you spouse’s income or assets for the purpose of equitable division, child support and alimony? Did you or your spouse have separate property or pre-marital assets that have since been comingled with marital assets? Do you or your spouse own a closely held business that is hard to value? If you answered one or all of these questions with a yes, then you should consider consulting a forensic CPA to assist with your divorce process.
However, before you do so, it is essential that you seek the advice of an Atlanta divorce attorney first to determine whether a forensic CPA may be appropriate in your divorce and to understand what services they offer.
Many divorces require the division of closely held small businesses, whose primary shareholders are the parties to the divorce. For some families, the business is the largest asset of the marriage. Since the business may be a marital asset and primarily the product of the couple’s labor, the valuation of these businesses can serve as one of the major stumbling blocks in the negotiation process. A forensic CPA can provide an expert opinion as to the fair market value of that business that can be used in settlement negotiations, mediation or even court.
Unless you are a CPA yourself, understanding the path of assets and how this equates to their present value is an analysis best left to a professional. Perhaps there are mutual funds that have been cashed out and transferred to a low-interest CD, or real estate sale proceeds that have flowed into stock purchases. Maybe you had a retirement plan that you contributed to before your marriage and after your marriage. Sometimes these transactions comingle separate or pre-marital assets with marital assets. Understanding how the asset transfers calculate and what constitutes an equitable division of those assets can spin heads.
Luckily, experienced CPAs in conjunction with your divorce attorney can analyze the timeline of these transfers and illustrate to you, the other party and the court, how this asset tracing ultimately equates to marital dollars and cents.
Gauging Child Support
There are many factors that need to be considered when properly calculating child support in Georgia. A forensic CPA will be able to articulate each factor and how it may contribute to a final child support figure. In calculating child support, Georgia law defines “income” as all “income from any source, before deductions for taxes and other deductions….” A proper income calculation could also include an analysis of “under the table” earnings or improper financial transfers if evidence exists that one party is attempting to hide income.
A forensic CPA can ultimately find all income that each party has earned by reviewing bank records, tax returns, credit card statements, and other financial documents. This tracking will reveal each party’s total financial picture, which will simplify the child support calculation process.
Analyzing Financial Records To Educate And Advise
Beyond providing analysis for specific aspects of a divorce proceeding, a forensic CPA can also provide an overall analysis of each party’s financial status. This review can reveal significant inconsistencies in financial representations made during the divorce litigation. Reviewing tax returns, accounting records, and personal financial statements may uncover more of the financial picture. This work will educate both you and the family court judge in what should be considered as an equitable division of the financial assets, as well as what the proper child support calculation should be and whether alimony is appropriate in your matter.
Forensic CPAs – A Path To Financial Security and Efficiency
Only through a complete and accurate financial picture of a divorcing couple’s assets, can true justice be rendered. Although there is a fear that forensic CPAs may cost too much in a divorce action, the efficiency in which information is gathered and analyzed can ensure that you reach maximum productivity. This can ultimately result in further financial and emotional savings to you as you move through the divorce and into the next chapter of your life.
Your divorce settlement agreement or judgment is one of the biggest financial decisions in your life. The outcome of your divorce can dramatically change your financial situation. The Atlanta divorce attorneys at Buckhead Family Law will work with you to try and guide you through what can be a complex process. Call us today at 404-600-1403 to schedule a consultation.