Why You Need A Forensic Accountant During Your Divorce
One of the most difficult and stressful parts of the divorce process is working out the financial settlement. It can be even more difficult if you believe your ex-spouse may be using financial trickery to skew the financial agreement in their favour.
When a crime is suspected, a detective will scour the scene for clues. A well-prepared divorce team will have its own detective to make sure everything is above board. They will investigate any suspicious activity. Introducing your forensic accountant.In this article, we’ll look at what a forensic accountant does and how they go about their work. We’ll also see how using a forensic accountant can provide reassurance at a difficult time in your life.A forensic accountant is a financial professional trained to spot financial discrepancies, which may be suspicious. In the divorce process, they are there to ensure that no parties use convoluted financial dealings to tip the balance in their favour when it comes to the financial settlement.
What does a forensic accountant do?
Forensic accountants are trained to spot inconsistencies on balance sheets and complex contracts. Experienced forensic accountants will know all the tricks people can play when they want to take more than they are entitled to. They can also testify in court if necessary.
What is a forensic accountant looking for?
While every divorce is slightly different, suspicions around money commonly arise for one of these two reasons:
- During the marriage, they had little understanding of the family finances. When it comes to divorce, they don’t have the detailed knowledge necessary to work out what a fair settlement would be. They suspect their ex-spouse may be keeping them in the dark to tip the balance in their favour.
- The party alleges their ex-spouse is using financial chicanery to understate their income or hide their assets, meaning they will not have to pay as much during the settlement.
A forensic accountant is there to attain transparency, to ensure all the information each party needs to make a fair financial settlement is on the table. If financial foul play is suspected, a forensic accountant is there to discover the truthful income, or to find those hidden assets. This is mainly done by scouring financial documents such as:
- Bank statements
- Business records
- Tax returns
What might a forensic accountant find?
People will go to extremely imaginative lengths when it comes to concealing money during a divorce. Here are some things a forensic accountant may be able to uncover.
- Parties omitting to mention non-cash-based assets during the divorce proceedings, such as bonds, shares or ISAs, with the plan to convert them into cash once the divorce has gone through.
- A party hiding money offshore, to avoid HMRC as well as their ex-spouse.
- Business owners hiding personal wealth in their company, or reporting lower revenues or debts, in order to understate their income.
- A party giving money to a trusted friend to look after, with a plan to retrieve it after the divorce process.
When might you need a forensic accountant
If you are going through divorce and you suspect your ex-partner of financial manipulation, or even if something just doesn’t ‘feel’ right, you should enlist the services of a forensic accountant. Even if they don’t find any evidence of foul play, it’s valuable peace of mind for you.If your ex-spouse is a business owner or involved in complex financial arrangements, it is worth asking a forensic accountant to check everything over. Again, even if they don’t find anything, it will put your mind at rest. If they do uncover something, it could lead to a fairer divorce settlement for you.