In complicated divorces, even amicable splits can produce difficult financial scenarios. However, if your divorce isn't amicable and your spouse provides bogus or incomplete financial information, then a forensic accountant is a must-have member of your divorce team.
In a high-asset divorce, a forensic accountant can help uncover financial inconsistencies, reveal hidden assets, appraise property and assets, account for art and antiques and make sure all distribution is equitable.
Equitable distribution in New Jersey
New Jersey is an "equitable distribution" state, meaning that division of marital property in a divorce must be fair but not necessarily equal. To reach an equitable distribution, you must have an accurate account of property, stock options, benefits, investments, savings, shares and life insurance policies, among any other items of value.
This can be complicated enough, but when one spouse provides incomplete or falsified documents to the other, discovering a person's true net worth is very difficult.
Experts say that forensic accountants can help detect unethical practices such as underreporting income, padding payroll, creating fake debt, transferring assets and overpaying creditors. By uncovering this information, the accountants can determine your spouse's true income so your lawyer can accurately negotiate your settlement.
Forensic accountants are typically Certified Public Accountants who have specialized skills that go beyond the services provided by a divorce attorney. They have the knowledge to search not only the records provided by your spouse but also public records such as property deeds (in case your spouse transferred property to a family member to hide it from you) and the Secretary of State's office (which may retain business documents for as many as five years).
An eye on the language
While a forensic accountant can find the money, there are attorneys who specialize in difficult divorces. The wording used in a divorce decree can have vast financial implications years from now. Although it may mean adding another professional to your team, the payoff could be immense.