This article looks at the important roles played by forensic accountants and valuation experts in divorce.
A couple that has a large marital estate is, almost by definition, more likely to run into complex problems and challenges when they try to divide that estate during divorce. The complexity of many high-asset divorces means that there is often plenty of room for significant financial considerations to either be overlooked, misrepresented, or misunderstood. For these reasons, as Forbes points out, anybody going through a high-asset divorce should be prepared to seek the advice of financial experts, specifically valuation experts and forensic accountants, in order to protect their assets.
Why are financial experts important?
Dividing a marital estate is one of the most important parts of a divorce and, in the case of high-asset divorces, also one of the most difficult. In order for the estate to be divided fairly, both spouses and, in litigated cases, the court itself, must know what the estate is actually worth. If an estate is valued improperly or not all assets are accounted for then the final division of property will likely leave one spouse with far less than he or she deserves.
Valuation experts and forensic accountants are especially useful in cases where a spouse is suspected of having concealed assets. Because of their complex nature, high-asset divorces present more opportunities for assets to “disappear.” Uncovering these assets is rarely easy and a forensic accountant will need to be brought in so as to help uncover any wrongdoing. In some cases, assets may not be so much hidden as misrepresented. A former spouse, for example, may give a valuation of his or her small business that sounds suspiciously low. A valuation expert can help determine what the actual value of that business or other asset actually is so that the marital estate can be divided fairly.
Forensic accountants and valuation experts aren’t just important in cases where assets have been hidden or deliberately undervalued. In some cases assets simply get overlooked or they can be difficult for the layperson to accurately value. Life insurance policies, for example, may be worth a considerable sum, especially for high-worth couples, but without a forensic accountant to draw attention to these policies they may go overlooked. Likewise, as the Wall Street Journal notes, some items, like collectibles and artwork, may be impossible for spouses to attach a specific dollar figure to without the assistance of a valuation expert.
In a high-asset divorce a family law attorney is a necessity given the complex legal issues that are often raised in such cases. A good attorney should not only be able to provide excellent legal advice to high-net-worth clients, but they should also be able to put clients in touch with non-legal experts, such as forensic accountants and valuation experts, in order to ensure that a final divorce settlement is fair and equitable.