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The Role of Forensic Accountants in Equitable Distribution Cases

Posted on by Jean Mahserjian
In family law, equitable distribution cases involve dividing property and assets fairly between spouses. However, determining a fair split is not always simple, especially when dealing with finances. Forensic accountants play an important role in these cases, using their knowledge to dig into financial records and make sense of complex assets. In divorce cases, their work helps uncover hidden income, value businesses, and provide a clear financial picture, making it possible to reach a fair decision on how assets are shared. This page explains how forensic accountants help in equitable distribution cases and the valuable support they provide to families and attorneys. At, Mahserjian & Mahserjian-Ortiz, PLLC , we are here to guide you through the legal process and help you navigate the complexities of your case.

What Is Equitable Distribution?

Equitable distribution refers to the fair division of marital property and assets when a marriage ends. In states like New York, this process does not always mean splitting everything equally, but rather dividing things in a way that is fair to both parties. Courts look at various factors to decide what fair means, such as the length of the marriage, each spouse’s contribution, and the future financial needs of each person. This process can become very complicated if one or both spouses own businesses, have investments, or earn income from multiple sources. Forensic accountants help make the process smoother by finding accurate information about assets, income, and debts, which can be difficult to track down without the right experience.

How Forensic Accountants Assist in Identifying Assets

In equitable distribution cases, finding all marital assets is one of the first steps. Some assets are easy to find, such as a family home or shared bank accounts. However, other assets might be hidden, intentionally or accidentally, in business accounts, investment portfolios, or retirement funds. Forensic accountants use financial investigation techniques to locate assets that might be overlooked. They review bank statements, tax returns, business records, and even online transactions to ensure all assets are identified. This work ensures that both spouses know exactly what is available to be divided, leading to a fairer outcome in the divorce.

Uncovering Hidden Income and Assets

Hidden income or assets can be a big issue in divorce cases. Some individuals might attempt to hide their true financial situation by not reporting certain income sources or by transferring funds to hidden accounts. Forensic accountants are skilled at identifying signs of hidden income. They carefully look through records, check for unusual transfers, and compare income statements with expenses. If there is any suspicious activity, forensic accountants bring it to light, ensuring that both spouses have a clear understanding of the total income. This level of transparency helps make sure the division of assets is fair and that one spouse is not unfairly disadvantaged.
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Valuing Businesses and Complex Assets

Business ownership brings unique challenges to equitable distribution cases. If one spouse owns a business, deciding how to value that business becomes a critical part of the process. Forensic accountants use different methods to value businesses, considering factors like income, market conditions, assets, and debts. They might examine financial records going back several years to determine the business’s worth accurately. If a business generates significant income, knowing its value can make a major difference in the division of marital assets. Besides businesses, complex assets such as investments, stock options, and retirement accounts also require detailed valuation. Forensic accountants ensure that each asset’s value is accurately represented, so both parties understand its worth and can make informed decisions.

Calculating Marital and Separate Property

Not all property is subject to division in a divorce. In equitable distribution cases, the court must determine which assets are considered marital property and which are separate. Marital property includes assets and income acquired during the marriage, while separate property usually includes things like gifts, inheritances, and property owned before the marriage. Forensic accountants help clarify these distinctions by analyzing financial records and tracing the history of each asset. This step prevents disputes over ownership and ensures that only marital property is included in the division. With the accountant’s analysis, both spouses can have peace of mind knowing their separate property will remain protected while marital property is fairly divided.

Examining Debts and Liabilities

Equitable distribution includes not only dividing assets but also handling debts. In many cases, marital debt needs to be divided just as assets do. Forensic accountants examine all debts and liabilities to determine which are marital and which are separate. They look at credit card statements, loan documents, and other financial records to clarify how much debt was acquired during the marriage. This process helps prevent any misunderstandings or unfair burden on one spouse. The accountant’s work ensures that both parties leave the marriage with a fair share of both assets and debts, setting each person up for a stable financial future.

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Supporting Attorneys in Legal Proceedings

Forensic accountants do more than just gather numbers; they often work closely with attorneys during divorce proceedings. In equitable distribution cases, attorneys rely on the forensic accountant’s findings to build a clear picture of the couple’s finances. The accountant might prepare reports that are presented in court, showing evidence of assets, income, and debts. In some cases, forensic accountants may also testify in court, explaining their findings and answering questions about financial issues. Their presence can make a significant difference in complex divorce cases, helping the court understand the financial details and supporting the attorney’s arguments for fair asset division.

Providing Financial Clarity and Transparency

In divorce cases, financial uncertainty can add stress and tension. Forensic accountants bring clarity and transparency to the process, giving both parties a clear view of the financial situation. Their work prevents misunderstandings and reduces the chances of disputes arising from hidden assets or debts. By offering a straightforward look at each spouse’s finances, forensic accountants help both sides feel more comfortable with the final outcome. Knowing that every asset and debt has been accounted for allows both spouses to move forward confidently and with a sense of fairness.

Ensuring Fairness and Accuracy in Asset Distribution

Fairness and accuracy are two key goals in equitable distribution cases. Forensic accountants play an important role in achieving these goals by ensuring that each party receives their fair share of the marital assets. They use their financial knowledge to confirm the true value of assets, uncover any hidden income, and provide a complete financial picture. With their assistance, both spouses can have confidence that the division of assets is based on accurate information. This level of fairness is essential for closing this chapter of their lives on equal terms and building a foundation for their future.

Working with Forensic Accountants in Equitable Distribution Cases

Working with a forensic accountant in an equitable distribution case offers many benefits. Their involvement brings a sense of trust and confidence to the process, knowing that every financial detail is carefully examined. Forensic accountants handle the complex and often overwhelming task of sorting through financial records, allowing spouses to focus on other aspects of the divorce. Their reports and testimony in court can also provide a strong foundation for the attorney’s arguments, increasing the chances of a fair outcome. Choosing to work with a forensic accountant can make the entire divorce process smoother, reducing the likelihood of surprises and ensuring that each spouse leaves the marriage with what they are entitled to receive.

The Importance of Forensic Accountants in High-Asset Divorces

High-asset divorces often present more challenges due to the complexity of the assets involved. When a marriage includes significant investments, multiple properties, or business interests, determining each party’s fair share can be incredibly complex. Forensic accountants bring a level of accuracy and assurance to high-asset cases that are essential for equitable distribution. They dig deep into financial records, verify asset values, and ensure that every detail is covered. This work is vital for maintaining fairness, particularly when one spouse may have a more intricate financial portfolio. With the support of a forensic accountant, even the most complex high-asset divorce cases can reach a fair resolution, allowing each spouse to move forward confidently. For equitable distribution cases involving complex financial matters, having a clear and fair understanding of finances is essential. Forensic accountants bring valuable knowledge to this process, making sure all assets are accurately identified, valued, and divided in a way that is fair to both spouses. Their work not only helps create transparency but also provides support in court proceedings, offering clarity that can make a significant difference in the outcome of your case. At Mahserjian & Mahserjian-Ortiz, PLLC, we understand the importance of accurate financial information in equitable distribution cases and are committed to helping our clients navigate these complex situations. With our experience and dedication, we work alongside forensic accountants to ensure that every financial detail is accounted for, supporting you in achieving a fair and just resolution. Contact Mahserjian & Mahserjian-Ortiz, PLLC today to discuss how we can assist you in your equitable distribution case and provide the support you need to move forward.
Jean Mahserjian