FAMILY LAW ARTICLES
A forensic accountant is someone who specializes in investigating potential financial misconduct. They will often give opinions and testimony in family law proceedings where one spouse is suspected of hiding assets in a divorce. However, they can also serve in other roles, even when fraud is not questioned—such as valuing a family business.
Here, we run through a few ways that a forensic accountant might be used in a family law proceeding.
You and your soon-to-be ex-spouse can share a forensic accounting expert in some cases. Instead of working just one side, the expert can work for both members of the couple to examine all of the finances involved in the case. This type of role is more common when one or both members of the couple owns their own business.
A joint expert is appointed under Evidence Code Section 730. Under this type of appointment, the expert has no duty or loyalty to either party individually. Instead, their duties are specifically to the court. They are considered a neutral expert that will assist as part of a settlement conference or at trial.
A joint expert can be beneficial to allow the parties to view and understand the valuation of a business. They will often assist the parties in developing a mutually agreed property distribution based on the valuation that they provided.
In many cases, the business involved will pay for the costs of the joint expert. Otherwise, the bill may need to be split between the parties.
Rebuttal Experts: An Expert to Challenge the Joint Expert
In some cases, a 730 expert may be appointed, but you or the other spouse does not like the final opinion that the expert provided. In those situations, you may be able to hire your forensic accountant to review the 730 expert views and develop a different statement about the business valuation.
There are situations where one party’s expert will also work with the 730 experts to address discrepancies or disagreements regarding their reports. If they can resolve, the 730 experts may adjust the information they provide to the court to reflect an agreement with the independent expert.
Costs can be tricky when using rebuttal experts. If the case proceeds to trial, for example, the expert must often spend a great deal of time preparing for their testimony. That time can be expensive because experts will charge by the hour. It would be best if you walked through a careful cost-benefit analysis with your family law attorney about whether involving an expert is necessary.
Independent Experts: Each Party Uses Their Own Expert
You can also forgo using a joint expert altogether. In those cases, each party will hire its own expert instead of involving a 730 expert.
In some situations, one accounting professional may have been assisting one party for years. That person could have helped that spouse prepare for the divorce, or perhaps they are just generally aware of the books and records associated with a business.
Using a forensic accounting expert properly can have a considerable impact on your divorce proceeding. The team at Hartley Lamas Et Al. can help you work through when and how experts should be used. Contact us today for more information or to schedule a consultation.