When most people think of accountants, they picture someone crunching numbers at tax time or preparing spreadsheets for businesses. But there's a highly specialized area of accounting that plays a critical role in legal matters: forensic accounting. In particular, forensic accountants can be game-changers during divorce proceedings—especially in cases involving complex finances.
A forensic accountant is a financial professional who combines accounting expertise with investigative skills. They analyze financial records with the goal of uncovering discrepancies, fraud, or hidden assets. The term "forensic" means "suitable for use in a court of law," which is exactly where many forensic accountants end up—serving as expert witnesses.
These experts don’t just look at what the numbers say—they look at what the numbers mean in context, and whether they tell the full story.
Divorces can be emotionally and financially draining, and things can get especially complicated when one or both spouses own businesses, have multiple sources of income, or suspect the other of hiding money. This is where a forensic accountant steps in.
Here’s how they help:
It's not uncommon for one spouse to attempt to hide money, property, or investments during a divorce to avoid having to divide them. A forensic accountant can trace bank transfers, analyze financial statements, and look for signs of underreported income or undisclosed accounts.
If one or both spouses own a business, determining its true value is essential for fair asset division. Forensic accountants can evaluate the business's worth, factoring in revenue, expenses, debts, and market value.
For couples with irregular income (think entrepreneurs, consultants, or self-employed professionals), establishing a clear picture of earnings can be tricky. Forensic accountants can normalize income by reviewing tax returns, invoices, and other financial records to assess true earning capacity.
Not all assets are considered “marital property.” A forensic accountant can help determine what should be included in the marital estate and what was acquired before the marriage or through inheritance.
By reviewing credit card statements, bank transactions, and spending history, forensic accountants can help establish whether one spouse is spending marital funds irresponsibly or dissipating assets prior to the divorce.
Hiring a forensic accountant might seem like an added expense, but in many cases, their findings can lead to a significantly fairer financial settlement. Their work can:
In high-net-worth or contentious divorces, they can make the difference between a lopsided judgment and a fair division of assets.
Divorce is rarely easy, especially when money is involved. A forensic accountant provides clarity when financial matters become murky. Whether you’re concerned about hidden assets or just want to ensure an accurate picture of your joint finances, these professionals bring transparency, accuracy, and credibility to the table—sometimes quite literally, in the courtroom.
If you’re navigating a divorce and finances feel overwhelming or unclear, speaking to your Los Angeles divorce attorney about a forensic accountant might be one of the smartest moves you can make.
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