Divorce is an emotional event for those involved. Because the emotions are typically negative — anxiety, anger, and mistrust — it is common for one spouse to suspect the other is hiding or undervaluing significant assets in an attempt to keep them out of the divorce settlement. This suspicion often arises when a family owned business is at stake. In these cases, determining whether one spouse has hidden assets requires that a forensic accountant investigate the business’s financial records and documents. The forensic accountant then can understand the location of assets, track any significant changes in spending habits of either spouse prior to the date of separation, and look for patterns or breaks in patterns that may point to suspicious activity.
Know the Company
A key reason for understanding the location of assets is to help identify whether any have been removed. The first step in making this determination is to thoroughly understand the company. Knowing the company makes it easier to spot changes in business patterns — changes that might indicate whether assets have been shifted out of the business.