When representations made by an opposing spouse appear questionable, a CPA/CVA/CFE may be engaged to test the financial representations by performing forensic procedures. For example, a family incurs annual living expenses of $90,000 and the earner spouse claims to make only $40,000 per year. If one spouse makes a representation that is challenged by the opposition, a CPA/CVA/CFE may be requested to perform certain forensic procedures. These forensic engagements may be add-ons to an existing divorce-related engagement or they may be stand-alone engagements. In either case, the CPA/CVA/CFE will perform forensic procedures of financial data as required under the particular circumstances. This situation can be greatly enhanced if the attorney has done a thorough job in the discovery process.
Forensic procedures require a good deal of information. If the attorney (representing the spouse that is requesting forensic procedures) has not done a thorough job in the initial discovery phase, the cost of performing forensic procedures will be greatly increased. At the same time, the benefits of the forensic procedures may be lessened. This is why it is extremely important for the attorney to enhance the financial discovery process at the very beginning of a case. A CPA/CVA/CFE engaged to assist in the initial discovery phase will generally provide benefits beyond the cost.
Should you need business valuation assistance or have questions, please call one of our credentialed professionals at (615) 822-8342 or contact us via email.