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Financial Discovery in Family Law : What you should really know

Posted by attorney Athina Karamanlis Powers

The biggest and most important part of a divorce procedure (second to child support and custody) is the financial discovery. Many lawyers see that part as the “garlic that keeps the vampire away"; they either don't want to take on a case like that or they don't want to spend the money for the research and investigation, primarily because they cannot judge the work of an accountant. There are many computer programs nowadays that can help you avoid that problem. However, in my personal experience, I believe that it's difficult, if not impossible, to help your clients with such cases if you don't know the basics of accounting.

Family law is another beast you need to tame if you want the best results for your client, not only as a lawyer but also as someone that understands 'economics'. Forensic accounting doesn't revolve solely around numbers but also provides text about those numbers. Do you want to be responsible if those numbers are non-beneficial to your client? In situations such as these, it's important to have someone that's not only an attorney but an individual that helps and protects you against such financial bumps. Seriously speaking, how many lawyers out there know accounting and what an accounting firm must provide you with? Numbers are not the only thing that an expert must give you. Other information includes:

1) The valuation of business interests

2) The valuation time that spouses spend to the business or at home raising kids and having a home office

3) Whether or not a stipulate date of the valuation took place

4) The measure of value and the methodology that was used

5) The replacement value of the Owner's Services (market value of the services that spouses contributed to the business during marriage).

6) How the income of each party was determined

7) The self-employment, healthcare benefits

8) Calculations of the cost of living

9) Tax returns in your possession that were used in your evaluation

10) Methods of Tracing of commingled funds

I've seen cases lost because lawyers don’t want to or refuse to put themselves in that number-and-statistics "modus operandi". Let me direct your attention to the articles published in Forbes magazine about how husbands typically hide their assets. As I've mentioned before, the players change but the game stays the same.

We need to develop a new perspective to better assist our clients. The answer does not only lie with experts in law and accounting, but also with experts in fraud and financial evasive techniques.

Copyright Karamanlis Powers Law Offices. Where Experience is Priceless

Athina K. Powers . Attorney and Fraud Examiner (CFE)

editing Moga Publications

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Athina K. Powers, Attorney and Fraud Examiner

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