| A. |
There are two important related issues raised by this
question. The first is to know exactly what all of your assets are at the time of the
divorce. It is not uncommon for one spouse to be responsible for and to manage most or all
of the family’s finances. When you are faced with a divorce, you may not readily know
exactly what you own and where the money is. This is especially true if you and your
spouse have been married for many years, or if you have numerous accounts or properties. California law requires both spouses to provide complete disclosures
of all known assets and liabilities to the other spouse. Near the beginning of the case
your attorney will help you fill out two important documents: a Schedule of Assets and
Debts and an Income and Expense Declaration. Your spouse will be required to do the same.
These documents will provide you with information about all of your and your spouses’
property, whether separate or community. They will also show all income that your spouse
is receiving.
If you believe that your spouse may be secreting income or
assets, you should immediately share your concerns with your attorney. If your spouse is
not forthcoming with information about all assets and sources of income, you have the
right to seek additional information through discovery. Your attorney will discuss a
discovery plan with you, which may include interrogatories (questions that your spouse
will be required to answer under oath), requests for additional documents, subpoenas to
various financial institutions and perhaps a deposition of your spouse or other
individuals familiar with your family’s finances.
Disclosure laws are very strict and they require each
spouse to keep the other informed of all facts affecting the spouse’s finances, until
the time when all assets and liabilities are divided, either through settlement or at
trial. If one spouse tries to conceal assets or makes misrepresentations in his or her
disclosure documents, the court may impose strict sanctions.
Once all of the assets are accounted for, the next step is
to make sure they are divided appropriately. California is a community property state.
This means that all assets acquired during the marriage are presumed to be community
property, equally owned by both spouses. This is true even if one party is primarily
responsible for managing the assets or is operating a business. Even if the asset or a
business was started by one spouse before the marriage, the community and the other spouse
are likely to have an interest in that business.
Different types of property require different methods for
determining their value at the time of the divorce. Your attorney will work with you to
achieve an equitable division of your marital assets. If a small business, or shares of a
larger company, are involved, you may require assistance of a forensic accountant. These
are trained financial professionals, usually CPA’s, who specialize in investigating
and analyzing financial matters in divorce cases. A forensic accountant will assist you in
gathering information and ensuring that the assets are properly valued and divided between
the parties. A good forensic accountant can be instrumental in providing expertise and in
helping the parties reach a settlement once all necessary information is ascertained. |
