[PDF] - 6/4/2012 THE ROLE OF THE FORENSIC ACCOUNTANT Very F Few w PDF Document

SLIDE 1

6/4/2012 1

THE ROLE OF THE FORENSIC ACCOUNTANT

Very F Few w Friendly La Lawsuit wsuits Ba Battle les Ov Over er:

Division of Marital Property
Child Custody
Support Obligations

St Stor

ries:
Bitterness
Sneakiness
Vindictiveness
Hatefulness
Etc.

DIVORCE FORENSIC ACCOUNTING “UNIQUE”

Seek Seeks t to Un Uncover Beh Behavior: De Devi vious Desi Designed t to Puni Punish Planned anned tax tax-avoi

ida

danc nce Moti Motivation

n -
different

SLIDE 2

6/4/2012 2

EXPECTATIONS OF A FORENSIC EXPERT

Prim Primary fin financial in investigator Unco covering unre unreported incom income and and asse assets Exper pert w witness – ess – testim timony Ad Adviso sor to r to atto torne rney:

Finance
Tax
Business Practices

PROFESSIONAL RELATIONSHIPS WITH MATRIMONIAL ATTORNEYS

What i What is att attorney looking f for? Cr Creden entials als Exp Experience ce Re Reputa tatio tion Deme Demean anor

ATTORNEYS

Attorneys – – few ha have the the w work rking g knowle knowledge of busi busine ness, tax , tax and and acco account unting ng m matt tters that acco that accoun untants do do!

SLIDE 3

6/4/2012 3

THE ACCOUNTING EXPERT

Acco ccoun unting e expert: Mo More C re Curre rrent:

Matters of business accounting
Techniques used by business people
May be less expensive
Understand tax matters

ACCOUNTANTS AS EXPERT WITNESSES

“Accoun ccountants as as expert witne witnesses can can be be very use useful be becaus cause of the their abil ability to testify

n
n a broa
ad r

range of fin

f financial, t

tax a x and business pr practices.”

WRITTEN REPORT AND FORMAL DECLARATIONS

Fo Forensi nsic expert m must have d decent w nt writing s g skills Re Report will b be intr troduced into to c court a t as evid idence Repo port must must be be a a mo mode del o l of clari clarity Le Least ast am amount of “ “acco ccountant nt-speak ak”

SLIDE 4

6/4/2012 4

TESTIMONY IN COURT

A A writ itten rep report, in in and d of its

f itself, is n

is not t admi missibl ble a as evidence in in a a cou court of la

f law.

Tech chnical cal t term rm – – it t is is he hearsa arsay. To be ac accept pted ed – – exper ert m must test stif ify

ENGAGEMENT CONSIDERATION

Conflic licts o s of interest a terest and bias

Non-divorce related services to one of the spouses
AICPA Code of Conduct
Related parties
Opposing Counsel
Disqualification

Keep eep an open

pen min

mind t to a avoid

id bia

bias Coop

operation of t
f the pa

e parties Lo Locat cation Approp

priat

ate S e Skills and and Experien ence ce Tim Timing and and Due Due Dat Dates Def Definition o

f Ser

Services Avai ailable F e Fina nanc ncial ial R Reso sources Fee St ee Stru ructure

WHO IS YOUR CLIENT?

Re Retained by by a atto torne rney

Attorney-client privilege
Attorney-Work-Product privilege

Pa Party’s e expert Neu Neutral e expert:

Court’s expert
Mediator’s expert
Joint expert

Engagemen gagement Letter and er and Retainer A iner Agreemen ement

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6/4/2012 5

ENGAGEMENT LETTER

Natur Nature o

f the

the re relat lation

nship

Parties t ies to the agr agreemen ement Party r y respo sponsi sible f e for p r payment ent Th The lim e limitation

ns on
n the n

e numb mber of h

f hours or
r fees –

– “no fix fixed f fee”. Forensic nsic a accountan tants e s exact d t duties Allo Allowance f for w with thdr drawal

UNDERSTANDING THE PROCESS

Pr Property rule rules in in v vario rious stat states

Community
Marital
Separate Property
Equal or Equitable Distribution

BASIC MATRIMONIAL LITIGATION PROCEDURE

Preliminar iminary P y Phase Fault o t or N No-Fault ault S Stat ate Disc Discover ery Dema Demand f for Doc Documents Financial a ncial affida davit vit Interrogat

gator
ries

ies “T “Tak aking the the Fif Fifth” Depo Depositions Third-Par Party S y Subpoenas

enas

Request f est for r admissions ssions Loca Local r rules les of

f cour

court

Required mediation

Expert W Witne tness D ss Disclosur losure Depo Deposition of

f Ex

Exper pert Pretr Pretrial and and T Tria ial Po Post-d

div

ivor

rce

ce P Proceedings ngs

SLIDE 6

6/4/2012 6

FORENSIC EXPERTS’ ROLE IN COURTROOM

Gener General Pr l Provisions

Educate
Jury and Judge
“Everyman’s Language”
Explain your work
Try to make yourself likeable

Dress C ss Code Ad Addressing t essing the C Court, t, O Other C r Counsel a sel and the J Jury Testimon imony D Demean anor

r

Pa Pape pers rs a and d Org Organization

TESTIFYING

Prelimin iminary Q y Qualif ific ication ion

Credentials
CV or resume`
Waiving expert credentials

Dire Direct ct, Cr Cross and and Redi direct ct Exam Examinations Obje Objections Visu Visual al Aids Aids Depo Depositions

MARITAL PROPERTY

Va Valuation Charac Characteriza zation

n

Divi Division Mar Marital A l Agreement eements

Prenuptial Agreements
Standard of Conduct Between Spouses

Tr Trust a and Estates

SLIDE 7

6/4/2012 7

MARITAL FRAUD

Def Definition o

f Fraud

aud Why S Spouses ses Commit it Fraud St Standard of

f Conduct

BADGES OF FRAUD

Beh Behaviors Co Cond ndition itions Evid Evidence Lifest styl yle I e Issues es Diver verted ed o

r Hidden

en Income me Inappr appropria

priate T

e Tran ansf sfer ers s Busin siness ss Wild ld G Goos

ose C

Chase

INVESTIGATING BUSINESS ASSETS

Role-Evaluation luation o

f t

the Business ness Pe Perks UR URI Depreciatio iation m methods thods

Bonus
Section 179

Va Valuation E Expert Buy-Sell A Sell Agreem ement ents Re Real V Value Active ve v

vs. Passive

ve Gif Gift T Tax x Retu turns – – Disc iscounting Ta Tax F Fraud

SLIDE 8

6/4/2012 8

BEGINNING THE INVESTIGATION

Obtaining t ining the N Necessar ssary D y Documentation mentation Business T ss Tax R Returns rns Business ss Agre reement ents a and C d Contract ntracts Corp rporat ate O e Ownership rship Records Comp mpan any F y Financial S ncial Stat ateme ements Appointme intment B t Book –

k – Calendar

dar “Docum umenta tation D Durability ty” Loan Loan Docu Documents In Insurance Pa e Pape pers rs Ban Bank R Reco cords Fina Financial Sta Statem ement M Mani nipulation

“URI” UNREPORTED INCOME

Pe Personal al L Lifestyle style Investi vestigation Conce ncealing asset assets or inco income

“PROCESS FOR FINDING URI”

Ev Evaluate I Inco come me T Tax R Retu turn rns Gif Gift T Tax R x Returns Tr Trust I Income Ta Tax R Returns Ba Bank R Records

Compare Sources of Income

Ca Cancelled Che Checks Ba Bank De Deposits Inc Income Ex Expe pected b but no t not t included Gif Gifts a and I d Inhe heritances Pe Person

nal E

al Expens nses es Nonmari arital al Re Real E Estate Nonmari arital al Pe Personal

nal P

Property Paymen ent o t of Cred edit C Card B rd Bills Seco cond R Rental o

r Ut

Util ility Bil Bill Cre Credit Ca Card Reco cords Saf Safe D Deposit B t Box R Records Brok

ker

erage A e Account Re t Records rds Loan A Loan Applications ns and F and Financial Stat Statements

SLIDE 9

6/4/2012 9

MARKETING YOUR SERVICES

Id Iden entify y your M Market Methods o s of G Genera rating B ting Busin siness ss

Referrals
Personal
Fellow Professionals
Existing Clients

Semina minars and and Othe her S Speaking ng Engag gagement ments We Website Busin siness ss C Card rds Br Brochures Ne Newsletters Giveaw away ays Endorsemen rsement L Letters ers Direct M Mail Solicita citati tion Ad Adve vertisin ing

6/4/2012 THE ROLE OF THE FORENSIC ACCOUNTANT Very F Few w - - PDF document