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Accurate financial reporting in high asset divorce cases

Any New Yorker going through a divorce should know that his or her financial picture will be closely analyzed and even dissected by the opposing attorney. The chances of greater and more exacting financial scrutiny are higher in high net worth divorce cases, because more money is at stake.

A legal structure is in place for furnishing financial information to the court and it formalizes the divorce process. If a divorce is contested, then both spouses must provide financial affidavits. This documentation is referred to by different names in different states, but every state has a similar requirement. Completing a financial affidavit is a very complicated and critical matter. It takes much more than reviewing one's checking account and credit card statements. One of the most important aspects of an affidavit is that it is a legal "swearing" that the information being provided is true. A complete and truthful financial picture of each spouse is particularly important in the division of high-value marital assets.

A financial affidavit is usually most effectively prepared by a financial advisor. A divorce attorney may only skim through the financial affidavit and may not review each entry individually for veracity. For example, if a spouse states that he or she spends $700 a month on clothes, then a divorce attorney may only question this line if the amount appears to be inconsistent with other expenses.

A financial affidavit also asks for exact, detailed information. Such information will be in the form of regularly paid bills, such as mortgages, and less frequent purchases, such as shoe purchases and so on. A financial affidavit is used to determine a spouse's financial health and will be a key document used to set alimony and achieve a fair and equitable division of marital assets. An accurate and carefully completed financial affidavit is an important part of making high net worth divorce proceedings go smoothly.

Source: Forbes, "The Importance Of Financial Affidavits In Divorce And A New, Cool Tool To Help You Get It Right," Jeff Landers, June 11, 2014

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