Going through a relationship breakdown can be an extremely tough time – emotions run high, and communication can be less effective between parties. It’s also likely
that facts can be clouded by emotion making it very difficult to move through what can only be described as a difficult process.
There are two reasons for this. Firstly, when entering a divorce process, it’s important to identify your assets and liabilities clearly, so that each party receives a fair amount during settlement. The second is that if you don’t disclose accurately, the settlement can be re-litigated at a later date.
To accurately determine what your assets and liabilities are, you may wish to seek from a qualified adviser.
ipac financial expert, Carey Allen, stated that correctly determining your assets and liabilities is “of the utmost importance and getting it wrong can have serious ramifications”.
It’s crucial because you need to understand what both parties possess, and from there, what both parties can receive in the settlement.
“A lot of personal interests are at heart with a lot of people, and traditionally what you will see is people will fully disclose what their assets might be but they also might have equity stakes in businesses that they used to work for,” stated Mr Allen.
This highlights the difficulty in putting a dollar amount on certain assets. Things like priceless artwork, patents that have not yet been released, or the ownership of a business can be hard to value.
“Often one party will have a different idea about the value they would place on an asset,” Mr Allen said.
In events such as these, a forensic accountant could be used to help determine the value of such assets using a number of valuation methodologies.
When identifying which assets you wish to receive in settlement, it’s important to consider how they may affect your future.
Mr Allen said that a can sit down with a client and help them to create a plan of how they want their future to look.
“Our process is to try to understand what the realistic lifestyle and future needs a client has, and then work backwards across a few different scenarios,” said Mr Allen.
“Often clients come to us when all they can see is despair. We focus on demonstrating some of the financial options they may have available to them and they
often walk away feeling empowered,” he said.
we can help
If you are going through a relationship breakdown, we can help. Why not get in touch by calling 1800 626 881 or by using the ‘contact us’ tool on our website.