Industry Insights for Accountants: Disclosure Requirements for Family Law Purposes
When a couple is going through separation or divorce and are amid of a property settlement, accountants and family financial advisors are often needed to assist with information gathering. Family lawyers will need information about their client’s financial circumstances but may also need assistance in determining the value of their client’s assets. More information on asset valuation can be found in our blog post.
The Many Aspects of Disclosure
In family law property settlements, family lawyers will need to gather information about their client’s assets as well as their financial resources. Whilst much information can be found from the client’s individual tax returns, this in only enough is the most simplest of cases. More often than not, clients will have their assets in businesses or family trusts and gaining a comprehensive understanding of the client’s financial circumstances is essential for family lawyers.
Some complex family law property settlements may take months if not even years to complete and receiving updated financial information is important. In some cases, family lawyers will need to ask accountants for updated information every quarter so that they can negotiate the best outcome for their clients. This requirement may seem burdensome and frustrating but it is important to understand that parties to a family law property settlement have an ongoing disclosure obligation and this will be reflected on the disclosure requirements put on accountants and financial advisors.
In some cases, accountants are asked to provide documents and financial statements for a party to a property settlement who is a partner in a business. Additional considerations may be required from accountants before complying with such requests from family lawyers. Accountants may need to consider whether, the business as their client, may need to obtain independent legal advice on the extent of the disclosure obligations and whether sensitive business documentation has to be disclosed.
For more information on how accountants and financial advisors are involved in Family Law matters, visit our other blog posts on the topic: