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Financial Issues This forum is for discussing any of the financial issues involved in your divorce.

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Old 09-08-2013, 12:33 AM
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Default Forensic Accountant

So. I still don't have a decided income on my ex. He's refusing to get the forensic accountant because he doesn't want to spend the money.
Is it not law that we come up with his income?

This is the guy who doesn't dispute his income, but wants to take 75% off because he believes capital gains from real estate aren't income, bla bla bla. Although this seems to be a good stall tactic for him.
Will he be able to argue a forensic accountants findings?
I'm so sick of not having a final number and him stalling on it, I'm ready to pay the whole F.A. myself.
This number makes a Huge difference in calculating CS, and I still haven't got the income for 2 years now.
I'm really frustrated by this. Can't a judge force him to just get the damn accountant?
My lawyer has his disclosure, do I even need ex's approval if I just pay for it? Do they need to go to his office?
Arrrrgggg.
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Old 09-08-2013, 06:19 AM
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Originally Posted by Karver View Post
So. I still don't have a decided income on my ex. He's refusing to get the forensic accountant because he doesn't want to spend the money.
Generally, if you are disputing his income statement (Form 13.1/13) it will be you who should bear the expense of a forensic accountant. Hate to break it to you this way. You should seek an offer to settle that you will pay for a forensic accountant provided he provides full disclosure for the selected professional to access all and any financial information at any institute internationally. You should also seek to agree that the cost of having this professional do this work at a later date based on the results from this professional.

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Originally Posted by Karver View Post
Is it not law that we come up with his income?
If he has submitted a Form 13/13.1 (affidavit) then he has come up with his income in accordance with Rule 13 of the Family Law Rules. There isn't a "we" in financial disclosures. You provide a Form 13.1 and he provides a 13.1. You don't do a "joint" financial statement.

So, if you dispute his "sworn statement" you have to present evidence. If you need a forensic accountant to do this then you will need his consent for this professional to gain access to all his financials and generally have to pay for the costs of this professional up-front yourself. You are the party in dispute with the statement so the onus falls on you to challenge his evidence.

Should you be successful in challenging his evidence then you can seek your costs for having to retain a professional to do so.

I also recommend that you make the investigation by the professional mutual. That you have the professional examine your financials as well. This falls under the principals of:

What is good for the goose is good for the gander.
You can't blow hot and cold at the same time.

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Originally Posted by Karver View Post
This is the guy who doesn't dispute his income, but wants to take 75% off because he believes capital gains from real estate aren't income, bla bla bla. Although this seems to be a good stall tactic for him.
Take it to motion if it is something as simple as this. If it is income reported to Revenue Canada on line 150 then why do you need a forensic accountant. The justice will just look at his Notice of Assessment for the past 3 years to make any determination on CS and SS.

If the person is self-employed then you have a different challenge.

Quote:
Originally Posted by Karver View Post
Will he be able to argue a forensic accountants findings?
Yes. But, first you have to get one ordered. I caution you that you will be seen as "controlling" and "obsessive" if you are doing this to seek a small increase of CS.

Generally, you only see a forensic accountant involved when estates are huge and composed of a number of different factors and most importantly assets acquired prior to the relationship.

You may end up painting yourself to the court as "aggressive", "controlling" and looking to "win" on any minor issue. If the CS difference isn't material the justice will not impose such a broad violation of someone's privacy to achieve an objective to "win" in a civil court matter.

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Originally Posted by Karver View Post
I'm so sick of not having a final number and him stalling on it, I'm ready to pay the whole F.A. myself.
I am surprised that your lawyer hasn't advised you that the Forensic Accountant will more than likely have to be paid by you up-front as you are the one contesting the other party's financial position. As well, I am surprised that the lawyer hasn't advised you that you will either need the other party's "consent" and/or a "court order" to get this professional involved.

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Originally Posted by Karver View Post
This number makes a Huge difference in calculating CS, and I still haven't got the income for 2 years now.
I'm really frustrated by this. Can't a judge force him to just get the damn accountant?
How "huge" of a difference? Child support going from 650 to 4,300 a month?

I recommend you re-read this statement. It is very "controlling". You want a judge to "force" something on someone. I do realize you are frustrated but, this statement wreaks of "control".

Just because you ask a judge to order something it doesn't mean they will. You have to provide evidence that is based on fact as to why the order should be made. You have to be successful on the balance of probabilities.

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Originally Posted by Karver View Post
My lawyer has his disclosure, do I even need ex's approval if I just pay for it? Do they need to go to his office? Arrrrgggg.
Well, you could have an independent expert evaluate the Form 13.1/13 but, it will be limited to the scope of the disclosure you have gotten. Generally, someone retains a Forensic Accountant when they are "looking" for the lost money and need someone to investigate "forensically" the past history of the person in question.

You could get a Chartered Accountant to review the statements but, you may not have enough evidence to provide any conclusive fact-based report that would be of any value to anyone.

Also, I always recommend people really consider the impact of their conduct when they are angry/upset and making statements as you have...

1. A Forensic Accountant costs about 190-265 an hour.
2. A lawyer costs about 265-600 an hour.
3. A motion of this nature is easily a long motion hearing if contested of a half day.

Forensic accountants time is say 5 days to review materials at 7.5 hours a day at 265/h+HST.

Lawyer's time to prepare and hear motion is about 5 days at 7.5 hours a day at 600/h+HST.

Your time is 100/h+HST which will be about 3 days at 7.5 hours a day.

Forensic Accountant = 11,000 (roughly)
Lawyer = 22,000 (roughly)
You = 2,200 (roughly)

So this could cost you $35,200 (roughly).

If the increase in CS is say 320 dollars a month....

It will take you 110 MONTHS to see any return on investment for your conduct. Not a single dime of what you will have done your children will ever SEE in support as it will be consumed by the court action.

Maybe when you start getting into where the difference between what you get and what is ordered is say an additional 1,500 a month then maybe it would be worth it... That is 23 months (almost 2 years) of lost CS payments to legal fees...

Remember what the saying "going for broke" means... Either you are successful or you get what you were going for... "going broke"...

Good Luck!
Tayken
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Old 09-08-2013, 09:01 AM
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After all that information Tayken, you might have taken the time to find out that Karver believes the ex made $797,000 last year.

Well worth investing in a forensic accountant.
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Old 09-08-2013, 09:12 AM
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Quote:
Originally Posted by SadAndTired View Post
After all that information Tayken, you might have taken the time to find out that Karver believes the ex made $797,000 last year.

Well worth investing in a forensic accountant.
Believes and being able to prove are two different things.
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Old 09-08-2013, 09:14 AM
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Originally Posted by standing on the sidelines View Post
Believes and being able to prove are two different things.
Absolutely SOS but I certainly would be willing to look into it.
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Old 09-08-2013, 09:29 AM
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Originally Posted by SadAndTired View Post
Absolutely SOS but I certainly would be willing to look into it.
Yes but unless she has a vast source of funds to pay for it, it could be throwing away money.
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Old 09-08-2013, 09:47 AM
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Ex has admitted hes made that much money. His and my accountant worked together to come up with the numbers he agreed to it all but says his capital gains shouldn't be in there. I'm asking EVERYONE I can whether he has a point (ex should hire ME as his lawyer) and accountants, lawyers, other real estate guy (who is also getting Divorsed) say the cap gains are included.
He has been paying me $1000 CS a month for the past year, according to my lawyers child find program, this should have been $12,000.
He has sent me this email:
"The fact is we don't agree on how to classify the numbers but I don't think there is any dispute what the numbers are."

I'm so frustrated already that what seemed so obvious has caused so much grief and money.
Maybe I should just accept his extra $100 a month and be done with it. How do you fight a rich mean guy?
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Old 09-08-2013, 10:09 AM
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so why would you need a forensic accountant if he admits to he made capital gains??? He isnt hiding it, he just doesnt think it should be included for CS, that is the real disagreement here.
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Old 09-08-2013, 10:22 AM
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So you don't need a forensic accountant, you need a judge to side with you that his income is derived from buying and selling properties, therefore his capital gains should not be excluded from his income. You're not trying to find money that is concealed, you're trying to argue against his logic that capital gains are not income. You need a good lawyer with an additional background in tax/business, who can convince a judge that your ex's income should be imputed to include some or all of the capital gains.

On a smaller scale, how do people who flip houses for a living report their incomes? Buy at $200k, invest $50k and time/effort, sell for $300k. Profit is obviously $50k, but how is it recorded on taxes? How is it used to calculate child support? Maybe you can find some legal precedents there.

I forget, are you trying to get SS as well or just CS? Should you be successful in getting CS increased in the numbers you are throwing around, you want to be very very sensible when it comes to using that money or getting used to it, because when the kids are grown, your funds will plummet.
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Old 09-08-2013, 10:22 AM
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not sure if this will help you or not. It seems to muddy the waters a bit more.

Support & RRSPs, Stock Options, Severance, Retirement Allowances, Capital Gains - Ottawa Divorce Blog
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