2011 Domestic Forum Tennessee Association for Justice March 24, 2011 Memphis, Tennessee

1. 2011 Domestic ForumTennessee Association for JusticeMarch 24, 2011Memphis, Tennessee Forensic Accounting And When It Will Help Your Case Presented by: Robert Vance, CPA, ABV, CFF, CVA, CFP Forensic & Valuation Services, PLC 901-507-9173 www.ForensicVal.com rvance@ForensicVal.com

2. My Favorite Actual Search Engine Hits on www.ForensicVal.com On Point • ability to pay attorney fees if husband has all marital assets • alimony tennessee wife friviouls spending • are draws against profits shown on form w2 • can a person hide income through retained earnings • can a spousecash out their 401k and spend it without the other one knowledge • can i receive both alimony and cash settlement • can money spent by one spouse offset savings when dividing maritial property • dissipation of marital assetts is it hard to prove? • do guaranteed payments to partners always flow to 1040? • do vocational expert witnesses in a divorce case help with lowering alimony • formula exist to calculate which portions are marital or individual property • gross financial irresponsibility in divorce • how do you stop husband from dissipating funds • if i have been divorced for 6 yrs. and receive eprm. alimony may i request cost of living increase? • is 401 k an asset in alimonty adjustment order • k1 income vs. cash income in a divorce • negative equity divorce settlement offset retirement • partner takes salary vs guaranteed payment • paying alimony with investments • proving the ability to paid alimoney • retained earnings or k1 in a s-corp when there is adivorce • self employed husband hiding money • valuation in divorce of life time non vested lifetime medical insurance • work in progress role in net assets valuation

3. My Favorite Actual Search Engine Hits on www.ForensicVal.com Funny • aa pilot hiding assets in divorce • divorce paying for living with and paying for girlfriends expenses in connecticut excessive spending • divorce should i cash out husbands retirement before he hides it • husband spent all assets before divorce • divorce unemployed husband who spent his 401k how do i keep him from getting mine • separatione monthly income and expense sheets to be favorable for wife • is a diamond ring considered an asset in a divorce? • can you be single during a divorce in tennessee? • is 5,000 per month alimony too much

4. My Favorite Actual Search Engine Hits on www.ForensicVal.com Other Relevant • ability to pay analysis • can a partner in a s corporation take draws in addition to salary • can a woman in tennessee draw pension benefits and alimony? • catching unreported income • child support based on w2 gross? • converting pre-marital property to marital property tennessee • coverture fraction district of columbia • cpa prepares returns partner as employee w-2 • credit card debt alimony ability to pay • credit card payments considered alimony • dissipation of assets argument • dissipation of assets in divorce + deposition questions • divorce and retirement pensions in tennessee • divorce how to calculate car separate value • divorce needing emergency cash in ira • divorce what is a business evaluation compared to a forensic accountant • does a spouse owe fica on alimony maintenance • does child support withheld go on w2 • draw can be taken in leiu of salary • eldridge v eldridge • hiding money from spouse capital pool • how do husbands draw alimony, tennessee

5. My Favorite Actual Search Engine Hits on www.ForensicVal.com Other Relevant • how do i prove dissipation • how to figure pension value for divorce • how to prove depletion of marital funds in a divorce • i paid the joint mortgage and real estate taxes for nine months before the divorce can i claim those expenses as alimony • in a divorce how do you calculate the balance of a non-vested pension • investment earnings marital property • is k-1 income a marital asset? • jewelry separate property, tn • medical practice valuation personal goodwill • noncompete clause in tennessee jackson clinic • professional practice valuation • sole proprietorship owner payments reflect on profit and loss statement • tennessee antenuptial employment earnings • unreported income excessive dividends • unvested pension factor divorce • what box on w2 used for child support calculations? • what is value of upside down car on marital balance sheet • what to consider in the s corporation ownership & the property division of divorce • when calculating present value what is the discount rate during pension valuataion • when verifying income what line of taxes do you look at

6. Case in Point for Using Forensic Accountants Church v. Church; No. M2009-02159-COA-R3-CV • Can the Court consider income-producing assets awarded in the division as sources of income for support in alimony modification– Yes! (No Double-Dip) • Could have used an “Ability To Pay Analysis”

7. Case in Point for Using Forensic Accountants Church v. Church; No. M2009-02159-COA-R3-CV • Can the Court lower the alimony obligation due to having lower income and making bad investment decisions – No! • Could have used an “Lifestyle or Expense Analysis” • Should the Husband not brag about traveling with his new wife? • "[M]y wife likes to go places. She's young."

8. Big Picture Marital Estate • Identify • Classify • Quantify Support • Need • Ability to Pay

9. Marital Estate – Identify • Discovery – Get us in early! • RPD • Interrogatories • Evaluating Early (sometimes crazy) Offers • Avoid a Claim of Malpractice - Don’t Show up to the Beauty Contest Without a Swimsuit!

10. Marital Estate – Identify Forensic Examinations • Finding “Hidden” Assets and Sources of Income or “True” Income for Support • W-2s and Tax Returns • Schedule B • Schedule E • Actual Cash Flow Distributions vs. Taxable Income

12. A 48,000 48,000

13. Schedule E, pg. 2 from 1040 From K-1

14. Marital Estate – Identify • Finding “Hidden” Assets and Sources of Income or “True” Income for Support • Personal Bank Statements & Credit Card Statements • Compiling Cash In and Out • Standard of Living Analysis • Tracing Deposits and Disbursements • Dissipation • Transmutation

16. Marital Estate – Identify • Finding “Hidden” Assets and Sources of Income or “True” Income for Support • Personal Expenses Run Through the Business • Retaining Earnings in the Business • Has the double-dip question of income producing assets vs. income for support been answered? - Church

17. Marital Estate – Identify • Finding “Hidden” Assets and Sources of Income or “True” Income for Support • De Facto Partnerships • Non-Qualified and “Unconventional” Deferred Compensation Plans (does his buddy own the company?) • Net Worth Analysis

18. Marital Estate – Identify Forensic Examinations • Examining QuickBooks and Quicken Transactions in Electronic Form vs. static PDF form • Cost/Benefit of an Exam

19. Marital Estate – Classify Separate vs. Marital • Is the income generated by separate property passive or can it be the spouses job? • Pre-Marriage and Post-Marriage Appreciation – Snodgrass • 401(k)-No • IRA-Maybe

20. Marital Estate – Classify Separate vs. Marital • Has the spouse substantially contributed to the preservation and appreciation of the stock? - Keyt • Managerial Authority • Hiring and Firing Employees • Allowing Earnings to be Retained?

21. Marital Estate – Classify Separate vs. Marital • Comingling • Transmutation • Completed Gifts

22. Marital Estate – Quantify Assets & Liabilities • See TBA article: “Breakin’ Up is Hard to Do” • It’s on my website of course • Compiling a Marital Balance Sheet

24. Marital Estate – Quantify Assets & Liabilities • Business Valuation • Is-there-anything-there-at-all-analysis? Is it just a job and no more? • Professional Practices • Personal vs. Enterprise Goodwill • Smith • Witt • Roberts • Is he/she purposely tanking the business?

25. Marital Estate – Quantify Assets & Liabilities • Pensions & Retirement • Valuation • Interpretation of plans • Figuring/Verifying Current and Future Payouts • Assist with QDROs • Unusual Plans

26. Support – Need & Ability to Pay • Lifetime Analysis vs. Monthly • Poverty Timeline • Net Worth Accumulation • Multiple Scenarios • With Kids • Without Kids • Present House • New House

27. Support – Need & Ability to Pay • Does a spouse really have a need? • Considering Proposed Division and Return on Assets • Taxes • Ability to Pay • Change of Circumstance Analysis • Church