One of the challenges of divorce as a business owner is ensuring the proper valuation of your business for the settlement. It can be challenging to assess the value of your own business for a divorce, but some professionals can help.
You might need a forensic accountant to assess your business before the divorce hearing.
Can you both agree on a forensic accountant?
When both parties in the marriage agree, you can hire a single forensic accountant for the business valuation. Once the accountant completes the valuation, you both have the opportunity to review it. If you both agree with the findings, you can either use it as the framework for your proposed settlement agreement or present it to the judge for their use.
What if one party disagrees with the valuation?
Ideally, both parties will accept the valuation provided by the forensic accountant. Should one disagree, you may both hire independent professionals to repeat the process and then settle on the valuation that you both feel is most fair, but this leaves you paying for the same service several times, which can be costly.
Can the judge assess the reasonability of the valuation?
If one party disagrees with the valuation but you are unwilling to repeat the process, the judge in your case can review the valuation and rule on its validity.
A business valuation is important for equitable asset distribution and to protect the financial interest that you hold in the business amidst your divorce. With the valuation, you have a financial target for either of you to buy out the other spouse.