Litigation & Dispute Resolution

April 14, 2020

AICPA Issues New Forensic Services Standard Effective January 1, 2020

Statements on Standards for Forensic Services (“SSFS No. 1”) are issued by the AICPA’s Forensic and Valuation Services Executive Committee. SSFS No. 1 provides guidance and establishes enforceable standards for members performing certain forensic and valuation services, specifically, for litigation and investigation engagements. These engagements are defined by SSFS No. 1 as follows:

  • Litigation. An actual or potential legal or regulatory proceeding before a trier of fact or a regulatory body as an expert witness, consultant, neutral, mediator, or arbitrator in connection with the resolution of disputes between parties. The term litigation as used herein is not limited to formal litigation but is inclusive of disputes and all forms of alternative dispute resolution.
  • Investigation. A matter conducted in response to specific concerns of wrongdoing in which the member is engaged to perform procedures to collect, analyze, evaluate, or interpret certain evidential matter to assist the stakeholders (for example, client, board of directors, independent auditor, or regulator) in reaching a conclusion on the merits of the concerns
Prior to the issuance of these standards, litigation and investigation engagements were covered by the AICPA Statement on Standards for Consulting Services No. 1 and the AICPA Code of Professional Conduct. As the need for forensic services has grown and evolved, SSFS No. 1 serves to protect the public interest and increase the level of consistency across the profession. The issuance of SSFS No. 1 reflects a consolidation of relevant forensic services standards into one single standard. These forensic standards are effective for engagements accepted on or after January 1, 2020. Ensure that your hired expert, if applicable, is aware of these new requirements and is aware of the applicable standards for the engagement. To download the Statement on Standards for Forensic Services click here.
Originally published in Mercer Capital’s Tennessee Family Law Newsletter, Volume 3, No. 1, 2020.

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A Financial Perspective and Overview of Marital vs. Separate Property in Divorce-Part 3
A Financial Perspective and Overview of Marital vs. Separate Property in Divorce

Part 3: Illustrative Examples

Part 3 applies these concepts through two examples which are hypothetical and simplified to illustrate the financial analysis that an expert may perform. The examples do not determine whether an asset or change in value is marital or separate. The applicable law, relevant dates, and facts of each matter govern counsel in that determination.
A Financial Perspective and Overview of Marital vs. Separate Property in Divorce-Part 2
A Financial Perspective and Overview of Marital vs. Separate Property in Divorce

Part 2: Valuation, Financial, and Forensic Considerations

In Part 1, we discussed the general distinction between marital and separate property. Part 2 takes a closer look at the valuation, financial, and forensic issues that can complicate the analysis of marital vs. separate property: tracing assets over time, evaluating commingling or potential transmutation, identifying liabilities, and analyzing changes in value. The relevance and treatment of these issues vary depending on jurisdiction and the applicable legal framework.
A Financial Perspective and Overview of Marital vs. Separate Property in Divorce-Part 1
A Financial Perspective and Overview of Marital vs. Separate Property in Divorce

Part 1: Property Classification

When attorneys think about financial experts, they often think about reports, depositions, and trial testimony. Yet many of the valuable contributions a financial expert can make occur much earlier in the case. In matters involving valuation, income determination, or forensic accounting, earlier expert involvement may help counsel identify key financial issues, assist in discovery, evaluate settlement positions, among others.

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