A forensic accountant is generally an accountant with expertise in detecting financial fraud or manipulation in personal and business tax returns, bank accounts, investment accounts, retirement accounts, broker accounts, offshore accounts, cash, cryptocurrency, jewels, art, cars, yachts, airplanes, real estate, life insurance policies, and related financial documents. This financial investigation work is often referred to as tracing, financial tracing, or asset tracing, and generally involves “following the money” by tracing a piece of financial information or data back to its source.

In divorce litigation—and especially in high-asset or high-net-worth divorces in which there is significant marital or community property—any financial manipulation or fraud of personal or business finances may have a significant effect on the marital or community property that is available for division, and on spousal support and child support payment amounts. One or both spouses in a divorce may hire a forensic accountant to discover any hidden assets or manipulated financial documents that may prevent the court from having an accurate accounting of the marital or community property assets and the spouses’ incomes.

In North Carolina, forensic accountants play a crucial role in divorce proceedings, particularly in cases involving high-net-worth individuals or complex asset portfolios. These specialized accountants are tasked with uncovering financial discrepancies, hidden assets, and evidence of fraud or manipulation within personal and business financial documents. Their expertise in tracing financial transactions is essential in ensuring an equitable division of marital property and the accurate determination of spousal and child support obligations. North Carolina operates under the principle of equitable distribution, which means that marital property should be divided fairly, though not necessarily equally, between spouses upon divorce. The findings of a forensic accountant can significantly influence what is considered 'marital property' and its valuation, thereby affecting the outcome of the property division. Additionally, accurate financial information is critical for determining appropriate support payments. Therefore, the work of forensic accountants is often integral to the discovery process in divorce litigation in North Carolina.