Accounting is a topic that can frighten otherwise brave professionals. All the asset, liability, income, and expense talk can be overwhelming if the listener is not trained in the field of accounting. The best forensic accountants are able to present financial issues in litigation so that they can be understood readily. Attorneys, judges, and juries often lack an accounting or finance background, so being able to break down financial topics in a way that is easy to understand is essential for forensic accountants.
An area of divorce financial analysis that is of great interest to attorneys and accountants is the standard of living. Jurisdictions have varying factors that come into play when determining the standard of living. The attorney must be familiar with local rules. However, this chapter details the most important factors that ought to be considered in analyzing the standard of living of spouses.
As discussed in Chapter 2, the standard of living enjoyed by the spouses during a marriage is often one of the main factors in awarding spousal support and child support. One cannot determine the “reasonable need” of a spouse unless the actual expenses during the marriage are analyzed. The standard of living will be determined on the basis of historical expenditures, with some modifications or adjustments depending on local rules and/or the circumstances of the case.