Financial Statements: Why do we use financial statements?

Today, we'll be concluding our discussion of financial statements by answering the question of why we use financial statements.

Hello, I am Deleta Grandy, and I am an associate with the Feldstein Family Law Group.

Today, I’m going to finish my discussion about Financial Statements. This is Part 2: Why do we use Financial Statements.

Why do we use Financial Statements?

Your income is key to figuring out how much you may have to pay in child support, and how much spousal support you may receive or have to pay, so confirming how much you actually earn is crucial.

Second, if you want to make a claim for spousal support, you may be asked to show that you have a need for the support, and if you do not want to pay spousal support, you may be asked to show that you do not have the means to pay.

Third, if someone is helping you pay your bills, this would also be relevant to whether you have a need for spousal support or the means to pay spousal support.

Fourth, if you have property from your marriage to divide with your spouse, we need to know the value of the property you gained from the date you married your spouse until you separated. We also want to know how much debt you acquired during that same time period because you are allowed to deduct that from the net worth of the property that you will eventually divide with your spouse.

Finally, we need to know the value of any items you are allowed to exclude from the net worth of the property you gained during your marriage.

You may ask why you need to determine the value of what you have on the date you sign the Financial Statement. That goes to the issue of spousal support. If your net worth has increased from the date of separation, you would have a harder time arguing that you need spousal support or that you can’t pay spousal support.

What happens next?

When both spouses properly complete their financial statements and provide the required supporting documentation, you can now confirm how much child support should be paid, how much each parent should pay towards any special and extraordinary expenses for the children, how much spousal support may be paid, and how much one spouse may have to pay to the other to equalize their property.

For these reasons, you should ensure your Financial Statement is properly completed, and you may want to consider consulting with an experienced family lawyer to assist you with this.

I’m Deleta Grandy. Thank you for watching today. If you need any more information and wish to schedule an initial consultation, please visit our website or contact our office at (905) 581-7222.

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