The importance of full financial disclosure during divorce

What is financial disclosure?

Financial disclosure should be undertaken in the divorce process to allow each party to set out their respective financial positions and to disclose documentary evidence to one another. This is in order to resolve the financial issues arising from the divorce. It seeks to achieve clarity and ensure that there are no hidden assets. This is often called giving ‘full and frank disclosure’.

Financial disclosure is required whether you negotiate a settlement through mediation, via solicitors or whether you follow financial remedy proceedings in court.

Financial disclosure is usually provided by both parties completing a document called a ‘Form E’ and providing supporting documentation. Once completed, the Form Es will be exchanged with the other party simultaneously. Once exchanged, you will be given the opportunity to raise questions regarding your spouse’s disclosure.

What information do I have to provide in a financial disclosure?

You will be required to disclose information in relation to the following:

-       Property

-       Balances outstanding on any mortgage

-       Bank statements

-       Savings and investments

-       Income

-       Liabilities

-       Business assets

-       Pension cash equivalent values

You will also be required to consider your mortgage capability, your housing, and future income needs of yourself and any dependent children. You will also need to obtain valuations for large assets such as any property and businesses, and consider any tax implications.  

It is important that the information you provide is true as you will have to sign a statement to this effect. If it is later discovered that any information is false, proceedings could be brought against that person for contempt of court.

Why is full financial disclosure important?

When considering finances on divorce, the overall aim is to find a solution that is fair to both parties, whilst taking into account the needs of any children of the family. The purpose of financial disclosure is to ensure that there is transparency in relation to each party’s assets in order to negotiate and reach a settlement that is fair and reasonable.

Financial disclosure allows the solicitors representing each party to assess the assets in question before advising the likely approach the court will adopt when considering the division of assets. 

If financial disclosure is not given between the parties, there is the potential that some assets will be concealed meaning a fair outcome may not be reached. It is in both parties’ interests to reach a fair and reasonable final settlement, which can be achieved through providing thorough financial disclosure. If an agreement is reached, this will be embodied in a document called a Consent Order which will then be sent to the court for approval.

If you require assistance completing your Form E, or if you require advice in relation to the overall divorce process, contact our expert divorce lawyers. We offer a free 15 minute telephone consultation and have the ability to offer appointments both virtually and face-to-face. I am based in the Colchester office and can be contacted on 0330 818 3071 or katherine.parker@birkettlong.co.uk.