Forensic Accountant & Business Valuation Expert for Alabama Matters

Working With Out-of-State Counsel

Joey Friedman, CPA, P.A. is a litigation-focused forensic accounting and business valuation firm engaged by counsel in Alabama matters. The firm is based in Florida and works nationwide, handling records-based analysis remotely and traveling for deposition and trial testimony as a matter requires. Mr. Friedman has testified in state, federal and foreign courts, for plaintiffs and defendants, in civil, criminal and marital proceedings. The firm does not prepare income tax returns and does not provide tax planning services.

Divorce in Alabama is heard in the Circuit Court. Federal matters are heard in the Northern, Middle and Southern Districts of Alabama. Mr. Friedman is regularly engaged in matters in states across the United States, as well as in international matters, and the firm accepts Alabama engagements in state and federal proceedings alike.

Retaining a forensic accountant from outside the state is common in financial disputes, and in some matters it is preferred:

• Conflict distance. An out-of-state expert is less likely to have prior or ongoing relationships with the parties, their businesses, their banks or their other advisors.
• Records-based work travels. Valuation and earnings analysis are performed on documents and data. The location of the analyst does not change what the records show.
• Independence is visible. Where the parties move in the same local professional circles, distance from those circles is easier to explain to a finder of fact.

The Three Things That Decide an Alabama Case

Separate property comes in or stays out on the evidence of how it was used

Section 30-2-51 excludes property acquired before the marriage, by inheritance or by gift — but the exclusion is conditional. The judge may not consider it “unless the judge finds from the evidence that the property, or income produced by the property, has been used regularly for the common benefit of the parties during their marriage.”

Notice what that makes decisive: not where the asset came from, but what the records show about how it was used. An inherited account that quietly funded the household for a decade and one that was never touched are the same kind of asset and land on opposite sides of the line.

The work is a usage history rather than an opinion — what went in, what came out, where it went, how often, and over what period, including income the asset produced, which the statute names separately. The word doing the most work in that sentence is regularly, and regularity is a pattern you either can or cannot show from statements.

On retirement benefits, whoever claims the exclusion has to prove it — and prove the amount

Alabama does not leave this to argument. The marital estate includes retirement interests “whether vested or unvested” acquired during the marriage, and then subsection (b)(3) places the burden squarely: a party asserting that part of an interest is excluded “shall bear the burden of proving that fact and the value or amount of the excluded interest, including any active or passive income or appreciation on that interest.”

That is two burdens, and the second is the one people underestimate. Establishing that some of a pension or plan predates the marriage is often straightforward. Establishing how much — separating the pre-marital principal from what accrued during the marriage, and dividing the growth on it between market movement and contributions — is a calculation, and the statute puts it on the party who wants the exclusion.

The statute also caps what can be awarded: the total retirement benefits payable to the non-covered spouse “shall not exceed 50 percent of the retirement benefits that may be considered by the court.”

Alabama defines passive growth on retirement benefits in the statute itself

Alabama writes the definition into the statute rather than leaving it to case law. Subsection (d) provides that passive increases or decreases “are increases or decreases resulting from fluctuations in the value of the assets regarding a retirement benefit and cost-of-living adjustments made pursuant to the terms of a retirement benefit, but do not include any increases or decreases resulting from contributions, withdrawals, or accruals.” Passive change after the effective date of the award is borne by the parties pro rata.

A definition in the statute turns a familiar argument into a computation. Market movement and cost-of-living adjustments fall on one side; contributions, withdrawals and accruals fall on the other. Separating them across a plan’s history is ordinary forensic work, and in Alabama it is work the statute has already told everyone how to frame.

Personal versus enterprise goodwill

Where a business depends on one individual, part of its value may not transfer to a new owner. The firm calculates and separates the transferable value from the non-transferable value and documents the basis for each. This is a financial calculation, not a legal determination — how that split is treated is a matter for the court under Alabama law.

Forensic Accounting and Litigation Support

Common-Benefit Usage Analysis

Documenting how a pre-marital, inherited or gifted asset was actually used across the marriage — deposits, withdrawals, transfers and the income it produced — the evidentiary record behind the “used regularly for the common benefit” question, in either direction.

Retirement Benefit Tracing and Exclusion Calculations

Separating the portion of a plan or pension attributable to service and contributions before the marriage from the portion accrued during it, and quantifying the appreciation on each — the value the statute requires a party claiming exclusion to prove.

Active Versus Passive Appreciation

Dividing change in value between market movement and cost-of-living adjustments on one hand, and contributions, withdrawals and accruals on the other — the distinction Alabama’s statute defines by name.

Complete Asset and Interest Identification

Establishing what actually exists before anything is valued — entity interests, deferred and contingent compensation, receivables and interests in trusts or estates — including unvested interests, which the statute expressly brings into the estate.

Business Valuation Disputes

Valuation of closely held businesses and professional practices for divorce, shareholder and partnership disputes and buyouts, including the normalization questions that decide most of these cases: owner compensation, discretionary expenses, related-party transactions and customer concentration.

Hidden Asset Tracing

Following money through business accounts, related entities and personal accounts to establish what exists and where it went — common in divorce and in partnership disputes where one side controlled the books.

Economic Damages and Lost Profits

Quantifying what was lost, on a method that survives cross-examination, and identifying where an opposing calculation departs from the records it claims to rest on.

Fraud and Embezzlement Investigations

Reconstruction of what happened from the underlying records — misappropriation, fictitious vendors, payroll schemes and diversion — documented so it can be presented to a court, a board or an insurer.

Rebuttal and Opposing-Expert Review

Review of an opposing expert’s report to identify method departures, unsupported assumptions and figures the underlying records do not support — in Alabama, very often whether an asserted exclusion was actually quantified or merely claimed.

Deposition and Trial Testimony

Expert testimony in state, federal and foreign courts, in depositions, mediations, arbitrations including AAA, and jury and non-jury trials, for plaintiffs and defendants alike.

Frequently Asked Questions

Is my inheritance protected in an Alabama divorce?

Not unconditionally. The statute keeps inherited and gifted property, and property owned before the marriage, out of the court’s consideration unless the judge finds from the evidence that the property or its income was used regularly for the common benefit of the parties during the marriage. What the account records show about its use is what decides it.

Who has to prove that part of a retirement account is separate?

The party claiming the exclusion. The statute says that party bears the burden of proving both the fact of the exclusion and the value or amount excluded, including any active or passive income or appreciation on it.

How much of a retirement benefit can be awarded to the other spouse?

Unless the parties agree otherwise, the total payable to the non-covered spouse may not exceed 50 percent of the retirement benefits the court may consider.

What counts as passive growth in Alabama?

The statute defines it: changes from fluctuations in asset value and from cost-of-living adjustments under the plan’s terms. It expressly does not include changes from contributions, withdrawals or accruals.

Are unvested retirement interests included?

The statute brings into the marital estate interests acquired during the marriage “whether vested or unvested,” across plans, accounts, pensions, profit-sharing and similar benefit plans, from public, private, military and self-employment.

Which court hears a divorce in Alabama?

The Circuit Court.

Can a Florida-based expert work on an Alabama case?

Yes, and it is common. The analysis is performed on documents and data, which does not depend on the analyst’s location, and the firm travels for deposition and trial testimony as a matter requires.

What records are needed to start?

Tax returns with every schedule, entity documents, and account and loan records. For a business or practice, the general ledger in native form, bank and credit card statements and payroll records. For an Alabama matter specifically, the two record sets that carry the most weight are the complete history of any asset claimed to be separate — because regularity of use can only be shown over time — and full plan statements going back to before the marriage.

What credentials should a financial expert in an Alabama matter hold?

For matters that may reach a hearing, the relevant considerations are accounting credentials, experience with the specific analysis at issue, and a record of testifying. Mr. Friedman is a CPA accredited in Business Valuation (ABV) by the AICPA and a member of the Association of Certified Fraud Examiners.

Discuss an Alabama Matter

Joey Friedman is a CPA accredited in Business Valuation (ABV) by the AICPA, a member of the Association of Certified Fraud Examiners, with more than 25 years in accounting and forensic practice and an expert witness practice serving attorneys and litigants nationwide since 2014. To discuss whether the firm is the right fit for a matter — including scope, timing and whether an out-of-state expert suits the case — call 954-282-9615 or use the contact form. The firm accepts engagements in other states as well — see states served for how the analysis differs elsewhere.