Forensic Accountant & Business Valuation Expert for Rhode Island 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 Rhode Island 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 Rhode Island is heard in the Family Court. Federal matters are heard in the District of Rhode Island. Mr. Friedman is regularly engaged in matters in states across the United States, as well as in international matters, and the firm accepts Rhode Island 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. Rhode Island’s professional community is a particularly small one.
• Records-based work travels. Tracing and appreciation 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 a Rhode Island Case

One premarital asset, three different answers

The statute draws a line most states do not draw. The court may not assign property held in one party’s name before the marriage. But it may assign income derived from that property during the marriage, and it may assign the appreciation in value from the date of the marriage where the property increased in value as a result of the efforts of either spouse.

A single asset therefore has to be taken apart rather than characterised. A premarital rental building is protected as a building; the rents it produced during the marriage are not; and the part of its increase in value that came from a spouse’s work on it is not either. The same three-way question applies to a premarital company, a premarital portfolio and a premarital interest in a partnership.

The distinction that decides the third part is cause, not amount. Appreciation is assignable where it resulted from the efforts of a spouse — so growth that happened because a market rose is on a different footing from growth that happened because someone worked. Separating the two is an accounting exercise performed on transaction records, financial statements and evidence of what each party actually did, and a single figure for “what it is worth now” does not begin to answer it.

Inheritances and third-party gifts are excluded completely — which makes tracing decisive

The statute says the court shall not assign property transferred to a party by inheritance before, during or after the marriage, and likewise property transferred by gift from a third party before, during or after the marriage. That is broader than the usual rule, which tends to protect only what was received during the marriage.

The protection is strong, and it is exactly why identification matters so much. An exclusion this wide is worth a great deal when the asset can still be identified, and worth nothing when it cannot. Inherited funds deposited into a joint account and spent on family expenses, or an inherited interest reorganised into a new entity, raise a tracing question rather than a legal one. The work is following the property through whatever happened to it and documenting what remains identifiable.

Conduct counts here, and transfers made in contemplation of divorce are named

Unlike a number of states, Rhode Island lists the conduct of the parties during the marriage among the factors. It also names, separately, wasteful dissipation of assets or any transfer or encumbrance of assets made in contemplation of divorce without fair consideration.

That second clause is effectively a fraudulent-transfer provision inside a divorce statute, and it is a records exercise: identifying transfers and new encumbrances, establishing their timing against the breakdown of the marriage, and testing whether fair consideration actually came back. A transfer to a relative, a sudden loan against an unencumbered asset, or a sale at a price nobody can support are all visible in the documents, and the question the statute asks — was there fair consideration — is a valuation question.

The factor list also includes the contribution of each party to the acquisition, preservation or appreciation of their respective estates, contribution as a homemaker, and contribution to the education, training, licensure, business or increased earning power of the other. Each of those can be quantified rather than merely asserted.

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 Rhode Island law.

Forensic Accounting and Litigation Support

Corpus, Income and Appreciation Separation

Taking a premarital asset apart into the three components the statute treats differently — the property itself, the income it produced during the marriage, and the appreciation attributable to either spouse’s efforts — with each supported by records rather than allocation by assumption.

Inheritance and Gift Tracing

Following inherited or gifted property through accounts, entities and transactions to establish what remains identifiable, since Rhode Island’s exclusion is unusually wide but depends entirely on the property being identifiable.

Transfers in Contemplation of Divorce

Identifying transfers and encumbrances made as the marriage broke down, establishing their timing, and testing whether fair consideration was actually received — the express statutory question, and a valuation one.

Business Valuation Disputes

Valuation of closely held businesses 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 Rhode Island, very often including whether a premarital asset was actually separated into corpus, income and effort-driven appreciation or treated as a single number.

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

I owned my house before the marriage. Can the court give my spouse part of it?

Not the property itself — the court may not assign property held in one party’s name before the marriage. It may assign income derived from that property during the marriage, and it may assign appreciation from the date of the marriage where the increase resulted from the efforts of either spouse.

My premarital business is worth far more now. Is that increase divided?

Only to the extent it resulted from the efforts of either spouse during the marriage. Growth attributable to those efforts is assignable; the business itself is not. Establishing which part is which is done from the financial records and the evidence of what each party did.

What about the rent my premarital property earned?

Income derived from the property during the marriage may be assigned, even though the property itself may not. That makes the income stream a separate question from the asset.

I inherited money. Is it protected?

Property transferred by inheritance is excluded whether it came before, during or after the marriage, and the same applies to gifts from a third party. The practical issue is usually whether the inherited property can still be identified after years of banking and spending, which is a tracing question.

Does my spouse’s behaviour during the marriage matter?

Yes. The conduct of the parties during the marriage is one of the listed factors, and dissipation of assets is named separately, as are transfers or encumbrances made in contemplation of divorce without fair consideration.

My spouse moved assets just before filing. Can that be addressed?

The statute names transfers or encumbrances made in contemplation of divorce without fair consideration as a factor. Establishing it involves identifying the transactions, fixing their timing, and testing what was received in return.

Which court hears a divorce in Rhode Island?

The Family Court.

Can a Florida-based expert work on a Rhode Island 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?

For a premarital asset, the position at the date of the marriage plus the full transaction history since, separating income received from capital movement, together with evidence of the work each party did on it. For an inheritance or gift, the transfer documents and the complete path of the funds afterwards. For a transfer question, the deeds, loan documents and account records around the relevant period. Date-of-marriage valuations and the income records are the two items to request first — without them, the three-way split the statute requires cannot be performed at all.

What credentials should a financial expert in a Rhode Island 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 a Rhode Island 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.