How does financial disclosure work in divorce?

Divorce financial disclosure Form E may include information on the following, together with supporting documentation:

• Property values
• Mortgage balances
• Bank account balances
• Savings, investments, or other such account balances
• Liabilities
• Income 
• Business values
• Pension cash equivalent values

Once Form E has been completed (with all relevant supporting documents attached), it is exchanged (preferably simultaneously) with the other party.

Each party then has an opportunity to consider the details provided and, should they wish, ask for further evidence or clarification. 

The intention is to ensure that 

(a) the parties believe they have all the information they need to understand the other’s financial circumstances and

(b) there are no hidden assets or otherwise suspicious transactions.

For more information, read the dos and don’ts of how to complete a Form E here. If you feel comfortable sourcing and filling out forms yourself, consult with local divorce solicitors for help.

There are other elements of financial disclosure that are worth considering. 

These include:

• The value of assets: If there are assets of significance, but the value is disputed, an expert will need to be instructed. This can include surveyors to value property, chartered accountants to value businesses, or actuaries to assist in valuing pensions.
• The mortgage capability of both parties: It is important to understand how much each party can borrow on a mortgage to rehouse themselves in the future. Each party should speak to a mortgage broker who can then write to confirm the details regarding their maximum borrowing capacity. 
• The parties’ reasonable housing needs: To determine what each parties’ reasonable housing needs are likely to be, they should each provide particulars for properties on the market for sale that they believe would be suitable for themselves and the other. 

If both parties are satisfied with the information, they can negotiate a fair and reasonable divorce settlement. If or when an agreement is reached, this should be formalised into a document known as a consent order, which is then sent to the court. Consult with your respective family law solicitors to arrange this.

The court will review the agreement and, providing it is considered reasonable and fair, will formally approve the order. 

Once a consent order is approved, it offers the parties security and certainty in how the assets will be divided and that their agreement is enforceable.