Active/Passive Appreciation Analysis in Divorce Cases

Active/Passive Appreciation (“APA”) concepts and issues can be present in a marital divorce either in an Equitable Distribution or Community Property jurisdiction.

While APA concepts and issues can apply to a wide variety of assets, the presence of a closely-held business compounds the complexity of APA. You need expert opinions from a seasoned business valuation expert with specific APA experience.

Our experts:

• Have decades of experience conducting APA analyses in marital divorce cases
• Identify the factors that caused changes in values between the relevant valuation dates
• Quantify the impact on the value changes of each identified factor between each of the valuation dates
• Are adept at explaining complex subjects in a clear and concise manner that triers of fact can understand.

Active Vs. Passive

Calculating APA is not a cookie-cutter activity. While our experts rely upon recognized methodologies, an APA analysis can vary dramatically from venue to venue depending on jurisdictional statutes and case law. We work closely with our engaging counsel to gain direction and insight into the legal parameters that our work must take into consideration in each jurisdiction, which can include shifting burdens of proof and rebuttable presumptions.

Our valuation experts perform the following general steps as part of the APA analysis:

• Valuation at different points in time, including the date of marriage, the date of each gift or inheritance, the date of separation, and the date of distribution.
• Determination of changes in value between each of the valuation dates.
• Identification of factors causing changes in values between each of the valuation dates.
• Quantification of the impact on the value changes of each identified factor between each of the valuation dates.

Contact Us

Our Litigated Business Valuation experts work collaboratively with our Forensic Technology and Forensic Investigation teams to trace assets and liabilities to determine whether those sales proceeds might be reflected in other assets and liabilities at the end of the marriage.

To learn more about our active/passive appreciation analysis services, contact us to schedule a call with one of our Litigated Business Valuation experts.

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