As a business owner, you may have involved your spouse in some fashion in your company. If you are facing divorce, your spouse may want to claim some of the value of your business. This is where the financial records of your business may make or break your operation.
If your spouse lays a claim to too much of the value of your business, you may have to sell the business to pay off your spouse. As Forbes explains, you might determine how much value your spouse should actually receive through the financial records of your business.
During the start up of your business, you probably invested capital to pay for a building and to furnish and equip it. Consider checking your records to establish that your capital consisted of only assets that you owned and not money contributed by your spouse. Also check to see if you had invested any money from a marital account. This may help disprove any claims that your spouse had something to do with building your business.
You also want to establish that you did not use business assets to pay for personal expenses. For instance, instead of using your regular income to pay for a new car or repairs to your home, you might have used business assets instead. Commingling your business and personal funds could cause your business to come under greater scrutiny from a divorce judge.
Pay attention to how much you paid your spouse if you ever employed your spouse. Check to see if you had paid your spouse a salary consistent with market standards. If you had paid your spouse too low a salary, your spouse might argue that his or her work for your company merited a higher amount. A judge may decide to award your spouse a greater amount of your business equity as a result.