If you own a business that you have built from the ground up, it is likely your passion and a big part of your life. Like many other business owners, you may be going through a difficult time when you cannot be sure of what is going to happen in the near future. If so, it might be time to protect yourself and your business by assigning a Company Power of Attorney (POA).
If you, as the director or owner, became unable to make decisions regarding your company due to absence or illness, it could place the company in turmoil. This can also occur if there are two directors, and prior to the absence of one of them, a company POA was not appointed. The type of POA needed in this situation is referred to as an ‘Enduring Power of Attorney’ as they step in and can make important decisions regarding key documents, cheques and payroll. These factors, if left unchecked, can put a business at serious risk and effect earnings.
It is important to note that if your business operates in multiple states, you may be required to file an independent POA document for each of those states, as the legislation around the POA entitlements may differ between them.
Other Titles of POA
The other two forms of POA are ‘Limited Power of Attorney’ and ‘General Power of Attorney’. These two appointments of POA exist to assist the business in less serious matters alongside the acting director rather than to take over in a situation of emergency.
It is imperative that you have a chosen POA prior to any unfortunate situation that could leave you unable to manage your business. Think about what would happen if no one could sign documents, authorise transactions or sign off on payroll. You may only be incapacitated for a short period of time but that time could be enough to leave your loyal employees in the dark and set your business back years.
Criteria when appointing a Company of Attorney
When appointing a POA, the criteria is that they must be of legal age (18), mentally sound to make free choices and the POA documents must be signed by the director and not a current acting POA.
Who could you trust your company with and who would be able to take care of things if you were gone? It is a good investment of time to have a think about it before the unthinkable happens.
If you want to know more, contact us at Wills & Estates on 1800 22 33 90.
We can help you clarify your options and help you get set up.
We offer no cost, no obligation initial appointments so that you can find out where you stand and exactly how much it will cost you to get your POA, Will and/or Estate Plan set up. We offer fixed fees and payment plans; your wishes, your way.
Don't wait until it's too late, contact us today!
References ‘Power of Attorney’, SA.GOV (Web Page) < https://www.sa.gov.au/topics/family-and-community/planning-ahead/power-of-attorney-and-advance-directives>.  Ibid