A Power of Attorney is a legal document that gives someone power of attorney to act on behalf of the company. Typically, the instrument of attorney carefully details the transactions and acts for which the person is being granted power of attorney, rather than providing a general mandate that would allow the agent to act with complete freedom.

A power of attorney gives legal powers to a person acting as an agent. For a business, this authority may include the ability to access financial accounts, sell or place new orders in securities, and write checks, although the agent may also perform a number of other activities to keep the business going. For security reasons, a POA document should strictly restrict the agent's activities or access to specific accounts.

Powers of attorney can be exercised in the ordinary course of business or only in certain circumstances - for example, when the business owner is incapacitated or does not have access to the business accounts.

Pros and cons of POA authorization
The main benefit of having a Power of Attorney for a business account is that it gives you the security of a backup in the event that the business owner or other authorized persons are unable to perform their duties. Authorizing a representative to act on his behalf prepares the company for any unexpected situation and allows important business decisions to be made in a timely manner. If the owner of the business has not given anyone any legal authorization, there is always a risk that at some point he or she will be unable to make important business decisions or conduct essential transactions, which can result in tremendous damage to the business and its reputation. Not having an authorized representative can result in not paying salaries on time, not servicing business loans or mortgages, not paying third-party vendors, and losing potential contracts.

The benefit of being able to authorize someone to act on behalf of the account holder comes with the need to be sure you can trust the authorized agent with access to your business account. Therefore, we strongly advise you to think carefully before granting someone a POA and giving them access to a bank account and the ability to make important business decisions. The person you nominate as an agent has uncontrolled access to Company funds, which may result in an increased security risk if the nominee is acting in interests other than those of the Company