Authorized Signor Only: A Comprehensive Guide to the Basics

Introduction

An authorized signor is an individual who has been legally authorized to sign documents on behalf of a company or organization. This authority is typically granted through a corporate resolution or a power of attorney. Authorized signors play a vital role in ensuring the validity and enforceability of contracts, financial transactions, and other legal documents.

Powers and Responsibilities of Authorized Signors

The powers and responsibilities of authorized signors vary depending on the scope of their authority. However, some common responsibilities include:

• Signing contracts and agreements
• Executing financial transactions
• Approving expense reports
• Authorizing the issuance of checks
• Filing tax returns

Authorized signors are required to exercise their authority in a responsible and ethical manner. They must ensure that they understand the terms of any document they sign and that they have the authority to bind the company or organization to the agreement.

Consequences of Unauthorized Signatures

If an individual signs a document without proper authorization, the document may be considered invalid or unenforceable. This can have serious consequences for the company or organization, as well as for the individual who signed the document.

In some cases, unauthorized signatures can also lead to criminal charges. For example, if an individual signs a contract without authority and then fails to perform the obligations under the contract, they may be charged with fraud.

How to Become an Authorized Signor

To become an authorized signor, an individual must be appointed by the company or organization. This appointment can be made through a corporate resolution or a power of attorney.

Corporate Resolution

A corporate resolution is a formal document that is adopted by the board of directors of a company. The resolution typically specifies the powers and responsibilities of authorized signors and who is authorized to sign on behalf of the company.

Power of Attorney

A power of attorney is a legal document that gives one person the authority to act on behalf of another person. A power of attorney can be used to grant an individual the authority to sign documents, handle financial transactions, or make other decisions on behalf of the principal.

Verification of Authorized Signors

It is important for companies and organizations to verify the authority of authorized signors before accepting any documents that they have signed. This can be done by requesting a copy of the corporate resolution or power of attorney that grants the individual the authority to sign on behalf of the company or organization.

By following these guidelines, companies and organizations can help to protect themselves from the risks associated with unauthorized signatures.

Conclusion

Authorized signors play a vital role in the operation of businesses and organizations. By understanding the powers and responsibilities of authorized signors, companies and organizations can help to ensure that their contracts and other legal documents are valid and enforceable.