Power of attorney given to accountant

Power of attorney given to accountant

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my client wants to sign power of attorney over to me as he is very ill (going into hospital to have a major operation) and is reluctant to sign it over to his son (who is currently running the business.).

I do not want to have this power of attorney, and don't think I could ethically take it anyway? could I?, but with no other family members who he is willing to sign this over to, is his only bet a lawyer or solicitor? Does anyone know how much they would roughly charge for this service? My client signs cheques, and is obviously the only account holder, for the business, and although son runs the business, he is not given any control over the finances. so as accountant, I would be in contact with the POA probably once a week for the issue of cheques.
Anon

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David Winch
By David Winch
04th Jun 2007 12:16

Care!

I would suggest as a first step you should check with your professional body whether you have the requisite authority to control a client's bank account as sole signatory on cheques (for example, does the money in the account become "client money" in these circumstances and are you authorised by your professional body to hold "client money"?).

Secondly check whether your professional indemnity insurance is adequate to cover this (i.e. in scope, not the amount). Talk to your insurers / brokers. PI insurers get understandably nervous about you controlling someone else's bank account as sole signatory! (How about you and the son acting as dual signatories, both signing each cheque?)

Thirdly ask yourself whether you have any concerns about tax evasion or other criminal conduct by the client. If you do, then you need to obtain consent from SOCA to control the account as it may hold proceeds of crime.

Aside from regulatory issues, how would you satisfy yourself before signing each cheque? Would you ask to see, for example, suppliers' invoices before signing?

Presumably the power of attorney would be drawn up by a solicitor and be an enduring PoA rather than a 'normal' one.

What is to happen if the client dies?

David
www.MLROsupport.co.uk

P.S. I am assuming this is not an audit engagement.

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By stevepett
19th Nov 2010 08:54

PoA

A lawyer would charge twice as much as you and know nothing about the business, so you would be doing him a favour to take the appointment.

Don't forget that an ordinary Power of Attorney lapses if the client loses the ability to make decisions and then only a Lasting Power of Attorney Property and Affairs can legally be used, and it takes 3 months to create and register one so it can be used.

Nasty situation which needs resolving if the business is to survive!

 

Stephen Pett 

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