Keep financial oversight when delegating company management

Managers must act within their authority and the company’s interests. An LLC manager may face liability for fraud, misuse of powers or gross error; an unsuccessful commercial decision alone does not establish wrongdoing.

Document bank access, payment limits, approvals for important transactions and responsibility for contracts. Reconcile financial reports against independent records, and avoid making essential company information dependent on one person.

When a manager changes, record the handover of documents, assets, accounts and system permissions. Preserve records obtained lawfully during a dispute, without entering the manager’s personal accounts without authority.

A management agreement does not replace evidence of actual performance. Keep decision minutes, conflict disclosures and explanations for related-party transactions, so a later review can distinguish an authorised commercial choice from an abuse of authority and identify the documents supporting each decision.