Using Authorized Signers for Your Business

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Katie Fleming

Co-founder and COO of Owner Actions

One of a business's authorized signers prepares to sign a contract

As your business grows, you may need some assistance navigating the everyday tasks of operations, including signing checks, paying bills, and handling your business’s banking needs. One way to find support is by naming one or more authorized signers who can act on your business’s behalf.


What are authorized signers?

An authorized signer is a person the company empowers to sign documents on its behalf.

In some cases, authorized signers have full authority to sign legal and financial documents. This gives them the power to open and close accounts, execute orders, and agree to contracts that bind the business. In other instances, the power of an authorized signer is limited so they can sign specific documents, oversee specific transactions, or act on behalf of the business with a specific set of accounts.

Often, owners, partners, or specific executives of a business have full authority to sign documents and transact for a business. Many then grant their CFO or in-house accountant authority to sign checks, manage or take on loans, and execute other financial documents. They might also assign their in-house attorney the power to execute contracts and agreements, perhaps after following a specific protocol.


Are there risks to naming authorized signers?

There are some risks. When authorized signers have access to your business’s accounts, there is an increased risk for fraud and inappropriate withdrawals. And when signers can bind the business to contracts, the business may have few options but to complete the terms agreed upon.

Legal recourse is an option, but it isn’t a guarantee that you’ll recover the money you’ve lost from wrongful acts. By starting sooner in the process, with protocols to reduce your risks, you’ll be better positioned to protect your business. One way to do this is to set up an audit system. Here are some ideas for getting started:

  • Implement a process of verifying transfers, withdraws, and invoice payments.
  • Work with your bank to block large dollar-value transactions by requiring more than one person’s signature.
  • Establish protocols to ensure more than one person reviews and approves the documents before they’re executed.


How do I name authorized signers?

You can name an authorized signer in your business’s operating agreement. An attorney can help you create this document or amend the one you currently have in place to include a new signer for your business.

Need help finding an attorney? Consider working with Contract Counsel. Check out their website here.

Want to learn more about working with an attorney? Check out this article:


If your business doesn’t have an operating agreement in place, you (and, if applicable, other owners of your business) can draft an agreement that either names a person or empowers a person holding a specific role within your business the power to serve as a signer on its behalf. Every person with an ownership stake or voting right in your business should sign this agreement to indicate their approval.

With your agreement in place, you can provide documentation to your bank and other entities to confirm the signer’s authority to act on your business’s behalf. Keep in mind that you can rescind this right at any time.


What’s next?

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