Consequences of Running Business in a Proxy

[Adisalman]

It is a common act for business men to run businss in Proxy. This is the act of using representative to act on behalf of the owner. It is sometimes called manager. The Manager manages both assets and liabilities in a business venture to ensure that the business is a success,
There is always an agreement between the owner and the manager as regards the remuneration and other benefits accrued to him as the manager.
The responsibilities of managing the business in the aspect of putting in place adequate internal control and preparation of Financial statement lies with the manager.

Most of the item this kind of agreement are alaways time bound. It may be a contract of like five to ten years. The renewal, evaluation and assessment is usually annual or as the agreenent reads. It is very common in my country because most philantophist are very busy without time to look after thei business

 

[Etini]

If a business would be run on proxy, there should be concrete agreements on terms and conditions for such an arrangement. Most times, these kinds of businesses always turn out to be a drag for ownership between the owner and the manager. No gentleman agreement here. Everything should be documented and a lawyer give legal advice.

And also, be sure that the proxy managing your business is someone that you know personally and can easily trace. It should not be an online thing as people can easily disappear after hijacking your business. At the end of it all, give appropriate supervision to your business even if it is run by a proxy. Use the little free time you have to supervise.

 

[Adisalman]

The fact is that not all business oriented people cannot run the business on their own. Most times they need to seek the hand of a manager who has the capability interms of experience and qualifications to manage such a business, i have seen a philatrophist who stays in diaspora but his business is based in his home town how can such a person manage to look after his business even if he has little time . What is important like i have said earlier is integrity purpose .

It is only the integrity that the person has gained in his previous engagement that can make him qualify for the business as a manager.
However there should be internal control process put in place that can give the business owner the desired assurance that the business is being run as agreed, periodical reports will go a long way to satisfy this.