Power of Attorney and Financial Management Orders

What is a Power of Attorney?

A Power of Attorney (POA) is a legal document that appoints one or more people as an ‘Attorney’, to act on behalf of another person (the ‘Principal’). Depending on the scope of the POA, the Attorney may be able to make financial and legal decisions on behalf of the Principal.

An Attorney may be a family member, close friend, solicitor or trustee organisation. Appointing an Attorney gives that person the legal authority to act on the Principal’s behalf in relation to financial and legal affairs during the Principal’s lifetime. After this time a Will comes into effect.

The Principal may continue to be able to access and transact on their own accounts, so long as they have the decision-making and legal capacity to do so.

An Enduring POA is in place and continues even when the Principal is unable to conduct their own affairs due to impaired capacity.

Where power is given by the principal to the Attorney for a limited time or for a particular task. A General POA can only operate whilst the Principal has mental capacity to manage their own affairs.

Responsibilities of an Attorney

Always act in the best interests of the Principal.

Protect and manage the Principal’s affairs and protect the Principal’s confidentiality.

Avoid conflicts of interests between the Attorney’s interests and the Principal.

Separate the Principal’s property and money from the attorney’s own property and money and not use the Principal’s funds for personal gain.

Keep accurate records of all dealings and transactions carried out on behalf of the Principal.

What is capacity?

Capacity generally means you have the ability to make reasoned decisions and you can understand the nature and consequences of any decision you make. Impaired capacity is when this ability is not fully available.

A qualified healthcare professional can determine if a person has capacity or does not have capacity.

What is a Financial Management order?

A Financial Management Order (FMO) is a legal decision made by a court or tribunal appointing a person/s or organisation to make legal and financial decisions on behalf of an individual who lacks decision making capacity.

An FMO may be granted based on/and not limited to include mental illness or injury, age, brain injury, intellectual disability, dementia, addictions or other disabilities.

Why have someone manage my finances?

Temporarily or permanently loses capacity through illness, injury or disability.

Travelling or living abroad.

Incarceration.

An original or correctly certified Power of Attorney document or Financial Management Order. The document must be certified by an authorised person within your state or territory.

For Power of Attorney documents, they must be correctly executed by all required parties, including the Principal, Attorney(s) and Witness.

Proof of identity documents from all who are not already members.

Any further supporting documents must be provided as required. We may request additional documents depending on the circumstances.

The account holder is required to inform us if the Power of Attorney has been revoked or superseded.

The Attorney is required to communicate changes in regard to the account holder’s capacity.

The Attorney is required to provide medical evidence if the account holder loses capacity to make financial decisions.

The information provided here is general only - for specific and additional information on Powers of Attorney or Financial Management Orders you should always seek independent legal advice.

If you believe an Attorney or financial manager is acting outside of the responsibilities your concerns can be raised by seeking independent legal advice and by contacting us.

Information on Powers of Attorney and the different legislation in each state and territory can be found on the Australian Government Compass website.

For additional information on Financial Management Orders in NSW, visit NSW Trustee and Guardian and for information about Financial Administration in Queensland, visit Queensland Civil and Administrative Tribunal.

If you would like to provide documents or discuss the requirements, please contact us on 13 19 87 or visit your local branch.

This web page is intended to provide general information of an educational nature only. Information on this page is current as at the date of publication. Any links to third party websites are for your information and we do not endorse their content.