Delegation of Authority

1. Purpose

Loyalist College delegates its signing authority to its employees for the purpose of carrying out the ordinary course of business of the college. The purpose of this policy is to clarify the roles and responsibilities within Loyalist College’s delegated authority framework to ensure transparent processes for financial transactions and externally binding documents, agreements, and contracts that are properly reviewed, analyzed, and authorized.

2. Application

This policy applies to the President and CEO, and all employees of the college who initiate, administer, or manage the variety of financial and non-financial contracts that Loyalist College commits to. This policy applies to all contracts, amendments, and renewals that Loyalist College enters, and all invoices paid by Loyalist College.

3. Definitions

Contract Signing Authority: The employee who has been assigned the authority from the President and CEO to commit Loyalist College to a contract.

Contract: Any written agreement, contract, subcontract, letter of intent, letter of agreement, letter of understanding, memorandum of understanding, memorandum of agreement, lease, licence, donor agreement, deed, grant, certificate, instrument, assignment, obligation, or any other document which creates an obligation or binds the college.

Delegate: The employee that has been delegated authority by Loyalist College, as granted under this policy.

Delegated Authority: The process of entrusting responsibilities and decision-making powers from one individual to another within an organization.

Delegator: In the instance of a further delegation of authority for a temporary period or for an authorized designate, the delegator is the employee that holds permanent authority that they will entrust in another employee for a specified time or up to a maximum level.

Designate: An employee who has been delegated authority to sign contracts, approve purchase requests, and approve invoices up to a maximum of $10,000.00.

Employment Contract: A contract for an employment appointment to a full time, part time, or contract position for any amount of compensation, including new appointments, transfers, or promotions.

Financial Authority: Employees with authority delegated to them by the college to approve financial transactions or purchase goods and services.

Legal Document: A document entered between at least two parties that creates an obligation, legal commitment, or undertaking on behalf of the college. Legal documents include but are not limited to, a written agreement, a revenue-generating or expenditure contract, an agreement to purchase or sell, funding proposals, a letter of intent, a transfer, an engagement, or any other document that may bind the college.

Segregation of Duty: An internal control requirement designed to prevent errors and deter fraud by ensuring that no one person has sole control over initiating, recording, and approving (authorizing) a single transaction of a certain level and degree of risk.

4. Policy Statement

Delegated authorities within Loyalist College are determined by an employee’s position within the organization and apply to contract signing authority and financial authority. All college employees and persons acting on behalf of the college share in the overall stewardship of financial resources and each person has a responsibility to understand and comply with the college’s methods of internal control.

Employees are not authorized to sign or approve contracts that create an obligation or undertaking on behalf of Loyalist College unless the individual has the authority to do so.

5. Assignment of Authority

5.1 Appropriate authority is required for an employee to commit Loyalist College to expenditures or other contractual obligations, to authorize payments, and to transfer and/or assign securities.

5.2 Authorities and segregation of duties in instances of multiple signing and financial authorities have been formally outlined for employees within Appendix A Delegation of Authority Matrices.

5.3 Outside agents may dictate alternative arrangements for authorities. However, even when such agreements decrease financial and/or contract signing authority below what is contained within this policy, the college policy prevails.

5.4 If an employee changes position, their signing authority will change to align with their new role.

5.5 Employees appointed into an acting position (whether appointed to cover a temporary leave or for an extended period), are granted the authority of that position to review or execute binding contracts. It remains the responsibility of the employee to understand the implications of their temporary approval authority.

5.6 When employees end their employment with the college, their signing authority will be cancelled by their effective departure date.

5.7 The college may rescind the signing authority of an employee at any time when it has been deemed necessary, without disclosure of cause.

5.8 An employee who violates the terms of their delegated authority will be subject to investigation, which may result in disciplinary action.

6. Delegation of Authority

Financial and contract signing authorities may be delegated further on a temporary basis or to an authorized, assigned designate. All assigned delegations must be documented correctly for the Finance Department.

6.1 Temporary Delegation of Authority

An employee may temporarily transfer their delegation of authority to another employee during an absence. An employee may only delegate their authority to another employee who holds a management position.

A temporary delegation of authority must be in writing and fully documented on Appendix C Temporary Delegation of Authority Form and submitted to the Finance Department upon completion.

6.2 Authorized Designate

An authorized designate is an employee who has been given authority to sign contracts, approve purchase requests, and approve invoices up to a maximum of $10,000.00. Where authority is given to a designate, responsibility remains with the delegator named within this policy.

Written notice to the Finance Department using Appendix B Designate Form is required.

7. Financial Authority

Financial authority applies to all financial transactions within specified approval limits.

An employee with financial authority is responsible for ensuring that:

• Sufficient funds are available in the unit’s budget and/or funding project to cover the expenditure.
• If funds are not available, evidence of approval has been obtained to overspend from the applicable authorization level.
• The spending adheres to all applicable college policies, including FIN 200 Procurement Policy and FIN 504 Business Expense Reimbursements, Travel and Hospitality Policy, and if applicable, complies with the terms and conditions of any granting agencies, external sponsors and/or donors.
• A contract or transaction commitment has not been reduced to avoid exceeding an employee’s approval limit. Examples of these types of reductions may include dividing projects, procurements, and/or contracts to decrease overall signing amounts or awarding multiple consecutive purchases to the same vendor.
• The expenditure is incurred for the purpose described.
• The goods/services have been adequately received.

8. Contract Signing Authority

Signing authority applies to all agreements and contracts that legally bind Loyalist College to financial and/or non-financial commitments.

The authority to approve lease agreements is limited to the President and CEO and the Senior Vice-President, Corporate Services and CFO.

Contract signing authority for legal services is limited to the President and CEO, the Senior Vice-President, the Corporate Services and CFO, and the Vice-President, Human Resources. These employees must be consulted prior to legal engagement.

If a contract requiring execution is not specifically identified in Appendix A Delegation of Authority Matrices and if the appropriate level for the contract is not immediately recognizable, the signing authority will be determined by the Senior Vice-President Corporate Services and CFO. The signing of purchase orders and associated documents are subject to FIN 200 Procurement Policy.

Contract Signing Authority Responsibilities

The employee with contract signing authority is responsible for ensuring that:

• The college can meet its obligations resulting from the contract.
• No evidence exists that the contracting party will default on its obligation to the college.
• The benefit of the contract to the college is clear and demonstrable.
• The contract complies with all labour legislation, collective agreements, tax legislation, or other applicable legislation and regulatory requirements, and all applicable college policies.
• Any required consultations, reviews, or approvals have been completed before the contract is signed.
• Any risks and liabilities presented by the contract have been addressed. Any proposed contract, which presents as an unusually high level of risk, or the nature of which might be reasonably seen to have an adverse effect on the college beyond its normal day-to-day operations, must be brought to the attention of the next signing authority prior to the execution of the contract.
• Their signing activities do not represent an actual, potential, or perceived conflict of interest in compliance with ADMIN 107 Conflict of Interest Policy. If an employee believes they may have a conflict of interest regarding any document to be signed, they are required to obtain guidance from the President and CEO or the Senior Vice-President, Corporate Services and CFO prior to signing and executing the contract.

9. Monitoring and Internal Controls

Internal Reviews

Documents must be reviewed to ensure the integrity of personal and/or confidential information and to ensure that there is an acceptable level of risk and appropriate insurance coverage.

In situations where the President and CEO or the Senior Vice-President, Corporate Services and CFO believes it would be in the college’s financial or reputational interests to do so, they may require a review of the management and compliance of any contract. College employees are expected to provide any support necessary to successfully conduct and complete these review activities.

10. Non-Compliance

Incidents of non-compliance with this policy must be referred to the Senior Vice-President, Corporate Services and CFO. Non-compliance may result in disciplinary action up to and including termination. College community members should report instances of negligent, improper, or gross mismanagement of any funds and/or any serious, willful, and flagrant breaches of guidelines or Loyalist College policies, procedures, or regulations as per the college’s ADMIN 117 Whistleblower Policy. 

11. Related Documents and Links

• FIN 507 Delegation of Authority Appendix (A) Delegation of Authority Matrices
• FIN 507 Delegation of Authority Appendix (B) Designate Form
• FIN 507 Delegation of Authority Appendix (C) Temporary Delegation of Authority Form
• ADMIN 107 Conflict of Interest Policy
• ADMIN 117 Whistleblower Policy
• FIN 200 Procurement Policy
• FIN 200 Procurement Procedure
• FIN 504 Business Expense Reimbursement Policy