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Understand Your Legal Commitment As A Daycare Director
Are you aware of your legal commitment as a director of
a daycare? Do you know that, as a day care director, there are certain code of conducts that you should be adhering to when
conducting your daycare business? Do you know
what your duties are as a daycare director of your daycare business? Many business owners are unaware of the legal implications
of being a director of an establishment. Whilst understandably, many of us are not legal professionals, it is important to
know what’s required of you as a daycare director so that you can make a conscious effort to stay away from situations
which could potentially put you in conflict with your duties as a day care director. A director’s duties can be categorized broadly as:
• Fiduciary Duties
• Duties
of skill, care and diligence
• Statutory Duties 1) Fiduciary Duties - A daycare director is required to act in genuine interest of the day care business' interest at all times
As a daycare director, he is required to act honestly and conduct due diligence when discharging his duties as
a day care director. Should a daycare director be forced to make a decision or undertake a transaction which may seem unviable
or disadvantageous for the daycare business, he must be able to justify other intangible benefits for daycare business; either
to the day care business as a corporate entity or its group of company, the members and employees in the daycare business
or the interest of the creditors in the daycare business.
- A daycare director must avoid positions where
his personal interest may be in conflict with his duty
A day care director must ensure that he acts in the
best interest of the daycare business at all times and not be in a position where his personal interest will impair his
judgment resulting in a situation where his personal interest take precedence over the daycare business' interest.
- Duty to use powers for proper purposes and not for any collateral
purpose
A daycare director must understand that he is the trustee of the day care business' assets and the
business assets entrusted to him are to be applied for the business' purpose and interest. It is considered a breach of
fiduciary duty should the day care director misapply the business' assets or abuse his power. Even if he was misguided
on what was in the daycare business' interest, the daycare director is still in breach of his duty should be misuse his
powers. And should he misapply the daycare business' funds, he is in breach of criminal breach of trust, be it or not
he has personally benefited from it. A daycare director must not accept any form of reward or payment from any third party
other than his day care business.
2) Duties of skill, care and diligence A daycare director must ensure that he exercise reasonable care and skill when undertaking his daycare
director responsibility with any additional knowledge and experience which he actually has..
3) Statutory Duties
A daycare director’s breach of statutory duty can be a civil breach rendering the day care
director liable to the day care business for any profit made by him or for any damage suffered by the business or a criminal
offence. - Duty
to disclose certain important information
A daycare director is bound to disclose certain information to the
company such as interest in a proposed or existing transaction or arrangement with the daycare business or loans to director,
etc. The type of information that a daycare director is required to disclose can vary slightly from country to country and
state to state.
- Duty to ensure that the accounts are properly
prepared
It is the day care director’s duty to ensure that the accounts of the day care business are
properly prepared and managed. The accounts should provide a true and fair view of the state of affairs of the day care
business and explain its transactions.
In
essence, it is important to note that a day care director's duty to the company is an important one. He must at all times
act with care, honesty and diligence and make decisions which are in the best interest of the daycare business and not oneself.
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