Delegation of Authority Matrix
Who may approve what, up to what value, and on what conditions.
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| Policy owner | [owner] |
| Effective from | October 14, 2026 |
| Next review | [date] |
1. Authority limits
| What | Who may approve | Limit | Conditions |
|---|---|---|---|
| [add one line per approval] |
2. Standing rules
[the rules that apply whatever the amount]
3. Splitting
A commitment may not be broken into parts to bring it under a limit. Where a series of orders forms one commitment, the limit applies to the whole.
What is a Delegation of Authority?
A delegation of authority document says who may commit the organisation to what: which roles can approve which types of transaction, up to what value, and on what conditions. It matters because authority that is assumed rather than written produces two failures — spending nobody approved, and decisions that stall because everyone believes someone more senior has to sign. The matrix removes both by naming the limit and the holder.
Finance and company secretarial teams maintain it and boards approve it. It is used for purchase orders, supplier contracts, recruitment and salary changes, capital expenditure, credit notes, write-offs, bank payments, legal settlements and the signing of agreements. Schools, charities, NGOs, public bodies and group companies with subsidiaries all keep one, often because a funder, an auditor or a regulator asks to see it. In daily use its heaviest readers are approvers checking whether a request that has landed with them is theirs to sign.
What the board may delegate, and what it may not, comes from the constitution — articles of association, bylaws, trust deed or the equivalent — and the companies or charities legislation where you are established. Some transactions require board or member approval above a threshold regardless of any internal matrix, including certain related-party and substantial asset transactions, so check the applicable provisions and your own articles. Banking mandates are separate again and are agreed with the bank. Public bodies and grant recipients usually have financial regulations or funder conditions that override internal preference.
The matrix is internal. It does not limit what a third party may rely on: someone who appears to outsiders to have authority can still bind the organisation, which is why signing rules matter as much as approval limits. It does not create a budget either — approving within limit is not the same as having funds available — and it is not a bank mandate. Finally, it cannot authorise anything unlawful or outside the constitution, since an internal limit cannot expand what the organisation may lawfully do.
What to put in a Delegation of Authority
These are the details this template asks for. Anything left blank is marked in red on the preview so you can see what is still missing.
| Field | What goes in it |
|---|---|
| Issuing organisation | For example: Maple Grove Homeowners Association |
| Organisation address | For example: 1420 Kinnear Road, Columbus, OH 43212 |
| Policy owner | For example: Head of People |
| Next review | Free text |
| Authority limits | One per line: What | Who may approve | Limit | Conditions |
| Standing rules | For example: Nobody approves their own expense claim. Nobody approves a payment to a company they have… |
| If the policy is not followed optional | For example: Unapproved absence may be treated as unauthorised and dealt with under the disciplinary… |
How to write a Delegation of Authority
List transaction types before setting values
Start with a column of the things people actually approve: purchase orders, non-catalogue purchases, new supplier onboarding, contracts and renewals, headcount, salary changes, expenses, customer credit notes, bad debt write-offs, capital spend, payments released at the bank, legal settlements, public statements. The gaps are where the trouble lives. Most matrices cover purchasing well and say nothing about who may write off a debt or settle a claim.
Define what the number means
'£25,000' is ambiguous until you say per what. Fix the basis for every band: per transaction or per annum, per contract or total contract value including option periods, exclusive or inclusive of tax, and in which currency with what conversion rule. Then add an anti-splitting rule, because the oldest workaround in procurement is three orders of £8,000 to stay under a £10,000 threshold.
Require a second name above the risk line
Set the level at which one signature stops being enough, and require two people from different functions — typically the budget holder plus finance. Apply the same principle to payments: whoever sets up a new supplier bank account should not be the person who approves the payment to it. That single separation stops most invoice redirection fraud, and it costs nothing to write down.
Write the conditions attached to each limit
Authority is rarely just a number. Record the conditions: within approved budget, standard terms only, competitive quotes above a stated value, legal review for any contract with an indemnity or an automatic renewal, data protection review where personal data is processed. State what happens when a condition is not met — it escalates one level — so the approver has a rule to follow rather than a judgement call.
Cover absence, acting-up and revocation
Say what happens when the approver is away: whether authority passes to a named deputy, whether it moves up rather than sideways, and whether a temporary delegation must be in writing and time-limited. Add the rule that authority attaches to the role, not the person, and ends immediately when they leave it. Then date the version, name the approving body, and set a review cycle.
Common mistakes
- Writing thresholds without saying whether they are per transaction or annual, so the same supplier is approved twelve times over by someone never meant to approve the total.
- Omitting an anti-splitting rule, which turns every threshold into a target to be worked around with smaller orders.
- Giving the same role both payee setup and payment approval, leaving no separation of duties on the control that fraud most often attacks.
- Naming individuals instead of roles, so the matrix is out of date the day someone leaves and approvals get signed by people with no current authority.
- Never reconciling the matrix against the bank mandate and the system permissions, so what the policy says and what the software allows are two different things.
Frequently asked questions
What is a delegation of authority matrix?
A table with transaction types down one side and roles across the top, showing the maximum value each role may approve for each type, plus any conditions attached. It usually sits with a short policy explaining the basis of the figures, the escalation route, what happens during absence, and who may vary it. Most organisations publish it as one page plus notes.
Who approves the delegation of authority?
The board or its equivalent governing body, because the authority being delegated is theirs to begin with. The chief executive or finance director typically proposes it and maintains the detail. Changes to the top bands normally return to the board, while smaller administrative changes are often delegated to the finance director within a range the board has set. Record which route was used.
How often should a delegation of authority be reviewed?
Annually, and immediately after a restructure, an acquisition, a new subsidiary or a change of banking arrangements. Reviewing it after an audit finding or a near-miss is also worth doing while the example is fresh. The practical test is whether every role named still exists and every threshold still makes sense against current transaction sizes.
What is the difference between delegated authority and signing authority?
Delegated authority is internal permission to commit the organisation to something. Signing authority is who may put their name on the document that binds it externally, which may be restricted to directors or specified officers under the constitution. The two should line up, but they are not the same, and an internal approval does not by itself make a signature valid.
Does a small company need a delegation of authority?
Once more than one person can spend money, yes, even if it is half a page. It becomes urgent when you take on staff who order supplies, hire a bookkeeper, or bring in outside investment, since investors and auditors will ask for it. Keep it proportionate: three or four roles, a handful of transaction types, and a clear rule about who signs contracts.
This page explains general practice and is not legal advice. Requirements differ between countries and, in some cases, between states — check what applies where the document will be used.