Duty of care,
Definition of Duty of care:
Duty of care refers to a fiduciary responsibility held by company directors which requires them to live up to a certain standard of care. This duty—which is both ethical and legal—requires them to make decisions in good faith and in a reasonably prudent manner. These people are required to exercise the utmost care in making business decisions to fulfill their fiduciary duty.
The responsibility or the legal obligation of a person or organization to avoid acts or omissions (which can be reasonably foreseen) to be likely to cause harm to others.
Duty of care is owed by an accountant in correctly preparing a companys accounts, by an auditor in confirming an companys financial statements correctly present its financial position; by a director to shareholders in husbanding the enterprises resources; by a manufacturer to consumers for the safety of product; and by every party to a contract to the other contracting parties. See also standard of care.
Duty of care is often an implicit responsibility that comes with being a company director, but it may also be part of a written contract. This duty requires them to make decisions that are financially, ethically, and legally sound. These decisions should be made after taking all available information into account. Directors must act in a judicious manner that promotes the company's best interests.
How to use Duty of care in a sentence?
- If you are liable with the duty of care then you must make sure that nothing bad happens to anything.
- Duty of care is a fiduciary responsibility held by company directors which requires them to live up to a certain standard of care.
- The duty of care was on the shoulders of one man and he fulfilled his duty with great care and it impressed all of us.
- The duty requires them to make decisions in good faith and in a reasonably prudent manner.
- Failure to uphold the duty of care may result in legal action by shareholders or clients.
- My accountant didnt adhere to his duty of care in handling my accounts. Ill be taking him to court to attempt to recoup the losses he caused me.
- The duty of care also applies to other roles within the financial industry including accountants, auditors, and manufacturers.
Meaning of Duty of care & Duty of care Definition