Active Partner
A person who takes an active interest in the conduct and management of the business of the firm is known as an active or managing partner. This name refers to a partner who has capital in the business and takes part in the management of its affairs. He is a partner who works in a company that is a partnership. He carries on the daily business on behalf of all the partners. He is also known as an ordinary partner or a managing partner. It is an invested person who is involved in the daily operations of the partnership. This person typically shares more risk and return versus a limited or silent partner. He is a senior person who owns a company with other people and does practical work relating to running the company. In some arrangements, each partner takes a defined role, such as sales, marketing or production. He helps run the business to boost in ways to maximize his or her returns and this person generally shares a lot of risks and returns compared to a general partner. Hence when an active partner wishes to retire from the firm he must give public notice about the same.
They help run the business to enhance his or her returns and are therefore considered a material participant. This means he acts as an agent of all the other partners on a day to day basis and with regards to all ordinary business of the firm. For example, an active partner may have an executive or directorial role at the company and their performance can have a direct effect on the business. He participates in the management meeting and discusses with the other partners on business review and the action plan of the business for the ensuing period. An active partner often has unlimited liability in case the company fails. If one partner causes problems, either by accident or through fraud, the other partners might be liable for any damages.
