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Setting Up Payout Distributions
Payout distributions allow you to set what percentage of the revenue from a billed account is attributed each payee. Then, when an account is billed, the billed amount is split among all the payees according to the designated payout distributions. Those distributions are aggregated and displayed in the Firm Revenue report.
The Firm Revenue report calculates revenue based on billed amount, not on amount paid or reconciled.
Before you run the Firm Revenue report, you will need to set up payout distributions for all accounts, designating which payees should receive the revenue.
For instructions on how to set up payout distributions at the account level, see Maintaining Accounts: The Billing Settings Panel.
For instructions on how to set up payout distributions at the user level, see Manage General and Billing Permissions.
This page discusses why you would set up distributions at each level and the repercussions of doing so.
Payout distributions can be set up at the account level and, optionally, at the user level. In general, your firm will do one or the other, rather than both. Which one you choose depends on how your firm allocates payments.
| Designate Payout Distributions at the Account Level |
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Use if: Your firm tends to allocate revenue to the firm first, then pay out to advisors or others. ExampleA large firm pays advisors a percentage of the revenue generated on accounts managed. The firm is paid first, but the exact percentage split varies by advisor. Some advisors are split the billed amount with the firm and the custodian; other advisors split their management fee with another advisor, the firm, and the custodian.
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| Designate Payout Distributions at the User Level |
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Use if: Your firm tends to allocate revenue to advisors first, with a smaller portion set aside for the firm and others. ExampleA firm has two advisors. The advisors evenly split all revenue, each receiving 48% from all accounts billed. The remaining 4% is reserved for firm expenses.
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To set up account-level distributions:
In User Management, select the Available for Payout Distribution check box, but don't edit the default payout percentages. For more information about user-level payout distributions settings, see payout distributions in User Management.
Assign the desired split at the account level. For more information about setting account-level payout distributions, see Maintaining Accounts: The Billing Settings Panel.
For payout distributions set up at the account level, when accounts are billed, the billed amount is distributed as illustrated in the example below:
To set up user-level distributions:
In the account's payout distribution settings, add the advisor as a User payee and set the payout distribution percentage to 100%. For more information about setting account-level payout distributions, see Maintaining Accounts: The Billing Settings Panel.
Assign the desired split on the user level. For more information about setting user-level payout distributions, see payout distributions in User Management.
For payout distributions set up at the user level, when accounts are billed, the billed amount is distributed as illustrated in the example below:
It is not recommended to use payout distributions at both levels. However, if you do use payout distributions at the account level and the user level, the account billed amount will be distributed first according to the account level distributions, and then according to the user level distributions.
When you set up payout distributions at the account level and user level, when accounts are billed, the billed amount is distributed as illustrated in the example below:
