Annual Budget Planning Checklist

Export the trailing 36 months of P&L by GL account from QuickBooks, Sage Intacct, or whichever accounting system the firm runs on. Match the chart of accounts the budget will be modeled against — re-mapping mid-cycle is the most common reason the variance roll-forward breaks in February.

Lock the calendar: department-head working sessions, CCO review window, managing-partner sign-off, and the date allocations push to department leads. Most RIAs target sign-off no later than mid-December so January fee invoices and comp letters can run on the new plan.

Capture the assumptions the rest of the model will hang on: market return, net-new-asset growth, attrition, average fee yield (bps on AUM), inflation on G&A, and any expected fee-schedule changes. If these change later in the cycle, you only have to update one place.

Roll forward AUM by household tier — typically HNW, mass-affluent, and institutional/retirement-plan — applying the market-return and net-flow assumptions from the kickoff memo. Pull starting balances from Black Diamond, Orion, or Tamarac so the segment cuts match the performance-reporting roll-up.

Apply the firm's tiered fee schedule exactly as disclosed in Form ADV Part 2A — including any breakpoints, householding, and legacy grandfathered rates. Model on average daily balance to match how the custodian debits fees; period-end and period-start methods produce different numbers and routinely cause Q1 reconciliation noise.

Include flat-fee plans, hourly engagements, and project-based work (Social Security claiming analyses, equity-comp planning, tax projections through Holistiplan or FP Alpha). Trend the prior year and ask each lead advisor for committed engagements already on the calendar.

Pull expected sweep revenue, marketing credits, and platform offsets from the Schwab, Fidelity, or Pershing relationship summary. These offsets are net-of-fee economics and need to live on a separate line so the gross fee yield isn't overstated when the board looks at margins.

Walk every GL account with a non-trivial balance and tag it as fixed, variable, or discretionary. Common gotcha: travel and conference spend gets dumped into one bucket and nobody can answer the partner question of which conferences actually drove referrals.

Lease, CAM charges, utilities, cleaning, and any planned build-out. If the lease has an embedded escalator or a renewal option in the budget year, surface it now — landlord renewals often slip past the CFO and become a Q3 surprise.

Get refreshed indications from the broker on E&O, fidelity bond, cyber liability, and D&O. Premiums in the RIA market have moved materially the last several renewals; using last year's number plus 5% is how firms end up under-reserved.

List every vendor contract whose renewal date falls in the budget year — performance reporting, planning software, CRM, archiving, custody back-office add-ons. Anything coming off a multi-year discount is a price-increase risk that needs to be modeled, not assumed flat.

Work backwards from the AUM and revenue plan to the staffing model — typical RIA ratios run 60-90 households per CSA and one paraplanner per two lead advisors. Decide whether to add IARs, associate advisors, or service staff before pricing the comp.

Run each producing advisor through the grid: house vs. personal production, finder splits, succession-track adjustments, and any deferred comp. Capture changes in writing — verbal promises about next year's split are the most reliable source of mid-year partner conflict.

Tie the pool to a stated metric — usually a percentage of revenue over a threshold or net new assets — so payouts are defensible. Include the operations, compliance, and CSA tracks; if the pool is advisor-only, document why and reconcile against retention risk on the service team.

Three or more hires materially changes the spend pattern — recruiter fees (15-25% of base is standard), Series 65/66 sponsorship, U4 filing fees, background checks, and laptop/license bundles. Reserve for two months of overlap with departing staff where transitions are planned.

List every active subscription with seat counts, renewal date, and notice-to-cancel window: CRM (Salesforce FSC, Wealthbox, Redtail), planning (eMoney, MoneyGuide, RightCapital), reporting (Black Diamond, Orion, Tamarac, Addepar), risk (Nitrogen, Tolerisk), and archiving (Smarsh, Global Relay).

Off-channel communications enforcement has driven $2B+ in fines across the industry — budget the email archive, compliant texting (MyRepChat, Hearsay Relate), and social media supervision (Hearsay, Smarsh) at full firm seat count, not at last year's headcount.

If a custodian change has been on the table — e.g., adding Altruist alongside Schwab, or consolidating off Pershing — make the call now. Migration spans 6-12 months and changes nearly every line in the tech budget.

Build a line-item migration estimate: ACATS volume and rejection costs, parallel-run period on reporting platforms, integration rebuild on the CRM, client repapering (DocuSign envelopes), and dedicated PM time. Include a 20% contingency — repapering rejection rates are the line item that always blows the original budget.

Annual ADV amendment within 90 days of fiscal year end, brochure delivery to all clients within 120 days, and any material-change interim amendments. If the firm uses ComplySci, RIA in a Box, or ACA Group for the filing, build their fee plus internal CCO time into the line.

Most firms cycle a mock SEC exam every 18-24 months — budget it in the year it falls. Include outsourced CCO retainer if the firm uses one, plus the surprise-exam fee from the PCAOB-registered auditor if the firm has custody under the SLOA framework.

Annual penetration test, MDR/SOC monitoring, phishing simulation, and the Reg S-P / Identity Theft Red Flags program review. SEC exam staff have leaned heavily on cyber program documentation in recent cycles; underfunding here shows up as exam findings, not just risk.

Set a discrete reserve for unplanned regulatory matters — exam response, rule-change implementation (marketing rule, custody rule, beneficial ownership), and outside counsel hours. A floor of 1-2% of revenue is a reasonable starting point for a firm without recent matter activity.

One-page summary, three-statement model, headcount roster, key assumptions, and a clean variance-vs-prior-year. The partners want to see the deltas, not last year's numbers reformatted.

The CCO needs to confirm the ADV, Form CRS, cyber, mock audit, and contingency reserves match the compliance calendar. CCO turnover or reserve gaps documented before sign-off avoid the awkward Q2 conversation about why a required engagement isn't funded.

Capture the decision in writing: approved as-is, approved with revisions, or sent back. Attach the signed cover memo to the budget folder so future-year auditors and incoming CFOs can see the chain of approval.

Rework the line items the partner flagged, document what changed and why, and re-circulate. Don't bury revisions in a new file — show the delta against the version that was reviewed so the second sign-off is fast.

Push approved budgets into the accounting system, send each department lead their line items with notes on what's funded and what isn't, and schedule the first monthly variance review for week three of the new fiscal year.