End of Year Financial Checklist for Brokers

Running a brokerage means keeping track of a fast-moving business. Between commissions, payouts, lead costs, admin work, and all the small expenses that slip through the cracks, it is no surprise that the financial side of the business can get messy during the year. The end of the year is your chance to slow down and make sure your numbers tell a clear and accurate story before you move into the new year.

The financial checklist for brokers is designed whether you're in real estate, mortgage, and insurance brokers. It focuses on the areas that impact your margins the most and helps you step into January with confidence and visibility.

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1. Make Sure Your Books Are Clean

If your transactions are not categorized correctly or if your records do not match what actually happened in the business, every financial decision you make later will be based on bad data. Take time to review your income and expenses, check that payouts align with your CRM, Agency Management Software (AMS), or Loan Origination System (LOS), and ensure that marketing and lead costs are tied to the right people or teams. Even simple errors, like a missed fee or an uncategorized deposit, can throw off your profitability metrics.

This cleanup work is not glamorous, but it gives you a solid foundation for every analysis that comes next.

2. Reconcile Commissions and Payouts

Commissions are the core of any brokerage, and year-end is the best time to confirm that everything lines up. Review every closed deal to make sure the commission income matches your system of record, and that agent or loan officer splits were paid correctly. 

If you use more than one system, such as a CRM paired with an LOS or a transaction management tool, pay close attention to any discrepancies between them. Reconciling now helps avoid payout disputes later and gives you a dependable picture of each person’s true financial contribution.

3. Review Your Pending Pipeline

Your year-end numbers do not tell the whole story unless you look at what is still in motion. Real estate escrows, mortgage loans that are locked but not funded, and insurance policies awaiting underwriting all carry revenue that will hit early next year. Taking time to review your entire pipeline helps you estimate what Q1 might look like and reveals whether you need to adjust staffing, marketing, or cash reserves. 

4. Understand Profit per Agent or Loan Officer

Once your books and commissions are cleaned up, shift your focus from volume to profitability. High production does not always mean high profit. Some agents or loan officers may generate strong results with very little support, while others require more marketing dollars, more admin time, or higher splits to close similar volumes.

Create a simple profitability picture for each person on your team. Look at the revenue they generated, the direct costs tied to their work, and a reasonable share of overhead, such as software, admin payroll, or office rent. What remains is their true profit contribution. This view helps you understand who is driving your margins upward and where efficiency might be slipping.

5. Review Marketing and Lead Performance

Most brokers spend heavily on leads and marketing, yet few take time to measure what actually worked. Year-end is a great time to compare how each lead source performed. Look not only at spend but also at close rates and the quality of clients each channel produced. Mortgage and insurance brokers, in particular, benefit from calculating the actual cost per funded loan or cost per written policy. 

When you understand which marketing dollars delivered real results and which ones fell flat, you can plan next year’s budget with much more precision.

6. Look at Cash Flow Patterns Throughout the Year

Brokerages often feel the ups and downs of seasonality. A few strong months can make you feel like you are on top of the world, while a slow stretch can create more stress than it should. 

Reviewing your cash flow across the entire year helps you spot trends. You may notice predictable slow months, seasons when expenses spike, or gaps between closings and payouts that strain your reserves. Understanding these patterns gives you the insight to plan ahead rather than react.

7. Update Contractor Documentation and 1099 Information

Since most brokerages work with independent contractors, year-end is a good time to make sure your records are complete. Start by confirming that you have up-to-date W9 forms for every agent, loan officer, or processor. Then review total payouts so you know who has crossed the 1099 reporting threshold. This preparation does not involve filing the 1099s, but it ensures your books support a smooth tax season and prevents January from turning into a scramble for missing paperwork.

8. Revisit Compensation Structures

With a full year of data in front of you, you can take an honest look at whether your compensation model still works. Ask yourself whether your current splits protect your margins, whether high performers are rewarded appropriately, and whether certain teams or branches need a different structure. Even small adjustments can make a major difference in profitability when you review the numbers holistically instead of relying on intuition.

9. Review Your Software and Tools

Most brokerages pick up new tools throughout the year, usually with good intentions. CRMs, LOS systems, marketing platforms, dialers, and multiple subscription fees can add up quickly. Year-end is the perfect time to check whether your team still uses everything you are paying for. Removing unused seats or redundant tools can save thousands of dollars without affecting your operations at all.

10. Prepare the Reports You Will Rely On Next Year

Once everything is updated and reconciled, take time to generate the reports that will guide your decisions throughout the new year. Monthly financial statements, profit reports by LO or agent, marketing performance summaries, and cash flow reports all give you clarity and support better decision-making. The goal is to start January with visibility, not guesswork.

Final Thoughts

A thoughtful year-end review does more than tidy up your books. It gives you a clear understanding of how your brokerage performed, highlights areas that need attention, and helps you build stronger systems for the year ahead. When your numbers are clean and your reports are meaningful, you can lead your team with more confidence, make smarter financial decisions, and grow in a sustainable way.

If you would like help building clean bookkeeping systems or setting up financial reports that actually make sense for a brokerage, reach out to Bookkeeping for Brokers. 

We help real estate, mortgage, and insurance firms build accounting systems they can rely on year-round.