Implementation guide · IB Commission Operations
Revenue Share: Defining Gross and Net Commission Bases
Define the revenue base before calculating an IB share. Reconcile eligible revenue, agreed deductions, negative periods and a worked example.
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Published by FxTrusts, a supplier of brokerage and prop firm technology. Prepared with AI-assisted research and drafting; reviewed against the cited public sources. Examples are illustrative. Product links describe our services.
Quick answer
Revenue share is an agreed percentage of a defined revenue base. Gross revenue, net revenue and a customer’s trading profit or loss are different quantities. The agreement must specify eligible revenue lines, deductions, timing and negative-balance treatment before a percentage can produce a meaningful partner amount.
Name the amounts that belong in the base
Start with identifiable revenue records rather than a dashboard total. Specify whether the base includes a spread component, charged commission, financing income or other amounts, and which accounts qualify. Check whether a report already includes one component inside another; adding both can double count the same revenue. B2BROKER describes revenue share as a compensation category, but a category name does not supply your contractual formula. Do not substitute client deposits or trading losses for an agreed revenue measure.
Sources for this section
List deductions and their evidence
If the arrangement uses a net base, identify each permitted deduction and how it maps to source records. Execution charges, refunds or rebates are not automatically deductible simply because the broker incurs them. The contract controls inclusion. Keep provider fees and settlement adjustments identifiable; Adyen’s settlement reporting illustrates why gross, net and fee fields must retain their separate meanings. Its payment-report format is an engineering reference, not a definition of brokerage revenue or IB entitlement.
Sources for this section
- Adyen: transaction-level settlement details reportdocs.adyen.com
Resolve timing and negative periods
A revenue event, refund and bank receipt can occur in different reporting periods. Choose the agreed recognition basis and keep the original event date alongside the booking date. Determine whether a negative base produces a negative accrual, carries forward or is floored at zero, and at which level that rule applies. Flooring each customer separately can give a different result from flooring the whole partner period. Avoid applying a convenient default where the agreement is silent.
Review the calculation before changing its inputs
A partner percentage should not be deducted from its own base unless the contract deliberately defines and solves that circular relationship. Keep rate versions distinct from base definitions and correction rules. Before approving a revised statement, reproduce the previous total, identify the changed source lines and calculate the difference. A reviewer needs both the arithmetic and the reason a particular line belongs in the base; a spreadsheet formula alone does not settle the contractual interpretation.
One dataset, two explicitly different contracts
Assume a fictional period contains USD 1,200 of eligible commission revenue and USD 800 of separately measured spread revenue. A net-base contract allows USD 100 in rebates, USD 300 in execution costs and USD 50 in refunds as deductions. The base is therefore USD 1,550 and a 25% share is USD 387.50. A different gross-base contract paying 25% of the same USD 2,000 would produce USD 500. Neither amount is universally correct; they answer different agreements.
| Step | Amount |
|---|---|
| Distinct eligible revenue components | 1,200 + 800 = 2,000 |
| Explicitly permitted deductions | 100 + 300 + 50 = 450 |
| Net base | 2,000 − 450 = 1,550 |
| Partner share | 1,550 × 25% = 387.50 |
Implementation checklist
- Define the revenue lines without duplicate components.
- Map every deduction to an allowed category and evidence.
- Specify event timing and negative-period treatment.
- Preserve the base definition and rate version used for each accrual.
Sources
These documents support the reference. Check the original publication for current requirements and the limits of its scope.
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