Trade Allocation Fairness Review Worksheet

It covers the review of block trade allocations across eligible client accounts to confirm the allocation method matches the approved policy and that no account received preferential treatment. The worksheet also captures supporting records such as the trade blotter, allocation blotter, and order records. It is designed to document exceptions, non-conformances, and corrective actions in one place. Use it as a control record for fair dealing and fiduciary oversight.

Use it after block trades are allocated and before the review is closed out, especially when multiple client accounts participate in the same order. It is also useful during periodic compliance testing, supervisory reviews, or targeted audits of a desk, strategy, or portfolio manager. If your firm handles late allocations, manual adjustments, or restricted accounts, this worksheet helps document those edge cases. It is not a trade ticket or execution log; it is the review record.

A compliance reviewer, supervisory principal, operations control owner, or other independent reviewer should complete it, depending on your firm’s control structure. The key point is independence from the person who made the allocation decision. If the same person both allocates and signs off, the review loses much of its value. Many firms also require escalation to compliance when exceptions or repeated patterns are found.

The cadence depends on trading volume and risk, but many firms review block allocations on a sample basis daily, weekly, or monthly. Higher-risk desks, manual allocation processes, and strategies with frequent exceptions may warrant more frequent review. The worksheet supports both routine sampling and event-driven reviews after a complaint, surveillance alert, or policy change. Whatever cadence you choose, document the review period and sample set clearly.

This worksheet supports fair dealing and fiduciary oversight expectations under securities compliance programs, as well as internal supervisory controls and recordkeeping practices. It is commonly used alongside policies aligned to SEC and FINRA expectations, investment adviser fiduciary duties, and general books-and-records requirements. The template is not a legal opinion, but it helps demonstrate that allocations were reviewed against an approved policy and that exceptions were handled consistently. Firms may also adapt it to internal code-of-ethics or best-execution controls.

Common issues include allocations that do not match the approved methodology, rounding that is applied inconsistently, and late manual changes that are not documented or approved. Reviewers also often find patterns that favor one client, employee, or proprietary account over others. Another frequent issue is missing support for why an account was eligible or excluded from a block trade. This worksheet is built to surface those problems before they become repeated findings.

Yes. You can tailor the review scope, eligibility rules, allocation method fields, and exception criteria to match equities, fixed income, options, or other trading workflows. Firms often add desk-specific policy references, approval thresholds, or surveillance notes for manual allocations. The structure should stay consistent so reviewers can compare results across periods, but the detailed checks can be adapted to your process. That makes it easier to standardize oversight without forcing every desk into the same operational details.

An ad-hoc spreadsheet usually records numbers, but it often misses the control questions that matter: Was the method approved, were all eligible accounts treated the same, and were exceptions independently reviewed? This worksheet turns the review into a repeatable audit trail with scope, findings, root cause, corrective action, and sign-off. That makes it easier to defend the review during an internal audit or regulatory exam. It also reduces the chance that a reviewer forgets to check for preferential patterns.