Here is a test. Not for your brokers, for you. Set aside the headline numbers you quote at aggregator nights and answer these honestly, with a figure rather than a feeling. They are the questions a buyer doing due diligence on your business would ask. They are the questions ASIC is increasingly able to ask from the data. And they are the questions you would want answered before you found out the hard way.
Most principals can answer the first few without trouble. Settlement volume, headcount, roughly what the book pays each month. Then it gets harder, and the honest part of the exercise is not answering the questions. It is noticing which ones you cannot.
More people are asking them than used to. Trail books are changing hands at higher multiples than they were a few years ago, and buyers price what you can prove. ASIC has shifted from chasing individual complaints to monitoring networks with data. And your brokers are an asset that can walk out the door. Being able to answer has stopped being a nice-to-have. This is general information, not advice, and the questions matter more than any single number inside them.
What your book is actually doing
Start with the money, because most of it is hiding in plain sight on the monthly RCTI.
What is your clawback rate as a percentage of upfront, and which brokers and lenders drive it? The dollar figure on the clawback line is close to useless on its own, because your biggest writers will always produce the biggest dollar clawbacks. The number that matters is the rate. As a rule of thumb a network at 5% or less of upfront is healthy, and once it is pushing past 10% to 15% it is telling you something about churn, client fit or how files are being written. Clawbacks touch the large majority of brokers in any given year, so this is not a fringe risk. If you cannot break the rate down by broker and by lender, you cannot tell whether the leakage is the market refinancing your clients out, or particular writers putting business on that was never going to stick.
What is your trail book worth, and which way are its run-off and yield heading? Trail is the asset. Quality residential books now change hands at something like 2.75 to 3.75 times annual trail, up from the 1.5 to 2 times of a few years ago, and at least one specialist valuer lifted its baseline model again in 2026. But that multiple is not automatic. It rests on how diversified the book is, how fast it runs off (a residential book typically sheds in the order of 1% to 2% of balance a month, giving it a half-life of a few years) and how clean the data behind it is. If all you know is the book's current balance, you cannot put a number on what is arguably your single largest asset.
What share of your revenue is upfront versus trail, and what happens if settlements slow? Upfront pays today's bills. Trail is the buffer. A business running mostly on upfront is on a treadmill, because a credit squeeze or a slow quarter hits revenue immediately. The question worth being able to answer is how much of your fixed overhead your trail alone would cover if new settlements stopped tomorrow. If you do not know that ratio, you do not know how exposed you are.
Where your risk is sitting
Two of these you can see at a glance once you look. Most principals never look.
What is your lender concentration? Add up where your network's volume goes and you can measure it properly, using the same index competition regulators use. For context the national mortgage market sits at around 1,553 on that index, below the level regulators treat as a concern. At a network level the rule of thumb is that under about 1,800 is well spread and anything above 2,500 is concentrated. It matters two ways. A policy change or a service problem at one dominant lender hits a big slice of your pipeline at once, and heavy concentration is one of the things that draws a regulator's eye, because it raises the question of whether files are going where they suit the broker rather than the client.
What is your average loan size and LVR profile, and which way is it trending? Average loan size and the spread of LVRs across the book tell you the credit risk you are carrying in aggregate. A book drifting up the LVR scale is more exposed to a property correction and to clients getting stuck when they try to refinance. The standard line is the 80% mark, above which lenders mortgage insurance and tighter pricing apply. And if your average loan size is flat while costs rise, your margin per settled loan is quietly compressing. None of this shows up in a settlements total.
Who is actually performing
Volume is the number everyone celebrates. It is also the most misleading one.
Who are your strongest and weakest writers by conversion, not just by volume? Lodgement-to-settlement conversion is the efficiency measure that gross volume hides. The market runs at roughly 76% lodgement to settlement, while the top performers sit above 82%. A writer with high lodgement volume but weak conversion is burning your processing capacity on files that withdraw, decline or restructure, which lifts your cost per settled loan and wears on your lender relationships. Ranked on volume that broker looks like a star. Ranked on conversion they may be your most expensive operator.
Which of your brokers is disengaging, and would you know before they leave? A broker rarely resigns out of nowhere. They slow down first, and the slowdown shows up in their lodgement pattern, recency and consistency, months before notice. By the time the resignation lands they have often already spent two to three months quietly preparing the client transition. Watching for activity that drifts away from a broker's own 12-month pattern is what lets you have the conversation while there is still a book to keep. If you find out when the email arrives, you find out too late.
What you could actually prove
The last three are the ones that turn into disputes, penalties or a discount on your sale price.
When a broker leaves, what happens to their trail, and who owns it? This is one of the most contested areas in the industry, and it lives or dies on your contracts. Good-leaver and bad-leaver terms decide whether an exiting broker keeps their trail, sells it at fair value or forfeits it. Worth knowing too that since the ASIC reference checking protocol was extended to aggregators in 2024 and bedded down in early 2025, the old informal letter of separation is largely obsolete and a broker's conduct history now follows them formally. If your contractor agreements do not define trail and client ownership on exit, and do not line up with your aggregator's head agreement, a single departure can become litigation or a cash flow hole.
When was each broker's last independent file audit, and what did it find? An aggregator checklist is not the same as an independent audit of what is actually in the files. Industry practice is at least an annual independent file audit per writer, and for a growing network of 6 to 40 brokers, more often than that. The recurring findings are rarely arithmetic. Independent audit data shows that five of the six most common recurring findings are about documenting the client's requirements and objectives under the best interests duty, not calculation errors. If you are relying on self-assessment or the occasional aggregator check, you cannot say what your files would show if someone looked, and that someone might be the regulator.
Could you show ASIC how you supervise your network, with evidence? This obligation cannot be handed to your aggregator. It stays with the licensee. Supervision means a documented, active trail: monitoring, file audits, training records and a complaints process that actually works. Under the internal dispute resolution rules a written response is due within 30 days, and licensees report their complaints data to ASIC every six months. The test is not whether you have a compliance policy in a drawer. It is whether you could produce evidence, today, that you checked what your brokers were doing.
The number that matters is how many you couldn't answer
Go back through the questions and count the ones you could answer with a figure rather than a guess. If it is fewer than half, that is not a mark against you. It is the most useful thing this exercise has told you, because almost every one of those answers is already sitting in data you hold: the RCTI you file each month, the lodgement records in your CRM, the files your brokers have already written. The principals who will run the strongest businesses over the next few years are not the ones with more questions. They are the ones who can finally answer these.