What Information Should Relatives Receive About the Office's Costs and Results?

Relatives should receive enough information to understand the office's costs and work. Report spending against the approved budget, describe services delivered, and show progress on the responsibilities assigned by the family. Explain significant variances and identify decisions that need family attention.

Report Costs in a Useful Format

Use consistent categories so relatives can compare actual spending with the approved budget over time. Depending on the office, categories may include staff compensation, outside professional services, technology, insurance, building expenses, and administrative support. Separate recurring operating costs from one-time setup costs when that distinction helps the family understand the expense.

For each category, show the budget, actual amount, and a short explanation of any material difference. Identify commitments that have been approved but not yet paid if they affect the family's view of available budget. Avoid unexplained totals: relatives need enough context to see what the office paid for and which services those costs support. A family office cost calculator can help frame the budget discussion.

Connect Spending to the Office's Work

Pair financial reporting with a concise account of the office's responsibilities and completed work. For example, describe whether reporting, coordination, or other approved services were delivered. State what remains in progress and where the office depends on an outside provider. If the family has agreed on performance measures, report progress against them and explain what affected the result.

Keep the measures tied to the office's actual scope. A new office should not claim credit for investment performance or other outcomes it does not control. The family's purpose and assigned responsibilities provide the appropriate basis for review. A single family office fundamentals guide can help clarify the operating model. The operational processes guide can help identify recurring work to report.

Protect Privacy and Explain Access

Transparency does not require sending every relative every personal record. Establish who receives summary reports and who can review supporting documents. Explain how sensitive information is handled. Set out those access rules in advance, including any limits required by confidentiality or legal obligations. For specific legal or tax questions, talk with your attorney or CPA.

Keep the underlying invoices, authorizations, agreements, and reports organized so authorized family representatives can review them. If the office allocates expenses among branches or households, explain the method and show how it was applied. Consistent records make the report easier to trust and allow the family to raise a specific question.

Make Reporting Regular and Candid

Choose a reporting schedule and follow it. Include a brief narrative that explains what changed, what requires attention, and which decisions are pending. When a service cannot be provided or a result falls short of the family's expectation, state that clearly and describe the next step. A guide to managing service expectations can help align reporting with the limits of the office's scope.

Reliable reporting gives relatives a basis to judge the office on its approved responsibilities. It also makes budget conversations more specific, since family members can discuss particular expenses and services. Reports can identify open decisions and help relatives address them with facts.

The main difference to remember between single and multi-family offices is that single family offices are customized solutions for a single individual or family while multi-family offices are setup as platform solutions that aim to customize their solutions but really help leverage centralized resources across many Ultra Affluent Clients (UACs).

Sources: The Family Office Book, The Single Family Office. Informational only, not financial, legal or tax advice.