Almost none of the top RIAs take commissions from clients, according to a Financial Planning study.

Commission-based products and services have become exceedingly rare at the largest RIAs in recent years, SEC Form ADV filings show. Advisers question their value to clients and view them as a compliance burden, experts say.

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Source: Financial Planning analysis based on SEC data.

The number of RIAs with $100 million or more in assets under management still collecting commissions has dropped to 120 firms over the past five years, from 135, according to the filings.

Though the figure is relatively small, the amount of RIA firms nationwide has grown by 27% during the same period. Just 5.5% of such firms now use commissions, down from 8% in 2012.

Meanwhile, the number of RIAs using fixed fees rose by 370 to 1,570. More than 80% of RIAs with $100 million or more in AUM now charge fixed fees, up from 78% in 2012.

“Advisers are increasing their use of annual fees or retainer fees,” says Kenton Shirk, director of US Intermediary research at Cerulli Associates. “If you look at all advisers, there is a trend in doing less commissions business.”

The industry-wide shift in preparation for the fiduciary rule will see commission revenue drop by 35% over the next two years at hybrid RIA-broker-dealers, according to a Cerulli prediction. Fee-only RIAs have already sworn off commissions for decades, though.

FP probed the filings of the 2,157 RIAs listing $100 million or more in AUM from July 2012 to June 2017, excluding hybrid broker-dealer firms. The analysis includes only firms with more than half of their AUM attributable to individual clients.

The firms that eliminated commissions in recent years include prominent ones like Clarfeld Financial Advisors, a New York-based firm with $6 billion in AUM, BerganKDV Wealth Management, a Minnesota-based RIA with $1.4 billion in AUM and California Financial Advisors, which has $960 million in AUM.

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For some, commissions are a vestige of the past. BerganKDV, for example, offered commission-based accounts in the 2000s but began migrating to a purely fee-based model around 2007, according to CEO David Hinnenkamp.

“A lot of commissions are paid upfront and take away the incentive to serve the client on an ongoing basis,” says Hinnenkamp. The firm notified regulators it had stopped accepting commissions in November 2014.

California Financial Advisors followed a similar path. The firm's founders brought commission-based clients from previous posts, but the firm has been fee-only since its start, according to Ryan Dennehy, an adviser at the firm.

“The revenue we received from commissions became such a small part of our business that the time necessary to file the appropriate regulatory documents in order to keep collecting commissions became more valuable than the commissions themselves,” says Dennehy.

Firms began a widespread shift from commissions to AUM-based fees back in the 1990s and early 2000s. Pricing models like the retainer fee have been gaining steam in recent years, primarily among smaller firms and startups.

Why are some RIAs still collecting commissions, given RIAs’ emphasis on fee-based services? The remaining firms use them for rare services such as advice on a private equity transaction, Bob Herrmann, CEO of Discovery Data, says in an email.

“In most cases it is in an ancillary service not part of its core retail investment advisory services,” Herrman says.