"Ryan Inniss has already been taken into account into the budget," Smurthwaite told BBC Radio Stoke.
"But I estimate I will have to make a personal contribution of £350,000 to supplement the budget at £1.7m."
He added: "That causes us concerns as we haven't signed a striker yet.
"I set a budget which the manager could use - which he's spent - and we haven't got the squad I believe we need to be competitive in League One.
"With the two that have joined us this week (Ben Purkiss and Anthony Grant), that will take us up to about £1.85m, which is £150,000 over budget already. That means Rob has to look at existing players to see what we can do."
"I've spent a lot of time with the Palace chairman and their CEO over the last three months and we've had a lot of dialogue," added Smurthwaite.
"We could not afford to take him as one of our players. Crystal Palace would want about £600,000 which is way out of our league. But they were happy with the experience he had here and how we looked after him.
"He needs to sign his contract with Palace and then hopefully they'll give him to us on a year's loan from the beginning of the season and before that too, for the purposes of pre-season."