RANGERS FC has beefed up its battered balance sheet by booking a huge (pounds) 39m hike in the value of its property - principally Ibrox stadium - it has emerged.

The move enabled Rangers to avoid wiping out shareholders' funds when it posted another huge financial loss earlier this month.

As recently as last year, Rangers' shareholders' funds - which reflect total investment in a company, covering issued share capital, retained profit, and reserves - stood at nearly (pounds) 50m.

The adjustment, which puts a healthier sheen on Rangers' 2003 figures, is buried in the notes to the club's accounts. They disclose that the directors valued the club's freehold properties on June 30, 2003, the end of the financial year, based on a report from the Edinburgh chartered surveyors DM Hall. The exercise increased the accounting value of the property from (pounds) 85m to (pounds) 120m, a surplus increased by a further (pounds) 4m by the elimination of depreciation.

The section of the accounts dealing with movements in shareholders' funds lays bare the impact of the change. Total funds stood at (pounds) 47.3m in 2002 but were slashed to just (pounds) 12m by the (pounds) 35.3m loss Rangers posted last year.

This year's (pounds) 29.6m deficit would have dragged closing shareholders' funds far into negative territory - but for the revaluation, which boosted reserves. Closing shareholders' funds stayed positive as a result of the paper gain, at (pounds) 21.5m.

Asked to explain how the value of the club's properties had increased, the club would only confirm that the revaluation had taken place, and referred The Herald to DM Hall.

DM Hall's Roy Hudghton, who carried out the valuation, stressed: ''An asset valuation based on depreciated replacement cost should not be confused with the price you would get for selling something. A lot of companies have seen their asset values rise over the last few years due to rising estimates of how much it would cost to replace them.''

Shareholders in the SPL club will convene next Friday at the club's annual meeting, at which financial matters will doubtless be overshadowed by the club's Champions League win over Stuttgart. However, it is significant that majority owner David Murray is again expected to be absent, after he handed over the chairman's reins to John McClelland last year.

With Rangers nursing a net debt of (pounds) 68m, and the Bank of Scotland thought to be reluctant to increase the club's (pounds) 17m overdraft, it is to Murray Rangers must look for new funds. In July, the metals-to-mining tycoon extended a revolving credit facility of (pounds) 15m to the club through one of his companies.

Rangers has drawn on about (pounds) 4m of that money so far, and analysts speculate that Murray is unlikely to seek repayment.

McClelland, meanwhile, has expressed confidence that Rangers' finances are turning the corner, with at least an extra (pounds) 17m flowing into the Ibrox coffers from recent player sales and the Champions League. Player wages are also falling as the club's biggest earners gradually depart.