THE introduction of financial fair play rules in European football has shone a light on weaknesses in the business dealings of some clubs and "inadequacies" in their financial reports, according to a study carried out at the University of Stirling.
Evidence gathered for the research suggested that the current financial statements produced by clubs are of little or no use, amounting to something of a box-ticking exercise which offered "little meaningful disclosure on key performance indicators like salary costs".
Overall, researchers recorded "considerable support" for Uefa's financial fair play (FFP) regulations, although a number of specific concerns about the rules were also highlighted. These included doubts over the capacity of Uefa to enforce the rules when dealing with the wealthiest clubs and the irony of using financial penalties for those clubs which break financial rules.
The study was conducted for the Institute of Chartered Accountants of Scotland (Icas) by sports finance expert Stephen Morrow, a senior lecturer on the subject at Stirling. The study also railed against the "seemingly paradoxical" background that Uefa introduced its financial fair play regulations, effective from this season, to encourage clubs to adopt a sustainable approach to their business activities.
It noted UEFA's willingness to enforce their rules - Manchester City were among the first to fall foul of the new regulations - but questioned the logic of imposing financial penalties on clubs who break rules which are supposed to improve club financial management. The potential for "double jeopardy", where a club which has been fined once might find it harder to break-even again and thus risk further sanctions, was also discussed.
"Evidence suggests that financial reporting in clubs is compliance driven," added Morrow. "It provides some limited assurance to users like governing bodies/leagues, but offers little meaningful disclosure on key performance indicators."
Why are you making commenting on The Herald only available to subscribers?
It should have been a safe space for informed debate, somewhere for readers to discuss issues around the biggest stories of the day, but all too often the below the line comments on most websites have become bogged down by off-topic discussions and abuse.
heraldscotland.com is tackling this problem by allowing only subscribers to comment.
We are doing this to improve the experience for our loyal readers and we believe it will reduce the ability of trolls and troublemakers, who occasionally find their way onto our site, to abuse our journalists and readers. We also hope it will help the comments section fulfil its promise as a part of Scotland's conversation with itself.
We are lucky at The Herald. We are read by an informed, educated readership who can add their knowledge and insights to our stories.
That is invaluable.
We are making the subscriber-only change to support our valued readers, who tell us they don't want the site cluttered up with irrelevant comments, untruths and abuse.
In the past, the journalist’s job was to collect and distribute information to the audience. Technology means that readers can shape a discussion. We look forward to hearing from you on heraldscotland.com
Comments & Moderation
Readers’ comments: You are personally liable for the content of any comments you upload to this website, so please act responsibly. We do not pre-moderate or monitor readers’ comments appearing on our websites, but we do post-moderate in response to complaints we receive or otherwise when a potential problem comes to our attention. You can make a complaint by using the ‘report this post’ link . We may then apply our discretion under the user terms to amend or delete comments.
Post moderation is undertaken full-time 9am-6pm on weekdays, and on a part-time basis outwith those hours.
Read the rules hereComments are closed on this article