A new dawn for Fair Play? The annual survey of Football club Finance Directors (BDO, 2013)

7/27/2019 A new dawn for Fair Play? The annual survey of Football club Finance Directors (BDO, 2013)

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The annual survey o ooTball clubinance direcTors 2013

a new dawn

or air Play?


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ooTball survey 2013 3

oreword

C Btt, Tv Bic I C

Fair play has always been at the heart o the beautiul game,so it is good to see its appearance in the fnances o ootballas well. An encouraging 95% o English clubs are expecting tocomply with the Financial Fair Play rules in 2013/14 (the frstseason when FFP will apply to all English domestic leagues).As a consequence most FDs have reported some orm orestraint on wages and transer ees, a vital step on the roadto more sustainable business models or all.

In fnancial terms, the run o play has been going against manyclubs but i we have discovered anything while producing thissurvey, its that ootball clubs are fghters. Indeed, its probablynot news that many o our fndings this year give some levelo cause or concern. But what is perhaps more surprising, andencouraging, is the extent to which clubs are still managing tocope with adversity and take better controlo their circumstances.

This is not to downplay the challe nges. We are seeing manycommon actors which conspire to increase fnancial instabilityand risk. For instance, a number o clubs depend heavily uponeither a single owner or a small number o key shareholders,who may have their eye on short term glory. Inevitably, thehuge potential rewards or reaching the Premier League may

lure many clubs into a gambling rame o mind, risking uturefnancial security or the big prize. As a long term model, thisis not sustainable, and could result in structural instability ormany clubs i it goes unchecked.

Revenue streams are also down (and by more than fnancedirectors expected). However, some o this can be put downto the UKs delayed economic recovery, though, according tothe latest indicators, we may be turning the corner at last. Itis also interesting to see that the revenues o the SPL (nowScottish Premiership) clubs have not been adversely aectedwhen compared with the other leagues surveyed. Tellingly, SPL2012/13 was the frst season without Rangers.

Now that PKF has merged with BDO, our goal has been tomake this years survey reach urther than ever beore. In totalwe managed to interview 66 fnance directors o ootball clubs,a best-ever total that represents 63% o the ootball leagueseatured. We would like to extend our special thanks to all ourcontributors, and wish every one o our readers a prosperousseason ahead. For every completed survey, we have made adonation to the PFA Benevolent Fund.

Executive summary 1

Methodology 2

Analysis o key ndings 2013 3

BDO Proessi onal Sports Group 25

conTenTs

ooTball survey 2013ooTball survey 2013


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Football survey 2013Football survey 2013 21

execuTive summary

inancing The club

Only three out o ten nance directors rate their clubs nancialsituation as very healthy. Almost hal (48%) say that their

situation could be better but is not bad; 17% o respondents

nances need attention while 5% say their nances are a cause

or grave concern.

Two thirds (65%) o respondents are dependent on the principalshareholder(s) to nance annual revenue shortalls or operating

losses up signicantly rom 58% in 2012.

The current owners o more than a third (36%) o FL1 and 28% oFLC clubs in the survey are considering a ull or partial exit.

A th o clubs in the survey (21%) have been approached in thelast 12 months by interested external parties with a view to taking

an euity stake rising to a third o FLC and 40% o SPL clubs.

club revenue and ProiTabiliTy Trends

Almost two thirds o respondents (64%) do not expect tomake a prot before player trading and amortisation in their

next accounting period. The two premier leagues are the

most condent with 92% o EPL and 60% o SPL respondentsanticipating a prot.

Two thirds (65%) o respondents also do not expect to makea prot afterplayer trading and amortisation in their next

accounting period.

The UK economic conditions continue to depress revenues withmore than hal o the clubs reporting reduced sales o match

tickets, merchandising and corporate entertaining. However,

nance directors are more optimistic about revenue prospects in

the orthcoming 2013/14 season.

Only 44% o respondents are using the wages to turnover ratio asa key perormance indicator (KPI) o their clubs nancial health

down rom 58% in 2012. 41% o clubs using the ratio have a

benchmark o less than 55% also down rom 58% in 2012.

club oPeraTions

The three top concerns o ootball nance directors continue tobe the infexibility o players salaries, the loss o income i the

club is relegated, and the all in attendances due to the economic

environment. A new concern or the EPL and FLC nance directors

is the challenge o complying with the nancial air play (FFP)

regulations.

A th o clubs were late with tax payments during the year butmost o these had ormally agreed the delay with HMRC. More than

hal o respondents (52%) said that HMRC was contacting them

earlier and more reuently to chase payment o the tax due.

Almost a uarter (23%) o clubs are concerned about increasedchallenges by HMRC to complex salary structures, which could

lead to large PAYE bills. The EPL and FLC are the most concerned

with 41% and 39% o respondents respectively.

It appears that the nancial air play rules are being takenseriously: 95% o respondents will comply with the FFP rules in

2013/14; 42% o clubs admit that their decision not to increase

the cost o the rst team payroll has been partly or l argely driven

by the air play rules; 22% say that FFP rules have aected their

decision to not to increase their transer budget.

Player cosTs and Transers

More than eight out o ten (85%) clubs have clauses in playerscontracts stipulating a wage cut i the club is relegated. The number

o EPL and SPL clubs with these clauses has increased over the last

12 months rom 56% and 33% to 75% and 60% respectively.

More than hal (53%) o respondents will cut the sie o the rstteam suad; 42% will keep it the same sie; and 5% will increase

the suad sie. More than hal (56%) are also pl anning a smaller

payroll budget or their rst team suad.

Nearly two thirds (64%) o respondents will keep their transerbudget the same as last year; a uarter (24%) will reduce it and

only 12% will increase it.

corPoraTe governance

Almost all (92%) respondents regard their ootball club as a publicinterest business with a high degree o scrutiny.

Nearly two thirds (64%) o respondents agree that the levelo public interest leads them to manage the club with a higher

level o corporate governance than they would or a similar sied

business outside the ootball sector.

Proile

o samPle

englishPremierleague

12clubs

60%resPonded

ooTballleaguechamPionshiP

18clubs

75%resPonded

ooTballleagueTwo

17 clubs

71%resPonded

ooTballleagueone

14 clubs

58%resPonded

scoTTishPremierleague

5clubs

42%resPonded

BDO UKs Proessional Sports

Group commissioned anindependent researcher in May

and June 2013 to undertakestructured telephone

interviews with nance

directors o ootball clubs.

A total o 66 interviews werecompleted with nance

directors in the English Premier

League (EPL), English FootballLeague Championship (FLC),

Football Leagues One (FL1)

and Two (FL2) and the Scottish

Premier League (SPL).

Since the survey was

undertaken the SPL hasbeen renamed the Scottish

Premiership.

Throughout this survey, results

are presented as percentagesrounded to the nearest whole,

and arithmetic means, unlessotherwise stated.

meThodology



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Football survey 20133 ooTball survey 2013ooTball survey 2013 43

Financing the club

1. h t t pt?

% a ePl lc l1 l2 sPl

Very healthy 30 83 22 14 18 20

Could be betterbut not bad

48 17 50 50 64 60

In need o attention 17 0 22 29 12 20

A cause or graveconcern / onthe verge oadministration

5 0 6 7 6 0

Base: 66

Only three out o ten nance directors rate their clubs nancialsituation as very healthy the same result as in 2012 and theres a wide variation between the dierent leagues, with 83% o EPL

respondents enjoying good nancial health compared to just 14% oFL1 respondents.

Almost hal (48%) say that their situation could be better but is not

bad, while 22% o respondents nances need attention or are acause or grave concern. This gure is up rom just 13% in 2012, whileover a third (36%) o FL1 respondents admit nancial diculties.

2. i pt t pp t t pt ?


Yes 65 5 0 94 64 53 40

No 35 50 6 36 47 60

Base: 66

The trend towards greater reliance on a single owner or smallgroup o shareholders continues to strengthen. Two thirds (65%) orespondents are dependent on the principal shareholder(s) to nanceannual revenue shortalls or operating losses. This is up rom 58% in2012, and the percentage rises to 94% or FLC respondents.

Indeed, the SPL is the only league which appears to have reduced itsdependency on principal shareholders this year.

analysis o indings 2013

65 DEPENDENT ONPRINCIPAL SHAREHOLDERS%

No surprises here! The EPL surgesahead and the lower leagues are letfoundering in its wake. Howeverthere may be cause or optimism aswe see the implementation o the airplay regulations starting to have astabiliing eect on operations goingorward. Stakeholders are crying outor a sustainable business modeland it can only be hoped that theregulations are embraced not just inletter but in spirit. Trevor Birch

Football survey 2013 4ooTball survey 20133


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3. h .. t k t t t ?


Advance onseason tickets one year

YesNo

991

0100

1783

793

1288

0100

Advance onseason tickets two or more years

YesNo

0100

0100

0100

0100

0100

0100

Player transeree receivables

YesNo

1486

892

1783

793

1882

0100

Other receivablesYesNo

991

2575

1783

0100

0100

0100

Base: 66

The last 12 months have not seen much rise in the use o secondarysource unding, which was low to begin with. Just 14% o clubs usedsecondary source unding secured on player transer ee receivables,while 9% have used the advance on season tickets as loan security.

However, urther analysis o the results reveals that 39% o FLCrespondents have used at least one o the secondary sources ounding listed in the survey. Only the SPL respondents did not citeany such unding at all.

4. h tt t ?


Yes 30 42 28 21 12 80

No 70 58 72 79 88 20

Base: 66

Although seven out o ten clubs in the survey have not given a xedcharge over their stadium as loan security, 80% o SPL and 42% oEPL respondents have done so.

It is likely that the banks have been willing to use the stadia o largerclubs as security or loans to meet the lenders reuirements, but in thebelie that it is unlikely that they will need to make a call on this security.

5. i t tt t , t tpp t ?


Build or expandthe stadium

36 20 33 0 75 50

Provide cash fowor the club

64 80 67 100 25 50

Base: 20

O the 20 clubs who have given a xed charge over the stadium assecurity, 64% used the loan to provide cash fow or the club, while

just 36% used the money to build or expand the stadium. Two clubsreported that they had used the loan or both purposes.

Leverage o xed assets or shortterm working capital, rather thaninvestment in inrastructure, is clearlyunsustainable. However, one mightexpect to see this trend reverse in lighto nancial air play regulation.

Ian Clayden

30have given a fixed chargeover their stadium%

ooTball survey 2013 6ooTball survey 20135


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6. a t t t pt t t t t 12-18 t?


Yes 17 0 28 3 6 0 20

No 83 100 72 64 100 80

Base: 66

Although only 17% o respondents current owners are considering aull or partial exit, this is mostly concentrated in the FL1 (36%) andFLC (28%) clubs.

7. wt t t 12 t, t jt t pp tt t pt t t tk qt tk t ?


Yes 21 8 33 21 0 40

No 79 92 67 79 100 60

Base: 66

Over the last 12 months a th o respondents (21%) have beenapproached by external parties rising to a third o FLC and 40% oSPL respondents. Only the FL2 respondents have had no interest.

investment cycle

In Leagues Apart, our 2012 report, we identied the growingdisparity between the English Premier League and the rest o theootball industry. This years survey suggests that the gap mayhave widened even urther in the past 12 months.

Intense competition or a limited number o promotion placeshas pushed the majority o Championship and League One clubs

into the red and created a dependency on principal shareholdersbankrolling trading shortalls.

In this context, we now see around a third o existing ownersseeking a ull or partial exit, while a similar proportion o clubsare being approached by new external investors. Despite thesignicant nancial costs, the enduring appeal o ootball hascreated a clear investment cycle, with new owners eager to pickup the baton rom shareholders that are no longer prepared orable to nance the cost o their clubs ambition.

Clubs outside the EPL arecontinuing to experience nancialchallenges so the growing numbero owners seeking out externalinvestment is a conseuentialinevitability. This trend is likely tocontinue, although the growingappetite or investment is encouraging,refecting the attraction that theleagues still hold. Ian Cooper



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Football survey 20139

club revenue and proFitability trends

8. d pt t k pt before p t tt t t p?


Yes 36 92 17 29 18 60

No 64 8 83 71 82 40

Base: 66

With the exception o the SPL nance directors who are morecondent than last year these results are very similar to those in2012, with almost two thirds o respondents (64%) not expectingto make a prot beore player trading and amortisation in their nextaccounting period.

However the two premier leagues are much more condent, with92% o EPL and 60% o SPL respondents expecting to make a protcompared to just 17% o FLC and 18% o FL2 respondents.

9. d pt t k pt afterp t tt t t p?


Yes 29 42 6 43 24 60

No 65 42 88 50 76 40

Dont know 6 16 6 7 0 0

Base: 66

The overall prot outlook or the next nancial year continues todarken, with two thirds (65%) not expecting to make a prot aterplayer trading and amortisation compared to 57% in 2012 (and onlya third in 2011).

The most troubled leagues are FLC and FL2, where respectively 88%and 76% o respondents expect to make a loss.

The SPL respondents have the brightest outlook, with 60% expectingto make a prot.

It is concerning to note that despitenancial air play and wage capping nowoperating in all English proessional divisions,there is no noticeable improvement in thehigh number o clubs expecting to make a lossnext season. Responses to uestion two veryclearly demonstrate that these losses will benanced by the clubs principal shareholder,a position that is not sustainable. We shouldnot be surprised to see more administrationsin the coming months. Charles Barnett

before playertrading

36% after playertrading

29%

oF clubs who expectto make a proFit....%

Football survey 2013 10Football survey 20139 10ooTball survey 2013


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10. wt t pt t t t t t t ?


mt tktReducedNo impactImproved

592120

255025

731116

651421

652411

600

40

mReducedNo impactImproved

552916

581725

731710

503614

48475

202060

mt tReducedNo impactImproved

444115

17758

562816

423622

53416

402040

cpt ttpkReducedNo impactImproved

562420

501733

671122

502921

59356

404020

s tkt ReducedNo impactImproved

453124

176617

666

28

352936

532918

404020

sppReducedNo impactImproved

334324

8

4250

393328

432631

365311

40600

Base: 66

This years results continue the trend o the last three years, withlittle evidence o improvement in revenue streams over the past12 months. More than hal o the respondents continue to suera reduction in revenues or match tickets (59%), merchandising

(55%) and corporate entertaining (56%). However, the impact is lessnotable within the EPL than in other leagues.

The FLC is suering the greatest reduction in almost all revenuestreams, with 73% reporting lower revenues or match tickets andmerchandising, 67% experiencing a drop in corporate entertainingand season ticket sales, and 56% reporting a reduction in match daycatering.

Two thirds (65%) o FL1 and FL2 respondents have also suered areduction in match day ticket sales, and 59% o FL2 respondentshave reduced revenues rom corporate entertaining.

The only glimmers o good news are improved results or merchandisingand sponsorship or SPL respondents; an improvement in sponsorshiprevenues or hal o EPL respondents (compared with just 11% in2012); and an improvement in season ticket sales reported by 36% oFL1 respondents up rom 13% in 2012.

29%

%

11. wt t pt t tt t t 2013/14 t p t t jt ?


mt tktReducedNo impactImproved

294724

176617

503317

215821

185329

400

60

mReducedNo impactImproved

275122

244333

444412

7

7221

186418

400

60

mt tReducedNo impactImproved

235423

0

1000

394417

145036

304624

202060

cpt ttpkReducedNo impactImproved

294526

255025

334522

145036

414118

204040

s tkt ReducedNo impactImproved

353530

175825

611722

363628

244135

202060

sppReducedNo impactImproved

245026

8

5042

394417

145036

244729

404020

Base: 66

Finance directors across all the leagues are generally more optimistic orthe orthcoming year (2013/14). The SPL is the most condent league oall, with 60% o respondents anticipating improved season ticket sales,merchandising, match day catering and match day ticket sales.

23%

MaTCh dayCaTerIng

27%MerChandIsIng

24%

sponsorshIp

35%seasonTICkeTsales

29%MaTChTICkeTs

CorporaTeenTerTaInIng

paCkages

oF clubs whopredict a Fallin sales For the

Financial yearahead



9/17


12. d t t t t kp t t t?


Yes 44 50 39 43 35 80

No 56 50 61 57 65 20

Base: 66

13. i k?

% a

66% 7

Base: 29

In last years survey there was evidence that best practice on wagesto turnover ratios were beginning to be ollowed. However, thisposition has reversed this year with only 41% o clubs operating toa benchmark o not more than 55% compared with 58% o clubs inthis range in 2012. Even so, there has been no signicant change inthe percentage o clubs using a benchmark o greater than 60%; this

year 35% used this benchmark, virtually the same as in 2012 (33%).

14. wt t t t tpt ?


66% 29 42 66 0 12 0

Not calculated 6 0 5 7 6 20

Base: 66

Although 42% o all respondents operate below 55%, much o thiscan be attributed to FL1 and FL2 clubs which have operated with asalary cap or the last ew years. Indeed, more than three uarters othe FL2 clubs and hal o the F L1 clubs operate below 55%. Howeveronly 31% o EPL and 17% o FLC clubs operate below 55%, with twothirds o FLC and 42% o EPL respondents operating above 66%.

The results or EPL and FLC show the extent to which these clubsinvest in players, undoubtedly in an eort either to retain or gain EPLstatus. This ties in with the g eneral ndings that the rewards o theEPL are hugely, even disproportionately attractive, and can temptclubs into highrisk strategies.

Jubilee and Olympic optimism thatinvigorated the UK in the summer o2012 was not enough to end o theimpact o the near collapse o theEuroone, a return to recession andsome o the worst weather in livingmemory. In this regard, like much othe UK economy, the results or theootball sector did not, on the whole,meet expectations.

use the wages toturnover ratio as a keyperormance indicator44%

Ian Clayden



10/17

inancial air Play (P) regulaTions will aPPlyacross all english Proessional divisionsor The irsT Time This coming season.

sPoTlighT on:

inancial air Play

0% 10% 20% 30% 40% 50% 60% 70 80% 90% 100%

88%claim To havecomPlied wiThThe relevanTregulaTionslasT season

83%Plan To

sPend Thesame or lesson Payroll

42%saId TheIr

deCIsIon wasInfluenCed

By ffp

most pressing concerns for epL and fLc cLubs

exPecTTocomPly

wiThouTany

significanTchangesTo

businessmodels

85%

10%exPecTTo

comPly

albeiT

follo

wing

significan

T

chan

ges

oF clubs expect to reducetheir transFer budgetsor keep them the same.O the clubs planning to reduce orkeep their transer budget constant,22% stated that FFP was a driver;however, this gures rises to 44%and 41% or EPL and FLC clubs

88%t

f f q,

. o

FFp q . t

, f f

- .

ian clayden

ooTball clubcomPliancewiTh The P

rules in 2013/14

t t ptt, p 79% t

; t ePl, t 56% t 75%

84%

ooTball survey 201315 ooTball survey 2013 16


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club operations

15. wt t pjt -ppt p t t t ?



12/17


19. w t t t t pt t ..pt t, Paye/nic, vaT t hmrc?


Yes 20 0 17 29 29 20

No 80 100 83 71 71 80

Base: 66

A th o all respondents were late with tax payments during theyear. None o the EPL clubs were late compared with three out o teno the FL1 and FL2 clubs. O the clubs who paid late, 14% and 18%o FL1 and FL2 respondents respectively had not ormally agreed thedelay with HMRC.

20. h t hmrc tttt p t t t ?


Yes, it is contactingus earlier and /ormore oten

52 42 61 71 35 40

Yes, it is taking themlonger to get intouch

3 0 0 0 6 20

No 45 58 39 29 59 40

Base: 66

More than hal o respondents (52%) said that HMRC was contactingthem earlier and more oten to press or the collection o the tax due.

21. hmrc j pjt p tt t t pt p t tt.T t ptt Paye t . w tttt ft ?


Not concerned, the taxposition on paymentsto our players is robustand very deensible

77 58 61 86 100 80

Somewhat concernedthat a sieablechallenge could createa problem

18 25 39 7 0 20

Very concerned thata sieable challengewould create aproblem

5 17 0 7 0 0

Base: 66

Last year, 92% were condent that their tax position on payments toplayers was robust and deensible to HMRC but doubts appear to becreeping in with only 77% not concerned this year. The EPL and FLCare, not surprisingly, the most concerned with respectively 42% and39% o respondents.

It is no great surprise thatnearly a uarter o all clubs areexpressing concern about a possiblechallenge rom HMRC into complexpay structures. The pressure onremuneration planning has increasedas a result o legislative changes, policyand the increased media attention. Ithe appeal in the case o Murray GroupHoldings v HMRC (involving RangersFC) nds in avour o the tax man thenwe can only expect heightened activityby HMRC into arrangements by other

clubs. Apart rom salary structures,payments made to agents are alsounder HMRCs spotlight.

Andy Goodman

were condent their tax position onpayments to players was robust anddeensible to HMRC compared to92% last year

77%Football survey 201319 ooTball survey 2013 20


13/17


27. i t t 2013/14 t , t t tt t p ?


Not at all 78 56 59 84 100 1 00

Yes, to some extent 14 33 23 8 0 0

Yes, to a considerable extent 8 11 18 8 0 0

Base: 58

78% o respondents who are reducing or keeping their transerbudget the same deny that their decision has been driven by the FFPrules although more than one in ve (22%) admits that the FFP ruleshave had an impact on their decision.

The FLC and EPL appear to be most aected by the FFP rules with41% and 44% respectively admitting that their decision was p artlydriven by new regulations.

player costs and transFers

22. d p ttt tpt tt t t

t t?


Yes 84 75 94 71 94 60

No 14 17 6 29 6 40

No response 2 8 0 0 0 0

Base: 66

More than eight out o ten (84%) clubs have clauses in playerscontracts stipulating a wage cut i the club is relegated, a slightncrease on last years 79%. The FLC and FL2 clubs are the most likely

leagues to have relegation clauses in players contracts (94%).

Prudence is clearly on the rise, however, with 75% o EPL and 60%o SPL respondents now having these clauses, compared to 56% and33% respectively last year.

23. i t 2013/14 t tq z , t t t jt ?


Larger 5 8 0 7 6 0

Same 42 50 28 50 47 40

Smaller 53 42 72 43 47 60

Base: 66

Clubs this year are continuing the trend o reducing the sie othe rst team suad, with more than hal (53%) o respondentsbudgeting or a smaller rst team suad next season. A urther 43%expect to keep it the same sie, while just 5% expect a larger suad.

None o the FLC and SPL respondents expect to have a larger rstteam suad, and 72% o FLC and 60% o SPL respondents will becutting the sie o the rst team.

24. i t 2013/14 p ,t t p t t tt q t t jt ?


More 17 42 6 14 18 0

Same 27 33 16 36 29 20

Less 56 25 78 50 53 80

Base: 66

Not surprisingly, given that 53% o respondents are budgeting or asmaller suad, 56% overall are planning to spend less on the payrollcost but this gures is as high as 78% or FLC and 80% or SPLrespondents.

However, more than our out o ten (42%) o EPL clubs will bespending more on their payroll (up rom 33% in 2012), despite only8% expecting larger suads. This is a clear indication that playersalary infation is still prevalent in the EPL.

o respondents arereducing or maintainingtheir transer budgets

PROJECTED SIzE OF FIRSTTEAM SqUAD FOR 2013/14

88%

25. i p t p t p t t t t q t2013/14 , t t tt t

p ?% a ePl lc l1 l2 sPl

Not at all 58 14 23 75 93 1 00

Yes, to some extent 31 72 59 8 7 0

Yes, to a considerable extent 11 14 18 17 0 0

Base: 55

42% o clubs admit that their decision not to increase payroll spendon the rst team suad has been partly or largely driven by the FF Prules, but there is a divide between the larger teams 86% and 77%o EPL and FLC clubs versus just 25% and 7% o FL1 and FL2 clubs.

26. w / t t

t ?


Increase 12 25 6 14 12 0

Same 64 50 50 65 76 100

Reduce 24 25 44 21 12 0

Base: 66

The trend towards controlling the transer budget continues this year

with nearly two thirds (64%) o respondents keeping their transerbudget the same as last year (up rom 52% in 2012) and a uarter (24%) reducing it. Only 12% will increase their transer budget this year.

53SMALLER

% 42SAME

%

5LARGER

%



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Football survey 2013 24

corporate governance

28. d t -t pt t?


Yes 15 33 6 7 12 40

No 85 67 94 93 88 60

Base: 66

Only 15% o respondents have remunerated nonexecutiveindependent directors on their clubs board. This rises to a third o EPLand 40% o SPL respondents.

In a ollow on uestion, almost all (92%) respondents regard theirootball club as a public interest business with a high degree o scrutiny.

29. d t p tt t t t tpt p t z p t t t t?


Yes 64 67 67 50 76 40

No 36 33 33 50 24 60

Base: 66

Nearly two thirds (64%) agreed that the level o public interestin their club leads them to manage the club with a higher level ocorporate governance than they would or a similar sied businessoutside the ootball sector.

social media

30. h ptt t tt t ?


Low importance 5 0 6 7 0 20

Medium importance 30 0 38 29 41 40

High importance 65 100 56 64 59 40

Base: 66

Two thirds o respondents (65%) say that social media is a veryimportant contributor to the promotion o the clubs brand. Thispercentage rises to 100% o EPL clubs.

31. d t pppt k tpt ?


Yes 82 92 94 64 76 80

No 18 8 6 36 24 20

Base: 66

More than eight out o ten clubs (82%) say that they have theappropriate skills to exploit the benets o social media. Thiscondence in skill levels rises to 92% o EPL and 94% o FLC

respondents.

82%To some extent, the perceived

higher than average level o publicinterest aced by ootball clubsmaniests itsel in a ocus on goodcorporate governance, as refected inthe relatively high (15%) number opaid nonexecutive directors(note that this excluded unpaid nonexecutive directors). However, thedirection o travel or the UK is anincreased level o commitment tocorporate governance so we watchwith interest to see i the statisticincreases in uture years.

t b

o respondents say theyhave the skills to exploitthe benets o social media

Football survey 2013 24Football survey 201323


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Our team o sector experts which includes partners with experienceo managing and running top fight ootball clubs, can provide ootballclubs with a complete range o business advisory services including:

our sPecialisT services include:

CorporaTe fInanCe and fInanCIal ModellIngWe have signicant experience providing transaction advisory andinvestigative services across all proessional leagues to a numbero Clubs or both vendors and acuirers. Our specialist transactionservices team perorms due diligence or potential investors and orFFP planning and compliance, and our advisory team specialises inleading sales processes and procuring investment.

BusIness resTruCTurIngWe have been appointed Administrators o a number o clubsincluding Motherwell, Oldham Athletic, Dundee and most recentlyPortsmouth, Dunermline and Hearts. All completed appointmentshave led to a successul outcome whereby a dividend was acceptedby creditors under a Company Voluntary Arrangement (CVA). Allcompanies survived ollowing the CVAs and are continuing to trade.

speCIalIsT VaT C onsulTanCySome o our recent assignments have included providing extensiveVAT input on the ollowing:

Anity card agreements

Overseas sponsorship issues

Testimonial/benet games or current and ormer players

Stadium reurbishments and alternative uses, catering issues,retail sales

Agents eesWe have produced a VAT overview guide or clients in connectionwith a number o rules and treatments, including the place o supplyo goods & services, plus certain VAT reporting reuirements and amatrix relating to the key income streams.

bdo Proessional sPorTs grouP

scoTland

Proessional sPorTs grouP Key conTacTsFor more inormation on any o our services or the ootball industry, contact the relevant BDO expert in your region.

charlesb arnett

Audit /Corp Finance

T:0141 249 5233

andymcnamara

Audit

T:0141 249 5249

bryanJackson

BusinessRestructuringT:0141 249 5203

brian lovie

Tax

T:0131 347 0366

trevor birch

BusinessRestructuring

T:020 7893 3733

tim Ferris

Corporate TaxT:020 7893 2372

andy goodman

Employment Tax

T:020 7893 3437

ian clayden

Audit

T:02078933612

ian cooper

Corporate Finance

T:020 7893 2678

James roberts

Audit / Corp Finance

T:01293 591087

stuart lisle

Tax

T:023 8088 1861

Jim gee

Forensic

T:020 7893 2830

souTh

billy cairns

Tax

T:0113 204 1306

Julien rye

Audit

T:0161 817 7505

chris heatlie

Corporate Finance

T:0161 833 8362

norTh / norTh midlandslondon / souTh midlands

eMployMenT TaxOver the last twelve months our team o specialists has providedadvice in connection with the complex area o reward. This is inthe light o heightened HMRC interest into the use o complex andconvoluted remuneration structures sometimes involving EmployerFinanced Retirement Benet Schemes (EFRBs), Employee BenetTrusts (EBTs), contracts or dierence and the use o Image RightsCompanies. We have also assisted clubs with investigations into theuse o such structures by HMRC Specialist Investigations. Obviously,in their day to day business, many clubs make payments to sportsagents and we have advised clubs on how these should be correctlydealt with or income tax and national insurance purposes.

CorporaTe goVernanCe

Good corporate governance is essential i clubs are to be managedeectively by executive directors and legal obligations dischargedproperly by nonexecutive directors. Procedural issues include:

Transer policy Auisitions and disposals

Disciplining regulations and rules players and directors

Fraud protection

Antimoney laundering

Cost control regulation

Transparency measures

Diversity and community

forensIC and fraud InVesTIgaTIons

We provide orensic accountancy, investigatory and expert witnessservices to a number o clubs. Working in a partnership with theCentre or Counter Fraud Studies at the University o Portsmouth,we are also able to help organisations to measure and reduce thecost o raud. We deliver real nancial benets oten achieving a 12:1return on the cost o the work.

External and internal audit Corporate tax Corporate nance and nancial modelling Business Restructuring Specialist VAT consultancy Employment tax Corporate governance Forensic and raud investigations



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BeTTIng & gaMIng

BDO has acted as auditors, tax advisers and consultants to many UKand international betting and gaming businesses, both private andpublicly uoted. Our clients range rom many o the major bricks& mortar bookmaking and casino operators to major oshoretelephone and internet sports books, casinos, poker and other onlinegaming activities. As well as the more traditional orms o bettingand gaming, we also act or FSA regulated businesses in the nancialtrading, nancial spread betting and CFD sector.

Specialist advice we can provide to the sector includes:

International tax planning and structuring

Corporate nancing and fotations

Property and corporate acuisitions and disposals

Financial Services Act regulations and compliance

Installation o management reporting and controls andinternal audit unctions

IT controls, environment reviews and systemsimprovement advice.

hoTels

Our expertise covers the entire spectrum o investment and operatingactivities and our involvement brings credibility, competence andindependence to any project. In short, i you are active in the hotelindustry then you should be talking to BDO, the industry experts.

Specialist advice we can provide to the sector includes:

Audit and assurance

Feasibility studies

Business valuations

Litigation support and expert witness services

Mergers and acuisitions including MBOs, MBIs and fotations

Fund raising and renancing

Financial investigations and dispute resolutions

Systems reviews

Turnaround and distressed situations

bdo leisure and hosPiTaliTy

alongside the proFessional sports group, our team works with international businesses across the

leisure industries, including betting & gaming, hotels, restaurants, bars & pubs, and travel & tourism.

John barKerTEL: 020 7893 3980

EMAIL: [email protected]

sTuarT collinsTEL: 020 7893 2604


david camPbellTEL: 020 7893 3610


dominic sTammersTEL: 020 7893 2471


resTauranTs, Bars & puBs

BDO can help realise the opportunities and minimise the pressures just as we have helped numerous clients to do, during our longestablished history as a leading adviser in this sector.

We have advised clients as diverse as international brands andnational chains, to owner managed businesses and outlets looking toexpand and/or diversiy. Our expertise will assist whether you are theindividual restaurateur, the group operator, the restaurant ranchisoror ranchisee.

Specialist advice we can provide or your sector includes:

BERR report, TRONCS, minimum wage legislation

Tax ecient employee incentive plans

Property issues and the associated stamp duty andcapital allowances

Business acuisitions

Raising nance or business expansion public and private,euity and debt

Franchise advice

TraVel & TourIsM

The travel sector has undergone some o the biggest changes we havewitnessed to one particular industry over the last ew years. It has beena rollercoaster ride o new entrants and new technology, consolidationand unpredicted new challenges to business, such as SARS andterrorism. BDO has helped its travel clients turn a turbulent time intoone o opportunity.

Our commitment to this sector has seen us attract some o thebest known names in the business rom owner managed privatebusinesses through to large listed companies with internationalnetworks. BDO is an ABTA Travel Industry Partner and provides thesection on Travel Agents and Tour Operators or Butterworths FinancialReporting and Accounting or Specialised Sectors. We have memberson the ICAEW / ABTA Working Group instigated by ABTA and also onthe ICAEW/CAA Working Group instigated by the CAA.

Specialist advice we can provide or your sector includes:

ATOL applications

Tour Operator Margin Scheme Industry regulation and compliance

Flotations, acuisitions and disposals

Tax planning and compliance or the travel industry

Business continuity planning



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contactF :

charLes barnettpartner, professionaL sports(scotLand)t: 0141 249 5233e: [email protected]

ian cLaydenpartner, professionaL sports(engLand)t: 020 7893 3612e: ian [email protected]

trevor birchpartner, professionaL sports

(business restructuring)t: 020 7893 3733e: [email protected]

(See ull list o contacts on page 25)

This publication has been careully prepared, but it has been written in generalterms and should be seen as broad guidance only. The publication cannot berelied upon to cover specic situations and you should not act, or rerain romacting, upon the inormation contained therein without obtaining specicproessional advice. Please contact BDO LLP to discuss these matters in thecontext o your particular circumstances. BDO LLP, its partners, employees andagents do not accept or assume any liability or duty o care or any loss arisingrom any action taken or not taken by anyone in reliance on the inormation inthis publication or or any decision based on it.

BDO LLP, a UK limited liability partnership registered in England and Walesunder number OC305127, is a member o BDO International Limited, a UKcompany limited by guarantee, and orms part o the international BDOnetwork o independent member rms. A list o members names is open toinspection at our registered oce, 55 Baker Street, London W1U 7EU. BDOLLP is authorised and regulated by the Financial Services Authority to conductinvestment business.

BDO is the brand name o the BDO network and or each o the BDO MemberFirms.

BDO Northern Ireland, a partnership ormed in and under the laws o

Northern Ireland, is licensed to operate within the international BDO networko independent member rms.

August 2013 BDO LLP. All rights reserved.

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A new dawn for Fair Play? The annual survey of Football club Finance Directors (BDO, 2013)

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Transcript of A new dawn for Fair Play? The annual survey of Football club Finance Directors (BDO, 2013)