Accounting for football - let's give it a shot. A delineation of financial statements within Swedish football clubs

Abstract

Background and problem: In today’s business climate the importance of producing and presenting a settled accounting is growing. This also concerns the Swedish football clubs as their turnovers are increasing. The subject is of interest, since the business of football has come under an ever-increasing scrutiny from both media and other interested parties, such as creditors, sponsors, fans etc. The guidelines set by the Swedish Football Association (SvFF) demands that the clubs show healthy finances. This raises the question of how Swedish football clubs could improve their financial statements to better present their real financial value. This implies that the statements fulfill the fundamental qualities of accounting, follow valid legislation and give comparable and explicit supplemental disclosure.

Purpose: The purpose is to present suggestions on how Swedish football clubs can improve their accounting and produce financial statements that will better present the financial value and future potential of the club.

Delimitations: Focus is put on the Swedish football clubs in the premier division. Further, only male football is included. Taxation is of no interest, since most of the Swedish clubs are operated as non-profit associations. The study concentrates on the improvement of the financial statements and no proposals are made regarding how the current recordings could be improved. No emphasis has been put on how the accounting would change if the legal form of business entity changed.

Method: The study has been conducted through the comparison of the financial statements. These have been analyzed and investigated by looking into existing and applicable regulations and theories within the area. Interviews with auditors, football clubs and SvFF have been undertaken in order to get their opinions on the subject. The final discussion has been held with the theoretical and institutional framework as a foundation.

Result and conclusions: The results suggest that the football clubs, in many aspects, fail to follow existing legislation and the guidelines from SvFF. These errors obstruct the statements from fulfilling the fundamental qualities of accounting. The delineation further shows that the supplemental information in the statements is very scarce. Values that are not to be accounted for on the balanced sheet could be presented in supplementary disclosure. The financial statements should always follow existing legislation and this has ACCOUNTING FOR FOOTBALL to be done to a greater extent by the clubs. This could be achieved if SvFF assumed greater responsibility

Suggestions for further research: It would be interesting to see how the implementation if the IAS-standards will affect Swedish football clubs. Both human resource accounting and player valuation are areas where further research would be of interest.