Liverpool £90m losses between 2011-2013 might not have breached Uefa’s Financial Fair Play regulations The club could be expelled from Europe, but FFP examination should reveal significant exemptions and inherited bills Just when Liverpool look like getting back into the Champions League for the first time in four years, they release annual accounts that could get them kicked out again. But, as followers of Manchester City and Chelsea are fast realising, massive losses do not necessarily equate to a breach of Uefa’s Financial Fair Play regulations – for which expulsion from Europe is the ultimate sanction On the face of it, Liverpool’s £90 million-plus loss between 2011 and 2013 is well in excess of the £37m FFP allows them to lose during that period, and the period 2011-14. However, spending on infrastructure is exempt from FFP calculations and, as any Liverpool supporter worthy of the name knows, the club have wasted millions on stadium-related projects in the last seven years. Despite ousting George Gillett and Tom Hicks as owners almost three-and-a-half years ago, Liverpool’s accounts show they were still saddled with debt related to aborted attempts to build a new ground at Stanley Park. An interest-free, inter-company loan of £46.8m from parent company Fenway Sports Group was used to pay off debts from such projects dating back to the Gillett and Hicks regime. When it comes to FFP, exactly how much money can be deducted from the £49.8m loss Liverpool announced overnight is something Uefa’s Club Financial Control Body will determine when it comes to forensically examine Liverpool’s 2011-14 accounts this time next year. Those deductions will include other exemptions, such as investment in youth development, while the club are expected to plough even more money into the redevelopment of Anfield in the near future. Their income, meanwhile, will also be boosted by their share of year one of the massive new £5.5 billion broadcast deal which began this season, although they will have to wait for a potential £30m of Champions League riches until next year. Interestingly, their financial statement does include a forecast for the current season relating to transfers and wages – which are undoubtedly covered by FFP. Liverpool revealed their transfer and contract activity – including the extention of Luis Suarez’s deal – cost them £53.3m. How much that affects their ability to meet FFP will only become clear this time next year.
Posted on: Wed, 05 Mar 2014 07:11:19 +0000
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