Trust Email on Football Finance and Governance

Interesting email from the Trust to its members about Football Finance, some of the shenanigans other clubs have got up to in trying to "cook the books", powers of the Regulator and CCFC's new financial targets as a result of relegation

The Future of Football and Finance

Dear Member

As a Chartered Accountant and a member of the ICAEW (Institute of Chartered Accountants in England and Wales) Entertainment, Sport and Media group, I was invited to join in a live stream on the above topic at Chartered Accountants Hall in London. The event took place on the evening of 30 April 2025.

The meeting was lengthy and so this report is in summary form but covers all the main points discussed.

The speakers
Keiran Maguire and Jonathan Brown – both leading experts on football finances.
Dame Caroline Dineage – Chair of the Government Culture, Media and Sport Committee (CMS)
Adam Crockett – Director of the Football Finance Bill (currently at an advanced stage of its progress through Parliament) and Head of Football Regulation policy at the Department of Culture Media and Sport

The topics covered

Kevin Maguire gave the following background to finances in football in the Premier League since it started in 1992:-
Premier League income has gone up by 3,013% but wages up by 3,973% and transfer spend up by 4,407%. Premier League clubs now owe over £3.1billion in unpaid transfer fees.

In the Championship things are no better. Despite income going up by 1,106% over the period, Championship wages alone have exceeded income in 9 of the last 12 years and average Championship club losses are now over £500k a week.

Keiran gave some examples of clubs trying to artificially reduce reported losses and get around Financial Fair Play and Profitability rules.

Derby wrote off the value of its players (amortisation) over periods of up to 8 years rather than over the length of their contracts (usually 3 years) to reduce the annual cost in their accounts.

Sheffield Wednesday effectively sold back their stadium to themselves through a connected party at a false figure rather than market value.

Everton sold the naming rights to their new stadium and included the income in their accounts before the stadium had even obtained planning permission.

Leicester extended their financial year from 12 to 13 months so that it partly covered a period in the Championship and the Premier League so that neither could penalise them for breaches of the financial rules.

Chelsea tried to get around their PSR issues by selling their stadium at an inflated value to another company in their “group”. Without that deal their annual loss would have £166m.

Other clubs have tried “swap deals” recently at high (artificially high?) transfer values which are not really swaps as the players concerned don’t actually move clubs. This was done because the full proceeds of sale are included in the year of “sale” but the cost of “purchase” can be spread over the player contract period.

Jonathan Brown then spoke about FFP and PSR, their limits and some more examples of club attempts to get around them.

UEFA allows average annual losses over a 3 year rolling period of £5m which can increase to £45m if the club owners put in new share capital for the balance.

The Premier League allows annual average losses of £15m which can go up to £35m if owners put in new funds in a similar manner.

Championship clubs can lose £5m annually which can go up to £13m if the owners put equity cash in similarly.

N.B. Now that Cardiff City are in League One we are not covered by limitations on overall losses as determined by Championship regulations but will be required to spend on player wages up to a maximum of 60% of total income. This will require a significant overhaul to the finances of the Club.


Adam Crockett and Dame Caroline Dineage both discussed the progress of the Football Governance Bill and the reasons why it has had to be brought in.

The key issues have been to try and protect clubs that might otherwise suffer severe financial problems as many tend to run out of cash before their financial year or season end and a (limited) number had what they described as “rogue” owners.

The Bill will require clubs wishing to operate in the top 5 divisions of professional football to hold an Operating Licence which will only be granted by the Regulator if clubs comply with a number of conditions -financial, non financial, a stronger owner and director test and fan engagement on key strategic issues.

Breaches of the new legislation will not lead to points deductions as that will be for the existing football authorities to impose. However, the Regulator will have the even more powerful sanction of withdrawing the Operating Licence for major breaches. It goes without saying that this is a significant development.

N.B. a specific question I asked resulted in an encouraging answer. If clubs say they have consulted with fans but haven’t really, then the elected fans group will have the right to report this direct to the Regulator who will fully investigate the matter.

Current progress of the Bill

The Bill has already completed its passage through the House of Lords (with over 300 amendments , but nothing major) , 2 readings through the House of Commons and is now at Committee stage there which is likely to take a couple of months, After that there will be a 3rd reading before rapidly progressing through its final stages to enactment. Both senior politicians at this meeting expressed their strong opinion that this will fully go through predominantly in its current format.

The Government have already appointed Martyn Henderson as Chief Operating Officer for the Regulator team and have also put forward David Kogan as their preferred candidate for the Chair role.

It is critical that the Trust keeps up to date in respect of all such strategic developments in legislation regarding the running of Football Clubs so that we can keep members informed as to how they may effect Cardiff City FC. I will further report back to you with developments as and when they occur.

Keith Morgan
CCST Chair

Thanks for sharing that, it's very informative.

Those examples of creative accounting really should have resulted in points deductions

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Originally Posted by PontBlue

Thanks for sharing that, it's very informative.

Those examples of creative accounting really should have resulted in points deductions

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Whilst the "creative accounting" info is interesting the most important parts of the email are the League 1 rules about wages having to be no more than 60% of income. With the loss of significant Sky income it is likely to mean that we will have to offload high earners whether we like it or not. Also the powers of the Regulator to withdraw a Club's Operating Licence is significant. I don't think our Corporate Governanace stands up to close scrutiny or fan engagement for that matter. Where was the consultation regarding season tickets for next year ?

The financial structure of many clubs is far too complicated for any lay man to understand. There's clever accountants and advisors who can devise structures that stretch the rules just as those examples show.

As an aside Kieran Maguire is a massive fan of The Mission. He was on tv once talking about his own book and had Wayne Hussey's memoir Salad Daze strategically placed behind him. I tweeted him about it and replied talking about his love of all things goth.

IIRC Chelsea also sold their ladies team to another member of their group and used the ‘income’ to help fudge their financial situation.