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Football FDs 'more focused on governance'

23/08/13

The world of international football has changed massively in the last three decades, with an influx of money making it a major economic player and fundamentally altering the way clubs are structured.

While this means it is a fruitful industry for corporate finance professionals to get involved in, it also offers a unique series of challenges and demands on industry experts, according to a new report from accountancy network BDO.

In its annual survey of the sector, A New Dawn for Fair Play, nearly two thirds of the 66 finance directors (FDs) surveyed argued that they are more focused on corporate governance than their counterparts in other industries because of the intense public and media scrutiny placed on the football world.

Trevor Birch, insolvency partner at BDO and lead practitioner on the Portsmouth FC administration, said: "To some extent, the perceived higher than average level of public interest faced by football clubs manifests itself in a focus on good corporate governance, as reflected in the relatively high number of paid non-executive directors."

While the industry often receives bad press about its financial planning, with examples such as the aforementioned Portsmouth administration sticking out as particularly badly-run situations, BDO argued that these crises have led to more responsible and intelligent work at a board-room level.

This new attitude could be bolstered by the new Financial Fair Play rules from UEFA, which includes requirements such as a cap on owners injecting equity, overspending and losses - intended to stop the kind of overspending that got Portsmouth into trouble.

"Stakeholders are crying out for a sustainable business model and it can only be hoped that the regulations are embraced not just in letter but in spirit," declared Mr Birch.

However, outside of the top leagues problems still exist - only three out of ten FDs rate their club as financially 'very healthy', while half said it could be better, highlighting the worrying funding gap across the Football League.

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