An analysis of the UEFA financial reporting obligations for Maltese football clubs

Abstract

Purpose: The purpose of this dissertation is to understand the financial reporting obligations that local football clubs have when applying for a Union of European Football Associations (UEFA) licence. The dissertation aims to understand how these obligations differ from when a club does not apply for a licence. The study also investigates which obligations clubs are struggling to satisfy these obligations and gives a critical discussion on the effectiveness of these regulations by seeing if the objectives of the UEFA licensing system are being reached in Malta or otherwise. Design: A qualitative research methodology was considered as the most suitable methodology to tackle the objectives of the dissertation. Semi-structured interviews were held with the MFA licensing manager and nine club representatives. The interviewed clubs consisted of those clubs who have experience in applying for the UEFA licence. The club representatives that took part in this dissertation were the preparers of the financial criteria of the licence. Findings: The findings of this study suggest that clubs were accepting and supportive of these financial reporting obligations, as these were a massive improvement on the lack of regulation that was present before. The most important difference in financial reporting obligations between domestic licences and a UEFA licence was regarded to be the requirement for clubs who were applying for the latter licence to provide a 17-month budgeted forecast whenever a club reported a negative equity figure in their financial statements. Conclusion: The research revealed that some clubs were still struggling to keep up with these obligations even though all of the participants said that these requirements were considered to be fair for local football clubs. It was concluded that the UEFA licensing system has helped clubs become more credible, transparent and accountable but ultimately was not reaching all its desired objectives for Maltese football clubs, leaving much to be desired on issues such as sustainability and going concern. Value: Given the high significance of the prize money from European competitions for local clubs, this dissertation examines what Europe’s leading football governing body is doing to help clubs develop and ensure their long-term sustainability. The dissertation provides the opinion of experienced club members and/or employees and the Malta Football Association’s licensing manager.