The implications of the new MFA financial reporting regulations to the applicable member clubs

Abstract

Purpose – The research study aims to obtain an understanding of the reporting requirements for local football clubs, to identify the main motives behind the changes recently undertaken in the financial regulations governing local football clubs and to identify the implications and reactions of this change and how it was perceived by the applicable member clubs. Design – In the attempt of addressing the objectives of the study, 14 interviews were held with club representatives who fell within the parameters of these amendments. An in-depth interviewee with a member of staff within the Malta Football Association was also carried out to address the second objective of the study. Findings – The main findings suggest that the main goal of these amendments was to increase the number of local clubs applying for the UEFA licence. The Association transposed provisions found within the UEFA Financial Fair Play rules into the domestic licence with some exceptions such as the break-even requirement which was not adopted. Most of the provisions were welcomed while other sparked discussions on their applicability and utility within the local scenario. Conclusion – The findings demonstrate that a shift towards a more serious and business-like framework was needed as it was welcomed by a large majority of the respondents. The identified costs of compliance arising from the amendments match the salient changes; the independent audit requirement, the increase in disclosure requirements and tax compliance. Implications – The amendments in the financial regulations have the ability to start a new era for local football as the move towards professionalism brings about a number of beneficial implications. Football club incorporation was a popular comment earmarked throughout the interviews with member clubs. The updated financial regulations may serve as an optimal platform where clubs may eventually shift to incorporation, thus developing and expanding the local game.