Readings New Black Hole in Accounts

[Sir Dodger Royal]

Reading FC's pre-tax losses have more than doubled and are almost at the same level as their turnover, the Premier League club's latest accounts have revealed.

Accounts for the Reading Football Club Ltd show the club had a turnover of £14.8m in the year to 30 June 2012, down from £17.2m in the previous year.

But losses on ordinary activities before tax increased from £5m in 2011 to £11.7m. Staff wages last season amounted to £23.4m, up from £16.2m in the previous year.

The widening losses came as Reading pushed for promotion from the Championship. And after securing promotion in April 2012, the club were sold to Thames Sports Investments Ltd a month later.

"The board acknowledges this and recognises that to remain competitive it needs to continue to invest in players while managing the costs associated with this within the financial constraints the company faces," the club's directors' report said.

The Royals' directors added they have "continued to manage a significant shortfall in working capital requirements in a prudent, long term manner".

In a statement with the accounts, chairman Sir John Madejski said: "Early in 2012 we received investment from Thames Sport Investment and this summer we were delighted to officially welcome in a new sea and owner Anton Zingarevich.

"Anton's arrival has signalled a period of positive change at Reading and his input has been integral in helping the club move forward.

"Investment, which by the very nature of modern day football is what every club needs to succeed, will now allow us to build as opposed to rebuild every season, offering us stability alongside progress and growth helping us to strengthen in terms of our squad as well as the club's infrastructure and our burgeoning academy systems."

Earlier this week, Reading sacked manager Brian McDermott. The club currently sit 19th in the Premier League.

SDR:
Little detail in this release but the Madman get's the other half of the Buy Out Money in September 2013 so egt ready for RFC saying they are skint come August with a Black Hole in the Balance Sheet.
At least at present we have few decent players to sell but exits will be on the cards. Of course there is £22mill relegation money for the next three years but we tend to ignore that as a minor detail. The slide is onnnnnnnn and will continue next seasonnnnnnnnnnnn

[Webster750]

SDR:
Little detail in this release but the Madman get's the other half of the Buy Out Money in September 2013 so egt ready for RFC saying they are skint come August with a Black Hole in the Balance Sheet.
At least at present we have few decent players to sell but exists will be on the cards. Of course there is £22mill relegation money for the next three years but we tend to ignore that as a minor detail. The slide is onnnnnnnn and will continue next seasonnnnnnnnnnnn

Real facts, real worlddddddd

[Silver Fox]

Fuccccckkkkkk offffffff

[Gordons Cumming]

SDR

Mr Positive.

[Sir Dodger Royal]

The Real Facts are always painful. Get a life.
Listen to Dodger.

[Gordons Cumming]

The Real Facts are always painful. Get a life.
Listen to Dodger.

Does it always have to be you?

[Harpers So Solid Crew]

so we took a chance on promotion, then paid bonuses to players and staff alike, that wouldm explain a lot of the loss, which will; be covered by the Prem money that we get this year, it would be hard to pay the bonuses from Championship money, IMHO. so overall a wasted thread.

[SPARTA]

RFC haven't received their Sky TV money yet, so a balance pre-TSI is pretty pointless to be honest. I'll be more interested in the figures after this season's net spend vs outgoings.

[PieEater]

It doesn't include the premiership cash but I'd be worried about the fall in turnover, and this years won't be much different as we fixed the bulk of ST prices at the same level.

[Esteban]

Wouldn't last years' turnover include the FA cup quarter final and play-offs (including the added bonus of getting all of the Wembley money). Doesn't this account for the reduction in turnover?

[Dick Habbin's hairdo]

RFC haven't received their Sky TV money yet, so a balance pre-TSI is pretty pointless to be honest. I'll be more interested in the figures after this season's net spend vs outgoings.

This. And even that doesn't take into account the "long term investment" planning. However, that all depends in getting out of the Chumpionship and back into the Premier Leaage - as opposed to League 1 - and we all know what a bastard league the Chump is.

This season is the single most critical ever - period - to remain in the Prem given the influx of extra spondoolies next season. It will be very, very hard for any club to make the step up in the future.

[LoyalRoyalFan]

This only proves that the takeover was a positive thing, and will help the club in the long run.

[72 bus]

This season is the single most critical ever - period - to remain in the Prem given the influx of extra spondoolies next season. It will be very, very hard for any club to make the step up in the future.

Three clubs will manage to do it, as usual

[Nomad_Royal]

Almost worse than the pain of relegation (if it happens), almost worse than the painful Premiership defeats week in week out or the loss of a decent man like Brian as our Manager, the abandonment of the Reading way in terms of sticking with our principles and worse than the consequent ridicule from other fans at the timing of the sacking decision

Almost worse than all of that is the cast iron certainty that bad news will tempt SDR and his sidekick WSF out from the stone they have been hiding under while things have gone well. Please disappear back there ....soon

[Caskeys Lovechild]

FFS....More newspaper bullshit.

FYI My business makes a healthy profit on its activities. When I'm doing the accounts, I make sure that it makes as little profit as possible - whether that be by paying into loans from the directors, or large capital expenditure purchases, or whatever - the less profit I can report, the better....

Why?

Because businesses are taxed on profit. Make yourself look like a loss making business, and HMRC can't charge you anything - make a major loss, and it has a knock on effect on the following years tax too.

This is the most ridiculous non event in the history of the world. The more of a loss that RFC makes in the accounts for the championship year, the more of the Premier League money they don't have to pay in tax.

[melonhead]

also- we probably only really had a better balance book the year before to which these figures are compared because we were still trying to make the business look as attractive as possible to prospective new owners

[MouldyRoyal]

This thread title is misleading, it's not a new black hole at all. Old one just got a bit bigger.

[Royal Rother]

also- we probably only really had a better balance book the year before to which these figures are compared because we were still trying to make the business look as attractive as possible to prospective new owners

I doubt it. The accounts are what they are - the policies will remain consistent year after year.

And in any case, due diligence completely negates any stab at that sort of practice so it's really not worth the effort.

[bobbybottler]

The Real Facts are always painful. Get a life.
Listen to Dodger.

Sign Gary Alexander and watch Reading flyyyyyyyyyyyyyyyy

[Caskeys Lovechild]

also- we probably only really had a better balance book the year before to which these figures are compared because we were still trying to make the business look as attractive as possible to prospective new owners

I doubt it. The accounts are what they are - the policies will remain consistent year after year.

And in any case, due diligence completely negates any stab at that sort of practice so it's really not worth the effort.

Not at all - you change the accounting policies to best negotiate the tax rules at the time, thus saving millions in corp tax.
If the figures suggested that the club is making any kind of profit year in year out, THEN I'd be worried, as it means the accountants aren't doing their jobs properly!!