The board of directors of Futbol Club Barcelona has made available to the members the audited accounts for the annual financial year closed in June, in which it presents profits of 303 million euros. A figure that seems spectacular if you take into account the problems that the organization has when making signings or registering players complying with the rules of fair play set by the Spanish League, and which have starred in the day to day of the entity the last two seasons.
A close look at the audit notes explains this apparent paradox. According to that document, specifically in a so-called “paragraph of emphasis”, the auditor points out: “It must be considered that the club has generated a result of 303 million euros this year, which includes operating profits non-recurring for the amount of 800 million euros, approximately”.
In other words, the entity has presented spectacular results from last year, although at the cost of reducing the club’s assets, especially through the sale of assets, which will result in a reduction in future income. In other words, without these asset sales and extraordinary income from the sale of players, Barça would have had losses of around 500 million.
According to accounting regulations, auditors must include an “emphasis paragraph” in their reports “when they consider it necessary to draw the attention of users of the information to an issue that is fundamental to understanding the financial statements.” It is not the first time that one of these notes has been included in Barça’s accounts, but in the one from the previous year no reference was made to the sale of assets, only to the existence of a negative net worth , which occurs when the losses exceed the rest of the items precisely because the equity decreases due to sales.
The main financial operation last year was the sale of 15% of the television rights linked to the League for 400 million, which generated profits for the same amount.
The auditor also mentions the current moment of indeterminacy of the future Barça Media IPO project and draws attention to the fact that one of the new partners in that project, Libero, has not fulfilled the promised contributions and is looking for alternatives. Although it is 40 million euros, the auditor refers to a total of 120 million. In the event that he does not comply, the club would have to assume losses already accounted for (see Sunday’s Vanguardia).
In general, all of Barça’s activities generated ordinary income last year of 805 million euros, although the club uses the total income figure, that is, including asset sales and other extraordinary ones, totaling 1,259 million.
However, ordinary expenses add up to about 1,125 million, which would leave a negative ordinary result of about 330 million, or only 70 if the sale of television rights is discounted only.
Among the most outstanding expenses is the professional staff of athletes, especially that of the first football team, which involves 625 million, depreciations on the margin.
Two aspects of the club’s expenses draw attention in the accounts for the financial year closed last year. First of all, the so-called external services, which add up to 50 million more than last year, and other current management expenses which increase by 67 million, until reaching practically 100 million. They include everything from image rights to commissions from player representatives.
A relevant part of the audit report focuses on the accounting and analysis of the financing of Espai Barça, especially the construction works of the new Camp Nou. The total operation has an estimated total cost of 1,500 million, which Barça is financing with debt. The accounting of these new commitments has the consequence that the club’s balance sheet grows, practically doubling, and goes from 1,400 to 2,800 million.
To issue this debt, the investors and the club agreed to create a vehicle that issues the titles and contributes the money as required by the development of the works, which is carried out by the Turkish company Limak. In last year’s financial year, according to the report, the club had 207 million.
