There are a number of ways at looking at debts. These are shown below. The one most often quoted is the last one on this page.
One way is to look at all the assets of the club. The assets are made up of the ground and the like, these are known as fixed assets. There are also the players, many clubs deem these as intangible assets. The worth of a player can go up or down and is less dependable than a fixed asset of land, or a building. Falkirk have a third asset which they classify as an investment. The assets are shown below.
Up to 2004 the club had assets of around £10,000. In 2004 Brockville was sold with the team eventually moving to Westfield after a horrendous time playing at Stenhousmuir. Westfield is viewed as an investment, it is owned in partnership with the council, and will need maintained.
As well as fixed assets there are things that are called current assets. Current assets covers money you could easily get your hands on. So this would be things like cash at the bank, or money owed to you that you expect to get in soon.
On the opposite side of things is how much the club owes, its liabilities.
These can again be split in to two, current liabilities and long-term
liabilities. Current liabilities are things that need to be paid within the next
year. Often these are not paid off within a year, and are just re-financed later
on. Long-term liabilities are things like mortgages, or other long term loans.
Long-term debt is less of an issue than short-term.
The first graph below show the balance between current assets and current
liabilities. The big leap in assets in 2003 is again down to the sale of
Brockville. The liabilities are creeping up but this is more than matched by the
rise in assets. The net figure is shown in the second graph. The drop in 2008
came from the club losing money in that year.
The next thing to look at is whether the club has the ability to cover the money it owes. So if the business had to sell all the players, then the ground, everything, would this cover all the money they owe in the next year. This is graph of how this has progressed is shown below. The figures point to club being in an excellent position.
The final way to look at debts is to look at the long term picture. This takes into account long term issues like paying off a mortgage. The graph for this is shown below. The first one shows how much debt the club owes. The debt is made up of the overdraft and all loans outstanding, be they short-term or long-term. Wonderfully Falkirk have no net debt, and in fact have money in the bank rather than owing the banks money.
The last graph shows all the assets of the club, against all the liabilities of
the club. The figures again show that the club is in an excellent position. The
ground move, and money from the sale of Brockville have transformed the club
As a comparison Dundee United have Net Liabilities of close to £4m, and Motherwell
Net Assets of £1.3m. Following the sale of Love Street St Mirren are also
in the position of having no debt. Hearts have a major problem with net liabilities of £25m.
