Debts Are A Concern Says Uni Expert

07 June 2011 12:59
Uni Professor On City's debts Warwick University's Professor Wyn Grant has said that the latest accounts declared by Coventry City at Companies House where the auditor says the accounts cast doubt on the club's abilty to continue as a going concern, are gravely concering. Speaking to the CT, Professor Grant who specialises in football business said : “This is a very serious situation for Coventry City Football Club. It is very rare for independent auditors to express the view given in this report. “While it is serious, it could be retrieved, but that is dependent on whether they are able to attract investment. “They are very much in a catch 22 situation.  "They need to operate successfully, but without the money to do so, will they be able to? “The directors are saying that they want to stay in the Championship and reach the play-offs, but revenue has fallen and the problem they face is how to attract fans back. “They say that they are trying to secure finance, but it is whether they can do that. If the club had stakes in the Ricoh Arena then the situation would look a lot more attractive to investors.” But Dr John Beech, senior research fellow in sport and tourism from Coventry University, was a little more optimistic in his outlook, describing it as a time for concern, “but not for panic. “The expression the auditors have used is one which might strike fear and alarm if it were being applied to a conventional business, but football clubs aren’t conventional businesses. “I can think of one football league club which had similar comments from its auditors on its accounts for ten consecutive years and it’s still there. “The comment really just reflects the need the club has for further investment, something which the new board is very much aware of and are pursuing. “In short, yes, there is still uncertainty about the future, but there are quite a few clubs’ accounts which make for far worse reading. "I see the comment as simply flagging up what is already a known, rather than as a dire warning of any imminent meltdown. “A measure of concern, yes; a time for panic, most definitely not. "Staying up, as the directors point out, is the key to Coventry City’s success or failure – and of course this season they have, comfortably – and, if new investment can be found to enable at least a partial purchasing of the Ricoh stadium, the future for the club should be significantly brighter.”  

Source: FOOTYMAD