F.5 Notes to the financial statements - Club Licensing

F.5.1

Notes to the annual financial statements must be presented in a systematic manner. Each item on the face of the balance sheet, profit and loss account and cash flow statement must be cross-referenced to any related information in the notes. The minimum requirements for disclosure in notes are as follows:

1. Accounting policies

   The basis of preparation of the financial statements and a summary of the significant accounting policies used.

2. Tangible assets

   Each class of tangible asset must be disclosed separately, e.g. property, stadium and equipment, and right-of-use assets.

   The following information must be disclosed for each class of tangible asset:

   1. The gross carrying amount and the accumulated depreciation (aggregated with accumulated impairment losses) at the beginning and end of the period; and

   2. A reconciliation of the carrying amount at the beginning and the end of the period, showing additions, disposals, increases or decreases during the period resulting from revaluations, any impairment losses recognised in the profit and loss account during the period, any impairment losses reversed in the profit and loss account during the period, and depreciation.

      The depreciation methods and useful lives (or depreciation rates) used must be disclosed in the accounting policy notes.

3. Intangible assets

   Each class of intangible asset must be disclosed separately e.g. player registrations, goodwill, and other intangible assets.

   The following information must be disclosed for each class of intangible asset:

   1. The gross carrying amount and the accumulated amortisation (aggregated with accumulated impairment losses) at the beginning and end of the period; and

   2. A reconciliation of the carrying amount at the beginning and the end of the period, showing additions, disposals, any decreases during the period resulting from impairment losses recognised in the profit and loss account during the period, and amortisation.

      See Annex G for further information on accounting requirements for player registrations.

4. Pledged revenues and assets

   The reporting entity must disclose:

   1. The existence and amounts of restrictions on title, and property, plant and equipment (such as the stadium and training facilities) pledged as security for liabilities or contingent liabilities;

   2. The existence and carrying amounts of intangible assets whose title is restricted and the carrying amount of intangible assets (such as player registrations) pledged as security for liabilities or contingent liabilities; and

   3. The existence and carrying amount of financial assets and/or amount of future income (such as receivables and future income in respect of disposal of a player’s registration, competition distributions/prize money, season ticket and other gate receipts, broadcasting rights and sponsorship arrangements) pledged as security for liabilities or contingent liabilities.

5. Investments

   Investments must include investments in subsidiaries, jointly controlled entities and associates. In respect of investments in subsidiaries, jointly controlled entities and associates, the following information must be disclosed as a minimum for each investment:

   1. Name;

   2. Country of incorporation or residence;

   3. Type of business/operations of the entity;

   4. Proportion of ownership interest;

   5. If different, proportion of voting power held; and

   6. Description of the method used to account for the investments.

6. Bank overdrafts and loans

   For each class of financial liability the following must be disclosed:

   1. Information about the extent and nature of the financial instruments, including amounts and duration and any significant terms and conditions that may affect the amount, timing and certainty of future cash flows; and

   2. The accounting policies and methods adopted, including the criteria for recognition and the basis of measurement applied.

7. Provisions

   Provisions must be disclosed in separate classes. In determining which provisions may be aggregated to form a class, it is necessary to consider whether the nature of the items is sufficiently similar to be combined in a statement of a single amount.

   For each class of provision, the carrying amount at the beginning and end of the period, the amount utilised and any amount released, or credited, in the period must be disclosed.

8. Issued capital and reserves

   Share capital, revaluation reserves, other reserves and retained earnings must be disclosed separately.

   1. Share/fund capital

      In relation to share capital issued during the reporting period, the following must be disclosed:

      - Number and type of shares issued;

      - Share premium (if applicable) arising on the shares issued;

      - Total amount raised as a result of the issuing of shares;

      - Reason for the issuing of new shares.

   2. Revaluation reserves

      Where items of property, stadium, equipment and/or intangible assets are stated at revalued amounts, the revaluation surplus, indicating the change for the reporting period and any restrictions on the distribution of the balance to shareholders, must be disclosed.

   3. Other reserves

      Any other form of reserves that is not contained in revaluation reserves, including any changes for the reporting period and any restrictions on the distribution of the balance to shareholders, must be disclosed.

   4. Retained earnings

      The balance of retained earnings, i.e. accumulated profit or loss at the beginning of the reporting period and at the balance sheet date, and changes during the reporting period must be disclosed.

9. Controlling party and ultimate controlling party

   When the reporting entity is controlled by another party, the related party relationship and the name of that party must be disclosed and, if different, that of the ultimate controlling party. This information must be disclosed irrespective of whether any transactions have taken place between the reporting entity and the controlling party or parties.

10. Related-party transactions

    A related-party transaction means a transfer of resources, services or obligations between related parties, regardless of whether a price has been charged. A related-party transaction may or may not have taken place at fair value.

    If there has been one or more related party transactions during the reporting period, the reporting entity must disclose the nature of the related party relationship, as well as information about the transaction(s) and outstanding balances, including commitments, necessary for an understanding of the potential effect of the relationship on the financial statements. Items of a similar nature may be disclosed in aggregate except when separate disclosure is necessary to understand the effects of related-party transactions on the financial statements of the reporting entity.

    As a minimum, disclosures for each related party must include:

    1. the amount and the nature of the transaction(s);

    2. the amount of outstanding balances, including commitments, and:

       - their terms and conditions, including whether they are secured, and the nature of the consideration to be provided in settlement; and

       - details of any guarantees given or received;

    3. provisions for doubtful debts related to the amount of outstanding balances; and

    4. the expense recognised during the period in respect of bad or doubtful debts due from related parties.

       The disclosures required must be made separately for each of the following categories:

       - The parent;

       - Entities with joint control or significant influence over the reporting entity;

       - Subsidiaries;

       - Associates;

       - Joint ventures in which the reporting entity is a venturer;

       - The entity or its parent's key management personnel; and

       - Other related parties.

       Confirmation that related-party transactions were made on terms equivalent to those that prevail in arm’s length transactions must be given if such terms can be substantiated.

11. Contingent liabilities

    Unless the possibility of any outflow in settlement is remote, for each class of contingent liability the reporting entity must disclose a brief description of the nature of the contingent liability at the annual accounting reference date and, where practicable:

    1. an estimate of its financial effect;

    2. an indication of the uncertainties relating to the amount or timing of any outflow; and

    3. the possibility of any reimbursement.

12. Events after the balance sheet date

    Material non-adjusting events after the balance sheet date must be disclosed including the nature of the event and an estimate of its financial effect, or a statement that such an estimate cannot be made. Examples of such events are:

    1. fixed-term borrowing approaching maturity without realistic prospects of renewal or repayment;

    2. substantial operating losses;

    3. discovery of material fraud or errors that show the financial statements are incorrect;

    4. management determining that it intends to liquidate the entity or to cease trading, or that it has no realistic alternative but to so do;

    5. player transactions where the amounts paid or received are material;

    6. transactions relating to property, e.g. in relation to the club’s stadium.

13. Other disclosures

    1. Agent/intermediary fees

       The total amount incurred in the reporting period in respect of or for the benefit of agents/intermediaries must be disclosed.

    2. Tax expense

       The components of tax expense must be disclosed separately. That is, the aggregate amount included in the determination of net profit or loss for the reporting period in respect of current and/or deferred tax.

    3. Miscellaneous

       Any additional information or disclosure that is not presented on the face of the balance sheet, profit and loss account or cash flow statement, but is relevant to an understanding of any of those statements and/or is required to meet the minimum financial information requirements, must be disclosed.

F.5.2

Notes to the interim financial statements consist, as a minimum, of:

1. a statement that the same accounting policies and methods of computation are followed in the interim financial statements as in the most recent annual financial statements or, if those policies or methods have been changed, a description of the nature and effect of the change;

2. notes equivalent to those in the annual financial statements as defined in Annex F.5.1; and

3. disclosure of any events or transactions that are material to an understanding of the interim period.