Managing the finances of a football club can be a complex operation.
All management activities in a football club should aim to adopt best practices in financial management. After all, the club's future is dependent on its financial viability. The size and complexity of a club will influence what is finally put in place.
The following are necessary:
- Constitutional requirement for an annual financial report
- A suitably trained treasurer
- Appropriate accounting system e.g. cash book/ ledgers/ journal
- Existence of approved bank accounts
- Cheque signing authorities - at least three registered with two signatories required at all times
- Set reporting practices for the management committee - standing agenda item for finance
- Asset register and management of assets
- Adopt an annual budget
Financial management is usually regulated by the treasurer who is responsible for reporting on what has happened to the club's funds. This usually covers a number of areas including accounts, match day, sponsorship, fundraising and insurance.
You'll find many suitable accounting software programs now available on the market to help you manage your club's finances. Professional advice should be sought before deciding which package to buy.
Download financial resources:
League Financial Requirements
While the requirements for each individual league will vary, all will have set in place certain expectations of their clubs with regard to financial recording and reporting and it is vital that the treasurer is fully aware of all these expectations.
Generally leagues will have policies and procedures for:
- The purchasing of merchandise
- Timing of payments
- Fine structures
- Penalties for breaches of league financial requirements
- Submission of annual accounts
Writing up Financial Procedures
All football clubs no matter how big need sound practices for regulating and recording financial transactions. There should be an audit trail for every financial event. Everyone’s job will be much easier with written policies and guidelines that everyone understands and follows. As you work through what processes are right for your club’s financial management system, record them in a financial procedures manual.
Your manual should describe all of your club’s financial administrative tasks and specify who is responsible for each one. It should include clear descriptions of how functions such as paying bills, depositing cash, and transferring money between funds are handled.
You should work through the processes by imagining you are doing the task for the first time and asking yourself questions like:
- How do we record transactions?
- How do we classify transactions?
- Who collects the information?
- Who records the information into our bookkeeping system?
- How do we check that the information is correct?
- What financial reports do we produce from this information?
Cash flow refers to the actual amount of "hard" cash available to the club to spend at any one time.
When predicting budget income and expenditure, periods of high/low income and high/low expenditure must be anticipated. This allows you to plan for accumulated cash to be available to meet high expenditure periods rather than when income is low.
This type of preparation is necessary because of the seasonal nature of many sports. The off-season may generally be a period for maintenance and replacing equipment, with limited possibilities for generating income. Cash must be accumulated beforehand.