Abstract
This paper critically analyses disclosure reporting and transparent valuation of the impairment test application (IAS 36) on intangible assets (IAS 38) in football clubs that prepare financial statements in accordance with IAS/IFRS and UEFA Financial Fair Play Regulations. Following a three-step procedure, the paper examines the financial statements of all the companies listed on the STOXX Europe Football Index for a five-year period (2012-2016). The research reveals some interesting and some controversial findings. Several football clubs exhibit a low level of disclosure and others a high one. Therefore, this study focuses on specific areas that primarily relate to economic and financial communication, as financial statements need to provide contextual disclosure. The study pioneers constructive criticism in relation to financial documentation and reporting produced by football companies. IAS/IFRS require further development in order to adapt typologies of specific sustainable business models for all the companies in the football industry.
Highlights
Football is not just a game; it is a significant international economic market that attracts a wide variety of investors (King, 2017)
In order to analyse the assessment and application of the impairment test (IAS 36) to intangible assets (IAS 38) of football companies that prepare financial statements in accordance with International Financial Reporting Standards (IAS / IFRS), the study focuses on clubs listed on the STOXX Europe Football Index
According to the “notes to the financial statements section”, the financial statements have not quantified the impact of variances between the Financial Reporting Standards, which are published by the Capital Market Board in Turkey, the accounting principles generally accepted in countries where the financial statements are to be distributed, and International Financial Reporting Standards (IFRS)
Summary
Football is not just a game; it is a significant international economic market that attracts a wide variety of investors (King, 2017). Corroborating the financial football dimensions and specific accounting regulations in the field, the current paper aims to highlight exploratory research on players’ registrations These registrations are included explicitly as an intangible asset in the professional football companies’ financial reports. Because players’ registrations comprise a substantial part of major football clubs’ total assets, this study intends to critically analyse the information of the impairment test It reveals what types of information clubs disclose on their financial reports, as well as how they choose to disclose it, in order to discover how the enrolment and valuation of players’ registrations can be treated appropriately (Gazzola and Amelio, 2015). We assume that the selected football clubs: A1) comply with the provision of IAS 36; A2) perform the impairment test; and A3) justify the reasons for their assets’ devaluation These criteria and points of analysis form the selected sample and research framework of our analysis regarding IAS/IFRS and FFP regulations
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