DCSIMG

Financial review outlines spending mistakes at Ibrox

Rangers chief executive Graham Wallace

Rangers chief executive Graham Wallace

Financial mismanagement, seriously flawed financial assumptions and ill-defined short-term decisions that were ill- thought-out and poorly executed.

This is the damning indictment of the Charles Green and Craig Mather regimes that have run Rangers Football Club in the past two years contained in the long-awaited Business Review prepared by Chief Executive Graham Wallace.

One could certainly not accuse anyone of pulling their punches in the report: “The Board considers that the perfect opportunity to rebuild Rangers immediately post- administration in a progressive, stable manner with a solid financial base has been completely missed through a series of ill-defined, short term focused decisions with little advance recognition of medium or longer term requirements.

“The Club raised £70.7 million through ticket sales, commercial revenues and share sales proceeds between May 2012 and December 2013 and proceeded to spend most of this relatively quickly with only £3.5 million of this cash remaining at 31 December 2013.”

Four months on from the AGM when the Review was promised within 120 days, the analysis lays bare the gross mismanagement of previous Boards of Directors and Chief Executives – but assures the Light Blue legions that Ally McCoist’s playing squad should not be materially affected by the measures outlined within the report.

Indeed there is a commitment to strengthening the squad this summer with a view to securing next season’s Championship and in the medium–to-long term a three-year plan to ensure the return to the peak of the Scottish domestic game and a return to competitive European football.

A newly-appointed ‘Chief Football Operations Officer’ is proposed to address the current lack of a scouting network at the club – and there is a commitment to Youth Development.

Nevertheless there is criticism of many of the contracts offered to players since the summer of 2012 at terms that the club simply can not afford.

The report also states that operational and organisational changes have been identified and business practices have already been tightened with savings in operating costs of £2 million having already been achieved with more identified and in progress.

The necessity for further equity investment in the region of £20 - 30 million is starkly outlined in Wallace’s review – investment which will be sought, subject to shareholder approval, later this year. Exactly where such investment will come from is not detailed. Former Director Dave King stands in the wings prepared to invest – but whether the current Directors have other alternatives remains to be seen.

Dependent on all of this of course is the uptake of season tickets, which at the present time is not happening in any great numbers due to a boycott suggested by King and backed by many – but not all –fans.

The report outlines clearly the consequences if the boycott continues – that the club would need to secure external funding at a probable prohibitive cost.

The Business Review may persuade some to renew their season tickets – but many will view with suspicion the implication that it is all the fault of previous Boards of

Directors.

Nevertheless there is a great deal of truth – if a brutal truth – in the report which describes the financial situation as ‘precarious’.

 

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