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Impression Management in Football Club Financial Reporting

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  • Stephen Morrow

    () (University of Stirling, Scotland)

Abstract

The paper investigates the selection of accounting policies for intangible assets in the Italian football industry, focusing on the effects of the so-called salva calcio decree. Introduced by the Italian government, the decree effectively permitted clubs to amortize the asset of players’ registration rights over an arbitrary time period of 10 years rather than over the length of players’ contracts, thus improving clubs’ reported financial position and performance. While adoption of the salva calcio decree had no direct cash flow effect, it had indirect economic consequences. It is argued that adoption of this policy by some Italian clubs was motivated by a form of legitimacy theory, whereby clubs sought to legitimize their financial position and performance with a view to meeting the licensing demands of football governing bodies. It also highlights the difficulty stakeholders face when trying to understand a football club’s financial results. Far from being neutral, figures in financial statements are value-laden.

Suggested Citation

  • Stephen Morrow, 2006. "Impression Management in Football Club Financial Reporting," International Journal of Sport Finance, Fitness Information Technology, vol. 1(2), pages 96-108, May.
  • Handle: RePEc:jsf:intjsf:v:1:y:2006:i:2:p:96-108
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    Cited by:

    1. repec:eee:advacc:v:30:y:2014:i:2:p:381-393 is not listed on IDEAS
    2. Stephen Morrow, 2014. "Football finances," Chapters,in: Handbook on the Economics of Professional Football, chapter 6, pages 80-99 Edward Elgar Publishing.
    3. Andrews, Matt & Harrington, Peter, 2016. "Off Pitch: Football's Financial Integrity Weaknesses, and How to Strengthen Them," Working Paper Series 16-009, Harvard University, John F. Kennedy School of Government.
    4. Carmine Zoccali, 2012. "The Role Of Financial Indicators In The Life Of Italian Football Clubs," Rivista di Diritto ed Economia dello Sport, Centro di diritto e business dello Sport, vol. 7(3), pages 83-101, gennaio.

    More about this item

    Keywords

    financial reporting; football; salva calcio;

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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