The Price of Football, by Kieran Maguire

You think you know all about football? You don’t until you understand the difference between a balance sheet and a profit or loss account, tangible versus intangible assets, financing and operating liabilities and the meaning of amortisation. It takes an accountant’s training to decipher footballing finances because there is no standard way in which football clubs file their accounts. Manchester United submitted a 1,434-page return in 2019, while Mansfield Town’s ran to just three pages. In addition, some clubs seem to make their accounts impenetrable to all but the expert in order to bury bad news (step forward Derby County).

The antithesis to the cliché that football is the beautiful game is the equally clichéd statement that football is big business. Kieran Maguire explains the reality behind the latter claim, detailing the vast inequalities of wealth, mainly focused on the English elite levels. He also highlights the uncertainties and difficulties in measuring these inequalities, since there are numerous different ways to calculate a club’s earnings or measure its total value. Hence readers will find an account of the Markham Multivariate Model, for the latter, and be in a position to use it. Yet Maguire doesn’t shy away from the politics behind such valuations, cataloguing Mike Ashley’s attempts to sell Newcastle United and his interest in its worth being valued highly.

Football doesn’t come out of this looking particularly ethical or trustworthy. It is clear that there is plenty of sharp practice permitted within the rules, for those rules are extremely vague and lax. Many clubs struggle with their finances, especially in the Championship, where everything is gambled on the prospect of winning promotion and attaining Premier League riches. Liabilities get shifted around a multitude of Russian-doll shell companies or moved into different financial years; assets can be overvalued and sometimes created out of thin air. Usually, this is to avoid the possible penalties of the Union of European Football Associations’ Financial Fair Play Regulations, which many see as a sensible development. Maguire does a fine job of deconstructing those rules, though, and shows how they more likely serve the interests of the big six clubs by protecting their position at the top of the Premier League from nouveau riche challengers.

This study prompts two thoughts. First, it really is naive to think of professional football as merely a sporting contest. Money counts a lot. A Premier League or Championship club needs a strategy that works within its financial limitations. Sometimes there will be moments in which a cash injection is chanced, but the price of servicing the debt can be high if such a gamble fails. Second, however, this shows why football fans warm so much to those clubs that on rare occasions find success without vast wealth, such as Leicester City’s Premier League win or Sheffield United’s performance this season.

Maguire makes quite an admission that “company accounts are dull”, since after reading the first three chapters I feel ready for my accountancy exams. Nevertheless, his book should be essential reading for anyone even remotely considering investing in football (and, unless they are super-rich, they should probably stay away). For general readers, it won’t exactly enhance your enjoyment of football, but it should at least increase your understanding of what goes on and why.

Stephen Mumford is professor of philosophy at Durham University.

The Price of Football
By Kieran Maguire
Agenda, 216pp, £22.99
ISBN 9781911116905
Published 16 January 2020