by dedja » Sun Jan 04, 2015 1:25 pm
Had a quick look at the statements and on the face of it, they look fine to me.
It is a usual practice to separate football operations (football club) from gaming/licenced operations, hence the different entities.
The gaming/licenced entity (entities) are the profit makers, while pure football operations usually operate as a loss.
To balance the books, funds are usually transferred from gaming/licenced to football.
As long as each entity is operating within the law this is a perfectly acceptable and prudent way to run the overall club.
Another way to look at it is to consider the profit/loss and balance sheet of all the entities, you get the same financial result.
I would note the use Trusts presumably associated with the Redlegs Club. Nothing wrong with that except there is no financial accountability from these Trusts to members.
Another comment would be that they are not very detailed financial reports, with just a Profit & Loss statement, no Balance Sheet nor any explanatory comments. As it appears the club has not issued their annual report I'd expect the extra details would be contained within that.
Because of the lack of financial detail, it is not possible to understand the true position of the entities.
In Norwood's case, if I was a member I wouldn't be happy with the level of financial reporting and accountability (if not expanded in an annual report) and would be asking for details on the following:
Norwood Football Club Inc
income:
$208,500 trust distribution - It's assumed that it's coming from the North East Rd and The Parade Trusts, which should be gaming/licenced operations. The thing to note is that there wasn't a distribution in 2013.
$500,000 Distribution Licenced Club - this should be directly attributable to the $5000,000 Donation expense from the Redlegs Club
Redlegs Club Inc
Expenses:
$500,000 Donation - as above, transfer to the Football Club (consistent with 2013)
$308,570 Management Fee - not obvious where this is going, presumably to the Trusts (581 & 583 North East Rd, 137 The Parade) which are associated with the Redlegs Club
Trusts
Explanation of what they are, do and how they operate.
Financial Reports
Request more details, including a Balance Sheet and explanatory comments.
A little nonsense now and then is relished by the wisest men.
This post has not been approved by Dave from Alberton.