CHESTER FC has announced its losses for the 2012-13 season have increased to about £78,000.
Club chairman Tony Durkin announced last night at a monthly CFU meeting that the loss for last season had increased from an estimate of between £65,000 to £75,000 to £78,000 because of increased costs of this year’s audit, some missing tax payments and writing off bad debt.
Mr Durkin explained the increase in audit costs had come about because the club had become a ‘hotfile’ at the audit regulator after the club reported losses for the financial year and missing cash from the bar last January. The result of becoming a hotfile meant the club had to undergo a more rigorous audit which looks at every aspect of the club, including proof of income streams, safety certificates, staff training and hygiene. This has doubled the cost of the audit from about £6k previously to £12k. The club expects to pass all aspects of the audit.
Mr Durkin also announced the club had recently undergone a HMRC PAYE inspection which had uncovered a small handful of payments to staff which hadn’t been taxed which will result in a fine from HMRC. The fine is expected to be in the region of £1,000 to £2,000. The club is awaiting notification from HMRC.
Finally Mr Durkin blamed the increase in loss due to writing off £3,000 worth of invoices – money owed to the club but which has no paper trail and is therefore unrecoverable.
Despite the increase in the amount lost last season Mr Durkin said the club has got the finances under control. Speaking at the meeting he said: “Everything which was found by HMRC was historical, with issues going back to day one.
“HMRC said it has no doubts our books would be in good order next time and were very pleased with systems now in place.
“The result of becoming a ‘hotfile’ is the audit is taking longer than normal and the audit fee has doubled. That is completely outside our control.”
Speaking after the meeting, Mr Durkin added: “I am very positive about the future of the club. I am pleased with progress that has been made particularly in respect to the financial controls within the club.
“Because we now have accurate forecasting and monthly management accounts we are able to react quickly and positively to any changes in our financial situation.”