I received this from Rugger Guy this afternoon and I think it is worth sharing.
Good afternoon Phil
In our most recent chat, you brought up the recent financial challenges which continue to haunt RIFC.
You also mentioned the loan taken out in February this year by Close Brothers for £3m and I reminded you that it was worth pursuing this for a more full financial disclosure as the recently published accounts made no reference to these at all.
This seemed strange as it appears that this liability and related finance costs were still outstanding as at 30 June 2018, the financial year-end.
I think that it is worthwhile to do a brief refresh on this:
In the agreement of February 2018 between Close Brothers and RIFC, there was a charge placed on the west side of Broomloan road and Edmonton House. In addition there was a subsequent floating charge raised on the stadium catering equipment, the stadium PA system, stadium wifi system and stadium bowl screens, with collective value on these four assets of £3.2m.
In October 2018, over three months after the year-end, you indicated that Close Brothers called in the loan.
In my analysis of the accounts to 30 June 2018, the only charge or security disclosed was the standard security raised over the Hummel training centre by the Scottish sports council. The accounts were signed off at the end of October, so potentially they may have been repaid shortly before the publication of the accounts.
In essence, the accounts have not shown any other loans apart from directors, investors and related parties.
The charges on assets acquired under a finance lease are listed separately.
Interest charges shown in the accounts are minimal as all the loans were essentially granted on an interest free basis. I am quite certain that the Close Brothers’ loan would have been made on a commercial basis.
Ordinarily, if this loan was not paid off in full before 30 June 2018, I would have expected Campbell Dallas to ensure that the full and correct disclosure would have been made.
The lack of disclosed information on this loan is perplexing indeed.
Well, if he finds it “perplexing” then that’s good enough for me.
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£61m in losses over 6 Seasons of existence with a Petrofac Cup and failed Europa League run in one of the poorest Groups in the competition to show for it?
Couple that with a team currently made up of loan players.
You don’t have to be a Financial genius (thank Christ) or even play with odd shaped balls to know that this is not a financially sound approach to Football or business.
The thing about huge mistakes is that you generally tend to learn a hard lesson in making them?
In the case of the Tribute Act it would appear that the Megalomaniac tendencies are there for all to see and nothing has been learned from the previous disaster.
⌛️……💣
So Jim McColl reckons Rangers have nothing to worry about despite being £22m in debt to directors and board members.
They have no access to a bank overdraft and once again the auditors have signed off on the accounts with a strong going concern warning.
A £14m loss for the last financial year has recently been forecast and further losses are forecast for the next two years.
Since the new clubs formation in 2012 total cumulative operating losses are heading for €50m but still no problem according to Mc Coll.
Add in the merchandising shambles and King’s battle with COS/TOP and you wonder what world Mr McColl is inhabiting.
The article smacks of someone giving a positive take on the situation which bears no relation to the actual scenario unfolding.
If either Tavernier or Morelos, or both, go in the January window then Mr McColl’s take on the Ibrox finances will look a wee bit silly.
Perhaps if things are really looking up then McColl might be throwing his financial weight behind Kingco?
Is Stevie G going down the road of numerous other great players who didn’t make the transition to manager?
It was only a few weeks ago that he was making noises about giving permanent deals to Ejaria, Kent, Worral and Coulibaly.
Sadiq apparently is already on his way back to Rome.
All 4 of the above have been getting pelters from the fans who have made it quite clear that none of them are good enough.
That will be a relief for King who won’t have to cough up their transfer fees but at the same time reflects the lack of quality that Gerrard was crying out for after the game last night.
Though it has to be said that going out to Rapid, who have won 5 of their 17 league games this season, and find themselves 25 points behind an unbeaten Salzburg, is unacceptable, so poor are RV.
A Celtic win at Hibs, evening up the number of games played with Rangers who kick off later on Sunday, will open up a 5 point gap.
Is Gerrard’s squad up to handling the increasing pressure?
No doubt the media, and the Rangers fan base, will see the positives in being eliminated from Europe, allowing their team to concentrate on the SPFL, whilst Celtic have a European distraction, even though it might just be two more games.
Just listening to BBC Scotland news this morning whose sport headline has Celtic ‘scraping ‘ through to the round of 32 whilst Rangers bowed out, boo, hiss.
Celtic won 3 of their 6 games, 2 of the defeats against a very good Salzburg outfit, the other from a team flying high in the German Bundesliga.
I will take ‘scraping’ through another couple of rounds, thank you BBC.
The January window is about to open. I suspect that if anyone adds quality to their squad it will be Celtic whilst Gerrard brings in another couple of loanees whilst perhaps losing Tavernier and Morelos.
We have five games left in December, all in the space of thirteen days. Three of them away to Hibs, Aberdeen and Sevco. The home games are Motherwell and Dundee. Sevco have Hibs, home and away. Accies and us at home plus St Johnston away. On the face of it we have a more difficult fortnight but I think we are better placed to cope with a period of that intensity. Maximum points from those games will see us home and hosed in the league. If we get maximum points from the first four, sevco lose ANY of the games before the 29th, AND then lose to us SG really will struggle to keep his job. That would see us AT LEAST eight points clear with a game in hand. I have one major concern. Why oh why did Celtic take those tickets. I really fear for the safety of any fan crazy enough to buy one. In fact I have grave concerns for the safety of our players in that fixture. When it comes to Sevco fans, violence is their default setting and when they outnumber the people they decide to act violently against their “bravery” knows NO boundaries. I desperately want to comment in two weeks time that I was 100% wrong here.
I share your thoughts on the tickets and the safety of the Celtic players.
A couple of goals ahead on the 29th, any hope of 55 disappearing again, I have a picture of the 1965 pitch invasion by Rangers fans as Celtic did the customary lap of honour with the players having to run for their lives.
The SFA slapped a 10 year ban on laps of honour as a result, for all teams, not just the one whose fans were responsible.
There is talk of netting being put up to prevent Celtic fans being bombarded from all sides and above. That in itself is an admission that the fans are in danger.
Police Scotland will have their work cut out to protect the safety of Celtic fans in and out of the stadium.
In the event of some eejits getting onto the park I’m presuming the match commander has a plan in place to protect the Celtic players if such an event comes to pass.
This isn’t just 8 IAR. It’s the end of Kingco and the Stevie G project.
Stevie’s cry for additional quality to help him and the squad will at best see some more loanees pitch up at Ibrox along with a 34 year old Steve Davis, another of the class of 2012 returning to the fold.
It won’t be enough.
Aye, well! There’s ma maximum points theory right oot the windae!!!
Also some are taking pelters from fans who don’t think they’re white enough! HH
I see Gerrard is calling for investment to add quality to his squad.
I’m sure he will be on the blower to King in the morning to find out what he has to spend.
However there is no excuse for failing against the worst Rapid team in recent memory. They were incapable of putting two passes together and Rangers were just as bad.
Both goalies were hardly tested as the players in front of them continually gave the ball away.
It’s little wonder that they are 25 points behind Salzburg in the Austrian league at the mid point of the season.
I wonder when Stevie G catches up with King that he will find out that funds for incoming players will have to be generated by selling Morelos and Tavernier?
Had to have a little chuckle earlier today when I read that Herrera and Pena are costing them a combined total of around £50G a week. Nae wonder DCK’s sqinty!!
Perhaps it was a genuine overdraft or flexible loan type arrangement that was never drawn upon?
Looks as if Rapid Vienna are doing all they can to make Rangers fans welcome.
Creating additional space near the away support for those who have bought tickets amongst the home support.
Advising fans without tickets not to travel to the stadium but instead watch the match on TV in the city centre.
Let’s hope the love emanating from Rapid is returned in spades by the travelling support no matter what the result.
The only plausible explanations would be (1) that the loan was paid off in full and the floating charge was removed. I’ve not checked Companies House so cannot confirm if this is the case, or, (2) they may have paid off the loan prior to year-end and thereafter re-instated a new loan (although if that was the case, one would expect to see a new floating charge issued).
It seems inconceivable that Campbell Dallas would miss something like this. For a mid-tier firm like Campbell Dallas, these accounts are likely to be more heavily scrutinized than others given the client’s high profile nature and the extreme sensitivity around going concern. Management and the signing partner would have a duty to spend a good deal of time looking at the disclosures. It is major (dare I say material) error if they have missed something like this.
Going by the logic of Occam’s Razor, I am going to suggest they’ve paid this off. How they have done so given their financial constraints begs an entirely different set of questions…
Agree. The loan must have been paid off before year end and so had to have used the season book money for some/all of it. It’s the only way it didn’t have to be disclosed since it was opened and closed out within the period of the fiscal year ended June 30 2018. It’s only a guess, but this was made up for by the post year end activity of additional Investor loans of 2M and also the 1.5M they netted from the share issue. Anything else they had to do is just buried in probably a couple of other account items and so don’t stick out.
It was very strange indeed that the accounts made no mention at all of the Close Bros loan.
Given the hoo ha at the time you would expect some clarity on the situation.
Those guys over at Ibrox Noise are a hoot. A couple of hours ago they were creaming themselves at reports of Steve Davis( traitor No 3) on his way back to Ibrox.
Just the sort of midfielder that they required was the general opinion.
A few hours later, following a statement from Davis that he wanted to stay on with the Saints, his stock has plummeted and his age, 34, is perceived as a negative.
It’s not unlike the way McInnes was dissed after turning down the Ibrox gig.
There are no good news stories emanating from Ibrox.
The manager and his backroom staff are being questioned, as are the abilities of many of the new faces brought in during the summer.
Another couple of setbacks on the park and the league challenge will disappear, leaving the Scottish Cup as the only silverware available.
The Takeover Panel row rumbles on and no one wants to mention the merchandising contract.
Just a few weeks till the transfer window opens. It would appear that no significant purchases will be made though further loanees may be added to the 5 already in the squad.
If Tavernier and Morelos head out the door in the window it will be a telling reflection of the financial situation and Stevie G will have every right to review his position after losing one or both of his best players.
With Gary McAllister already on the premises a quick hand over can take place for, no doubt, the former Liverpool player might be attracted to the job.
On the other hand he might step back and review his position. Who wants to go down in history as the man in charge at Ibrox when Celtic do the treble and 10 IAR beckons.
Exciting few weeks coming up starting with Salzburg on Thursday night.
Would take the point now that we need to qualify, they are a decent outfit.
Puzzling indeed. You would think that, had this loan been paid off, they would be shouting from the roof tops about it. Unless they are still trying to peddle the myth that it was an overdraft facility.
Remembering raising this myself at the time, that the accounts made no sense with regard to this. Been racking my brain trying to come up with a plausible explanation but can’t. Of course, I am sure there is a perfectly good and valid explanation for it. Perhaps someone should send a note asking Campbell Dallas for comment?
Wonder why these accounts were never loaded to their website?
I wonder too if rugger guy should look into the details of the debt for equity transactions and check that a fair price was paid? Indeed what was that price? How does it compare with the offer to buy that King must make or with the price that C1872 have been paying?
I’m sure it was on their website I read them.