Source: Times of Malta
The Times of Malta has today published the below article highlighting the financial situation of the MFA following the Association’s General Assembly which was held last Friday.
Football’s governing body in Malta is facing “significant doubts” over its ability to meet its financial obligations, as its accumulated deficit hits €5.6 million.
The Malta Football Association’s financial report for 2023 shows the precarious state of its finances, with its auditor drawing attention to doubts about its capability to continue functioning as a going concern.
The MFA disclosed in its financial statements that negotiations are underway with its banker to reschedule certain loan repayments because of financial difficulties.
The financial statements say the MFA is “confident” that the bank borrowing repayments will be rescheduled, and that it will be able to achieve the level of income and expenditure needed to continue in operational existence “for the foreseeable future”.
Football’s world governing body FIFA has already granted the association a one-year moratorium on the repayment of a COVID relief loan, taken out in 2022, according to the financial statements.
The MFA’s financial losses continued last year, with the association registering a deficit of €786,000, taking its accumulated deficit over the years to €5.6 million.
A spokesperson for the MFA argued that last year’s loss is a significant reduction from the €3 million loss registered the previous year.
The spokesperson told Times of Malta that the €786,000 loss includes depreciation and finance costs on loans which the association has been carrying for a number of years, in relation to capital invested in club infrastructure, as well as loans taken out during the pandemic.
At an operational level, the spokesperson said last year’s revenue exceeded spending by €441,000, which shows that efforts towards returning to a positive balance are starting to show.
“A spokesperson for the MFA argued that last year’s loss is a significant reduction from the €3 million loss registered the previous year”
On the material uncertainty about the association’s finances highlighted by its auditor, the MFA’s spokesperson said the association relies mostly on UEFA and FIFA funding programmes.
“While these programmes have increased significantly cycle after cycle, their likely future increase cannot be taken as a certainty for the purposes of financial reporting.
“Despite this, the association remains committed to prioritising cost-consciousness with a view to achieving better sustainability while seeking not to prejudice the objectives set out in its strategy,” the spokesperson said.
The association’s financial statements describe the support received from UEFA and FIFA as “critical”.
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The statements say the association has already obtained backing from UEFA, which reiterated its support to its member associations in guaranteeing financial stability in case of financial difficulties “due to unforeseen circumstances”.
Income will continue to grow, the statements say, particularly in the area of sponsorship and operations of its facilities.
“This will be coupled with a sustained control of spending on international travel and salaries, both of which remained contained over the past year, and this trend is reflected in the budgeted expenses for 2024,” the association’s financial statements say.
Spending on travel and accommodation reached €2 million in 2023, up from €1.7 million the previous year.
