Updated: 2nd June 2021
The annual Football Distress Survey, conducted by business recovery specialist Begbies Traynor since
2012, has revealed a deceptively rosy picture of football club health, skewed by a number of Covidrelated
factors that cloak an undercurrent of rising debt and financial issues, pushed onto next season
None of the clubs in the English Football League showed signs of significant distress according to their
latest filed accounts, but worryingly the very early ‘Red Flags’ of financial problems rocketed by 94%, with
33 out of the 72 clubs in the three tiers below the Premier League displaying early signs of distress,
compared with 17 in the previous survey, in May 2020.
“What we can see is that the Covid‐relief packages from the Government, as well as the money that came
down from the Premier League, have gone some way to easing the pain of clubs in the EFL during 2020,
but we can also see from a detailed analysis of the Premier League accounts that have been filed so far
that other cash flow measures have been needed,” said football finance expert Gerald Krasner, a partner
at Begbies Traynor.
“Against the backdrop of the European Super League debacle, and an ever increasingly polarised picture
of health between the billionaire‐owned, super‐rich clubs and the majority of British football, we’re
seeing a whole raft of fundraising or actions to relieve cash flow, many of which will not necessarily
impact balance sheets and P&Ls for another 12 months.”
Krasner, who led the team of administrators that successfully sold Wigan Athletic Football Club out of
administration in March this year, has previously been on the board of Leeds United and is one of the
UK’s leading football restructuring experts.
He said: “Rights issues by shareholders have injected capital in some cases where owners have the means
to step in, and in other cases bank debt and deferred payments to creditors including players and senior
managers have helped.
“However, although these measures have been successful in securing the short‐term survival of clubs and
pushed the threat of administration further down the road, the cumulative effect is to build up a wall of
debt that will have to be serviced and ultimately paid off.
“As in the wider economy, the continued suspension of court cases is also creating the illusion of stability
among clubs that is likely to be shaken when the courts reopen. So while the help that football has
received from the Government and the Premier League have provided the lower division clubs with
much‐needed ‘extra time’, the escalating symptoms of early financial distress are a very real signal that
for many clubs the full financial effects of Covid are yet to be fully felt.”
Gerald qualified in 1971 as an ACA with Peat Marwick Mitchell and subsequently joined Bartfields Chartered Accountants where he began to specialise in Insolvency. He was one of the first licence holders in 1986 when he specialised in CVAs before they became more popular. Gerald has worked on numerous successful cases including Krasner v Dennison, for which he won in the Court Of Appeal and as a consequence changed the treatment of a bankrupts' pensions.
In 2004 he became chairman and part owner of Leeds United AFC which had debts of circa £103 million. These were reduced to £24 million before the club was sold the following year. In 2007 he sold the insolvency division of Bartfields to Begbies Traynor and became a partner at the firm.
Gerald has lectured both nationally and internationally to fellow insolvency practitioners and other professionals, and has also been involved in committees for both R3 and Insol.