Good financial management is imperative. Your Board expects and demands it. You can be successful on the pitch but if your finances are in a perilous state you’ll be heading down a troublesome road that many teams struggle to come back from. Furthermore, with ‘fair play’ rules and restrictions coming into effect in more and more competitions, it is imperative to have a firm grasp on the club’s fiscal responsibilities.
Basic Finances
These options largely deal with the day-to-day financial status of your club. The Summary screen gives you a quick and informative overview of how the club is doing, with particular attention on any rules and regulations you are obliged to adhere to. The Income and Expenditure screens display a detailed breakdown of the money coming in and going out on a monthly and seasonal basis.
The Debt and Loans tab contains information on all outstanding payments the club is required to make; the Sponsors and Other tab shows where and what is coming in from sponsorship streams. You can also adjust the budget from the Summary screen by selecting the ‘Make Budget Adjustment’ button. This is contingent on the Board being happy for you to do so as well as there being sufficient funds to manipulate to your requirements.
It is very much worth taking some time throughout the season to check this section thoroughly to make sure you’re fiscally responsible. Some football league authorities punish teams who enter administration with a points deduction, and if things get really bad, creditors may take control of your team and accept any bids made on your players to alleviate the financial problems you are in.
Successfully managing your finances
You also have the option of managing your wage and transfer budgets so that you may, for example, move some funds from one area to another to maximize the benefits you are able to make from your balance. To do this, navigate to the Club Vision screen and the ‘Budget Adjustment’ panel. Your Board indicate their thoughts on the matter, as well as any changes they are willing to allow you to make. Depending on the financial situation at the club, these changes may be restricted somewhat.
Otherwise, sensible financial management relies on you taking an active role in checking your Finances screen often, and making sure you know where money is being spent. One common area some managers struggle with is how much money leaves the club in transfer deals; just because the fee is being spread over a certain number of months doesn’t mean that the money doesn’t have to be budgeted for immediately, and then there’s the loyalty bonus or the agent fee to factor in too. A few quick transfer deals in a short space of time – or a host of contract renewals all done together – can have a major impact on your finances.
If you’re on a tight budget and struggling to keep things balanced, pay attention to player wages, money being spent on scouting, and additional payments either due to players (bonuses, clauses) or other clubs (additional transfer payments). You can often negotiate a fee with the other club to buy out that clause and stop that money from going out, and you can attempt to renegotiate more favourable terms with your own players or, if needs be, sell them.