It is that time of year when my two worlds collide. When the “day job” and whatever you define my cricket writing as intersect – the review of the accounts for Somerset County Cricket Club.
Now I fully understand if that initial paragraph puts you off but please bear with me. I promise I will keep it brief. Somerset supporters should also remember that there is a reason why these accounts are so important. Back in late August all kinds of rumours swirled about the Club’s financial position following the abrupt departure of Andrew Cornish.
The burning question is, were those rumours well-founded or not? As with everything in the world of accountancy there is never a definite yes or no. What follows is my take of the accounts both from a Chartered Accountants and Somerset supporter’s point of view. And I’ll give you my take on the events of the late summer at the end.
When I am working with my clients I always seek to establish what are the key financial indicators that we can use to measure how the business is performing. It is clear from the Honourary Treasurer’s report that Somerset County Cricket Club.
Profitability is, of course, a key number and in this regard the Club has reported another strong result of just over £300,000. The profit is virtually unchanged from 2018. It appears from digging a little deeper that this result was lower than planned. The Treasurer makes particular reference in his report to these targets not being met and identifies “the opportunities in respect of the ICC Cricket World Cup hosting” not being “taken as fully as expected in financial terms”.
The report also refers to the SCCC shop in terms of having learned lessons from its first year of operation. The loss attributed to the shop for the year was £21,689.
There are a significant number of positives to be drawn from these accounts. Turnover rose just under 20% of which over half was attributed to the World Cup with the Club’s “profit share” from the event still unknown. This amount will be accounted for in 2020.
Expenditure described as “non-cricket” rose by just over £350,000 from 2018. The Club believes that a large part of this expenditure will not recur in 2020 which will enhance future profitability.
The balance sheet is strong, a testament to the work begun by Andy Nash and the underlying principles the Club adheres to of financial responsibility. The accounts report a £1.65m investment in infrastructure, principally the floodlights but also the development of the ground. While the net debt increased in the year the Treasurer’s report indicates that the intention is to repay and perhaps partially reschedule this funding in 2020.
These accounts confirm the impression of the last few weeks that the Club remains in a strong financial position. The signings of Matthew Wade and Vernon Philander and the return of Babar Azam all indicated that the Club is confident in its finances.
Somerset County Cricket Club remains in a strong position financially. The accounts tell me that there is a sense of disappointment that Somerset did not fully exploit the financial benefits of the 2019 World Cup. Additionally, there are several references in the accounts to expenditure not being as well controlled as might have been hoped.
The Club has addressed these issues, both by the action taken in the late summer with regard to the position of Chief Executive but also in the “detailed strategy review amongst the senior management team with a detailed “bottom-up” budgeting process.”Somerset supporters can rest easy. Their club remains one of the best run and financially secure of the eighteen first-class counties. It is to their great credit that they have identified under-performance and taken swift action to rectify them.