SFA Licence – Sevco Don’t Need Audited Accounts Because Rangers Did Not Produce Them Either?!

Alex Thomson has been able to get some feedback from the football authorities for his latest blog post.

Read the whole piece, which comments on what FIFA and UEFA have said, but I hope he excuses me repeating below the response he got from the SFA.

“Looming large, how can “Rangers” gain league/SFA membership when they cannot produce requisite three years of accounts?

The SFA answer:

” the…policy relates to applications for a new membership. In this case, Rangers Newco will be applying for the transfer of an existing membership held with the Oldco.

Rangers Oldco submitted the necessary financial information for 2009 and 2010. It did not submit for the year 2011, which resulted in the Judicial Panel sanctioning the club a total of £160,000 for various breaches of its Articles of Association, and also imposing a transfer embargo which has been subsequently set aside after the Court of Session ruling by Lord Glennie.”

That is – transferring old to new is not the same as a new club pitching up and wanting in.”

The licence requirements are contained in the SFA requirements on Club Licensing. Part 8 includes the Legal, Admin and Financial Criteria.

Clubs are required to produce:- a summary of financial information covering the reporting year for 2011 and the previous two years i.e. 2010 and 2009 as detailed below. The required information, taken from the annual audited accounts for the years referred to is as follows:-


Wages (Total Payroll Costs)

Wages to Turnover Ratio

Profit or Loss for Period

Net Assets at Period End

Net Debt at Period End


The SFA justification seems to be that there is no need for three years’ accounts because “Rangers FC” have been punished for not producing the accounts for 2011.

There are two relevant aspects of a licensing system. The system is designed to enforce standards. There are therefore certain regulatory requirements that must be fulfilled for the member to retain or obtain a membership.

Separately there are penalties for failure to fulfil the necessary licensing conditions.

The effectiveness of the licensing system is undermined if a participant can avoid meeting requirements simply by paying a penalty. This is why, for example, the penalty for failing to provide a specimen of breath is the same as for failing a breath test!

The failure to provide accounts is merely one part of the “Disrepute” charge. The fine imposed for bringing the game into disrepute totalled £160,000, being the maximum permissible. This covered the following, as detailed in the Statement of Reasons by SFA Tribunal :-

“The Disciplinary Charge 4 is bringing the game into disrepute. The charge then sets out the particular conduct which supports that charge. There were six elements set out.

It should be noted that the Judicial Panel Protocol Paragraph permits multiple disciplinary charges being brought in respect of a single act or omission.

The six elements alleged were

1 failing to procure the disclosure of his disqualification to the Scottish FA by Mr Craig Whyte.

2 failing to comply with the rules of the PLUS Stock Exchange rules by failing to disclose the disqualification of Mr Craig Whyte.

3 failing to lodge annual accounts by 31 December 2011 in terms of s447 of the Companies Act 2006.

4 failing to hold an annual general meeting by 1January 2012 in terms of s336 of the Companies Act 2012.

5 non-payment of PAYE income tax, National Insurance Contributions and Value Added Tax to HMRC.

6 failing to pay due sums to Dunfermline Athletic Football Club by 21 February 2012 in respect of a Scottish Premier League match played on 11 February 2012 pursuant to Rule C.14.5 of the Rules of the Scottish Premier League.”

As regards the penalty the Judicial Panel stated:-

“In respect that the maximum fines which could be imposed by the Tribunal were limited to £160,000, which appears but a small fraction of an ordinary month’s expenditure for Rangers FC, it appeared to the Tribunal that the circumstances of Rangers FC were not going to be significantly affected by any fine which the Tribunal could impose.”  

If Rangers Football Club PLC had not entered administration, and had all its assets and business sold off, would it have been granted a new SFA Licence, even though the 2011 accounts had not been produced?

Other conditions include having appropriate Public Liability, Employers Liability, Product Liability and Personal Accident Insurance. The SFA position would appear to suggest that, as long as the club pays a fine for not having these elements, they could get a licence without having them!

In any event, the accounts have been prepared. Reading the Duff and Phelps Proposal 5 April 2012 issued by the administrators we see the following:-

“The UEFA Club Licensing and Financial Fair Play Regulations 2010 require certain confirmations from licence applicants in relation to financial management matters. Amongst the key requirements are that the Club needs to:

Have completed, audited accounts signed off on a going concern basis. Given the uncertainty of the Club’s financial position the accounts to 30 June 2011 have not be signed off on a going concern basis.”

So there are accounts buried somewhere inside Ibrox, but they are not unqualified – which as the company shortly afterwards entered administration is not a surprise!

Has the fine been paid? Is the fine left in the wreckage of RFC PLC, or will Sevco Scotland Ltd pay it?

There was a leak of what was alleged to be the document sent to Sevco Scotland Ltd detailing what information and documents were needed to allow the transfer of the SFA membership to be effected.

This can be seen here RFC Sevco Membership Doc.

The most interesting requirements are as follows:-

Details of the Shareholding of Sevco Scotland Ltd, including all shareholders and financial backers;

The Business Plan of Sevco for the next five years;

Details of all Working Capital Arrangements;

Confirmation of there  being no involvement by Craig Whyte, and an irrevocable commitment that he have no involvement;

Confirmation of TUPE Arrangements;

Proposals to pay football debts to Rapid Vienna, Hears, Dundee United and others; and

Confirmation that Sevco Scotland will accept SFA sanctions re the Disrepute case, SPL sanctions re EBT’s and any other sanctions for matters not yet come to light.


On the basis that the SFA requested all of these details, and as it appears that they were produced by the 29th June deadline, one wonders why they have not also been given to the SFL members? Clyde FC have produced a statement tonight which complains, inter alia, about the lack of information provided to the SFL members in advance of Friday’s vote. Maybe this package of stuff would have helped the SFL clubs?


The frantic efforts of the SFA and SPL to keep “Rangers FC” in the second tier of Scottish football continue. It appears that this is all a plan of Messrs Doncaster and Regan, rather than one hatched with Sevco Rangers.

Clearly it is better financially for Mr Green if his team gets into SFL1. But he has kept quiet as he promised he would do.

The issues that face the SFA are numerous.

First of all, the application to transfer the membership will be determined by the SFA Board, which has complete discretion to approve or reject the application on whatever conditions it thinks fit. (SFA Article 14)

Second, the SFA needs to decide whether to approve Sevco Scotland Ltd for grant of a licence, where the conditions regarding the accounts have not been fulfilled.

Thirdly, the SFA Appellate Tribunal will presumably need to be reconvened to determine if the penalty to be accepted by Sevco Scotland Ltd will be expulsion, suspension or termination.

And this all needs to be done, or at worst the first two elements, in time for the season to start!


Posted by Paul McConville






Filed under Charles Green, Football, Football Governance, Rangers, SFA

15 responses to “SFA Licence – Sevco Don’t Need Audited Accounts Because Rangers Did Not Produce Them Either?!

  1. nowoldandgrumpy

    If the accounts were or are irrelevant, why were they granted an extension to provide them?

  2. David C MacKenzie

    As I asked elsewhere, here. Even if they did produce two years, prior to the year for which they seem to be being given an exemption, given the shenanigans that have gone on, can they really accept them as a realistic assessment of what was going on. For example, is there any overlap with EBTs. Elsewhere a footballing official is reported as saying that Rangers might even have been in no position to play last season, and so on. But also, does this all leave ‘the Club’ open to inspection by, for example BDO, and HMRC on two points. (1) they accept responsibility for certain debts, but not others, (2) they claim that they are a continuation of the old club, benefiting from something that if rules had properly been applied, they would not have been able to benefit from. For example, if AT had been allowed to reconvene, and had decided to suspend, or expel, as was possible, there would be no discussion, except for Sevco to apply at the very bottom.

    But, I am curious as to WHY they want to connect the whole £160,000 with the failure to provide audited accounts. Is that actually correct. Were they? It seems that they were penalized for bringing the game into disrepute by failing to provide audited accounts, as required under the Companies Act 2006, but NOT for failing to provide them under SFA rules. If it IS for a failure to provide them under the Companies Act 2006, then they are NOT competent to say that they are no longer required. I do not see it anywhere stated in the Companies Act that there is a special dispensation for the SFA, or any other Scottish Footballing authority to waive that requirement. They have already been found guilty of not having done it, surely to continue not to do it, is to compound the offense; the penalty was for bringing the game into disrepute by failing to submit accounts, not for failing to submit them.

    NOTE: If I am speaking rubbish, I will happily accept criticism.

  3. TerryONeill

    “Looming large, how can “Rangers” gain league/SFA membership when they cannot produce requisite three years of accounts?”

    It is important to differentiate membership from licence.

    While the sfa may consider a transfer of membership rather than an application you can not say the same about a licence.

    A licence can not be transferred between two legal entites ie rangers(ia) and sevco.

    A licence can therfore not be granted to sevco because mandatory criteria is three years accounts.

  4. JT

    It all really does leave you grasping for words sometimes.

    This is one of the worst cases I have come across of interpreting the technical wording rather than the spirit of rules. What if Sevco has an insolvent balance sheet? With no income and wages accruing this is not impossible. Surely the rules are there to ensure the ongoing club is financially stable and not about to fall Into insolvency.

  5. Auldheid

    I think that I, along with many others, thought one of the roles of the SFA was to protect sporting integrity against the threat of commercialism. You know the traditional checks and balances routine that protects government (from itself) .

    It is clear now that the SFA are as commercially minded as the SPL and rather than provide balance add further imbalance.

    The only balancing factor in terms of integrity as things stand falls to the likes of Clyde and Raith Rovers FC who find greatness thrust upon them.

    Once this debacle is over and hopefully with a victory for sporting intergrity that will secure the game’s long term future as a sport that earns money as opposed to a money earning mechanism for those in charge, then some form of exterrnal intervention is necessary to introduce balance and accountability as the turkeys at the SFA and SPL are unlikely to vote for Christmas even though the noise of knives sharpening can be heard.

  6. Auldheid


    July 10, 2012 at 8:24 pm

    The SFA go to great lengths to hide the difference. Club licensing could if used for that purpose provide the criteria for allowing SFA Membership but is not documented as having such power in the SFA Handbook and other rules.

    SFA Membership however has NO criteria but is promulgated by the SFA from time to time (from SFA Articles defintion) Anyone seen a list? Why not adopt club licensing criteria as SFA Membership criteria as well and say so? That would of course tie the SFA down and provide clarity..

    Then there comes the mobius strip trick to get SFA Membership in that SPL membership automatically confers Membership of the SFA, but the SPL use UEFA FFP criteria for granting SPL membership in their rules but it is the SFA who describe the process in detail in SFA rules and presumably actually carry it out (or is it the SPL? )

    who is actually responsible for granting a licence the SFA or SPL?
    who is responsible for granting SFA membership the SFA or SPL?

    It is in the dark recesses of the rules that Regan and Doncaster have operated, not invoking some when they should and using the opaqueness in who is responsible for what to deceive.

    Interestingly though is that for the SFL, Membership of the SFA is NOT granted automatically. If Sevco get in (anywhere) then the have 14 days to apply to the SFA for SFA membership and appear to only have an associate membership that becomes full after 5 years,

    So will the SFA grant Sevco SFA membership if they get a yes vote on Friday and will Sevco accept the SFA conditions to get it?

    It looks like the trade off is Sevco into Div 1 and they will accept SFA sanctions, if its Div3 they will not


    Greene might be threatening to shut up shop, which explains Regan and Doncasters desperate actions, they are being blackmailed by Greene!

    However assuming Greene is honest and will keep his word and will go to SFL3 and Sevco had no further sanctions, then whilst football debts and SFA fines would be unpaid, the remaining one that effects the support at large is the stripping of titles and that applies to Oldco not Sevco so as they are not affected they cannot complain.

    Quite how the SFA get around the Appeal final decison I have no idea but I cannot see them throwing Sevco out of SFL 3 if that is where they end up and I doubt anyone would bother.

  7. Surely…SURELY these two slimy characters (Regan & Doncaster) cannot be allowed to continue running Scottish Football. They have and Prostituted continue to prostitute themselves and our game for the sake of a few dollars more. They do not give a rats arse about Scottish Football if it doesn’t involve the Mason’s eleven – their beloved Sevco (dead cheating rangers). They duck and they dive they twist and they bend over backwards not to mention trashing the rule book all in the name of good traditional Scottish business corruption. Scotland at its best. Money is EVERYTHING . . .SPORTING INTEGRITY IS NOTHING. You, me, supporters, Club Chairmen . . .we mean NOTHING to Regan & Doncaster. They are mere mercenaries in place to ensure the ”right team” is well looked after. Well I say the game is up and we are on to them and we will not stop until they are booted back to where in hell they came from.

  8. Den

    Unbelievable !

    A long established Football Club gets itself into massive debt because of a catalogue of misdemeanours. A company registered on 2012 with no relationship to the previous company except that it bought the assets. The SFA say that two years accounts from the Football Company cover the obligation of the new Company to file accounts. A fine for not producing accounts covers year three.

    Again unbelievable.

    If they put up £500k could they just skip the requirement for accounts altogether?

    When I say that there is no previous relationship between SEVCO and Rangers I am looking at things from the strictly legal point of view. Some of the main players may be the same but we just don’t know.

  9. Auldheid


    Just a point of information. Had the SPL not voted no then Sevco would have been granted automatic Membership of the SFA with the SFA doing nowt,

    However if the SFL Vote yes, wherever Sevco are placed, then Sevco have 14 days to apply for SFA Membership.

    There is no published criteria for deciding SFA Membership but the SFA do have the problem of double contracts, outstanding debt to other clubs, fines owed to SFA and of course the delayed decisions of the Appeal panel to consider.

    Now the justification for granting Membership with all those factors is going to be interesting to watch. The only justification can be commercial considerations and if the SFA uphold that then sporting integrity is a gonner as there is no counter force to commercial considerations in our game. It is at their mercy..

    Now if the SFA were then to fall on their sword and allow something new and better and truly transparent and REALLY accountable to take their place I would be OK with humping a weakened huns the season after next for the foreseeable future knowing that the SFA support of the past was gone forever and the playing field was finally level.

    Given the role the SFA have played in the demise of our game falling on their sword is the least they can do, a public flogging with the proceeds going to Raith Rovers and Clyde would be nice.

  10. John


    Another interesting article – as usual.

    Being a little mischievous, I know, but the SFA tells us that the oldco submitted accounts in 2009 & 2010.

    So far, so good.

    In those accounts, was it the case that the then Rangers deficit trading position was supported by assets in excess of £100million? As those assets were recently realised in the market place with a value of somewhere between £1.5million and £5.5million are there not some serious question marks now hanging over those previously accepted accounts?

    • David C MacKenzie

      Not really. You have to remember that Director Imran Ahmad has said in public that: “On a bad day the club is worth £50m.” So, there is no problem … surely not … 😉

  11. The SFA declared Craig Whyte “not fit and proper”. No wonder he laughed at them. The same accusation could be aimed at the SFA.

    Also, don’t the SFA have a duty to ensure Sevco are “fit & proper” to ensure mistakes aren’t repeated? Shouldn’t they be demanding accounts to make sure they don’t go bust half way through the season?

    To be honest, the only consistent theme throughout all of this is “Protect Rangers at all costs and to hell with every rule in the book”.

  12. aberdeen

    Some excellent discussion here. It seems that there are deals and promises being exchanged regarding where this Newco play in future. There should be no such discussion. A new club applies to the SFL – Criteria met? – Accept or reject based on quality of application. Criteria not met – Reject application.

    I can’t see why this is so complex. Those charged with making the decision can then not be blamed for the consequences if it’s simply applying the rules impartially. The only ones to blame are those who drove the old club to ruin, dragging the rest of Scottish football with it.

  13. Pingback: Scottish Football Association: The Rangers Football Club Already Making Trouble | privatelimitedcompany.net

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