Players' registration rights in the financial statements of the leading Italian clubs: A survey of Inter, Juventus, Lazio, Milan and Roma

Abstract

Purpose

This study seeks to examine the influence of the gamut of changes that have taken place in the past 15 years in the world of international football that have permanently transformed football from a game into a real business, while also considering some specific events that have affected Italian football in terms of the valuation of players' registration rights in the financial statements of the leading Italian football clubs throughout the period 1996‐2009.

Design/methodology/approach

The research was conducted taking into account the leading Italian clubs. The clubs considered were those that, in the period examined, qualified at least five times for a place in the Italian Serie A championship which is instrumental to their direct participation, or through the qualifying round, in the Champions League.

Findings

The research shows that questionable window dressing policies, consisting of artificially overestimated values of players' registration rights, aggravated the Italian football crisis that exploded during the 2001/2002 season. However, the origins of this crisis must be ascribed to the inability of Italian teams to control players' wages.

Research limitations/implications

The study concerns only the leading clubs and examines the value of players' registration rights as an aggregate, as it is not always possible to extrapolate from financial statements the values attributed to individual players.

Originality/value

The Italian legal system, unlike others, establishes for corporations, the obligation to recapitalize if losses exceed a certain level. Based on this particular regulation, this research, suggesting a different interpretation of events, identifies the window dressing policies implemented by Italian football clubs during the period in question as behavior designed to evade the obligation to cover losses, and highlights the real purpose of the exceptional measures undertaken by the Italian legislator to save the entire industry.

Citation

Risaliti, G. and Verona, R. (2013), "Players' registration rights in the financial statements of the leading Italian clubs: A survey of Inter, Juventus, Lazio, Milan and Roma", Accounting, Auditing & Accountability Journal, Vol. 26 No. 1, pp. 16-47. https://doi.org/10.1108/09513571311285603