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How balancing the books is keeping FC Barcelona unbalanced

As the economical side is influencing all other areas of FC Barcelona, balancing the books is having a damaging effect on the club’s acting

Abhishek Khurana



Header Image by Joan Valls via Imago

In a desperate attempt to generate revenues to balance the books, FC Barcelona is becoming increasingly unstable in all areas of the club.

By their very nature, football clubs are heavily reliant on its human resources. In fact, there is a significant relationship between the capabilities of the personnel within a football club and its performance as a business.

As a result of this, transfers fees have, in recent times, reached record breaking levels – see, for example, the transfer of Brazilian superstar Neymar Júnior from Barcelona to Paris Saint-Germain for €222 million in 2017. This transfer was so large from a financial perspective that the wider sports community now refer to the inflationary pressures seen in the transfer market as the Neymar Effect.

Beyond the excessive inflation caused by extravagant transfer fees, transfers of this size have started to inflect some serious financial pressure on clubs that don’t have the financial capabilities of some of Europe’s more prominent clubs.

“Why couldn’t you beat a richer club? I’ve never seen a bag of money score a goal”

Johan Cruyff 

Today, there are numerous football clubs that are unable to compensate its players to the same degree as Europe’s elite clubs. Instead, they are required to compete through the development and promotion of players from within their own footballing academies. However, the players from these academies that are able to demonstrate that they have the talent to perform on the biggest stages of world football are often poached by clubs with large financial resources.

One needn’t look far for an example of this. Only last year, Ajax reached the semi-finals of the UEFA Champions League after an incredibly successful season in which the club’s players caught the eyes of football fans across the globe. Their reward for this was the loss of two of its best players, Frenkie de Jong and Matthijs de Ligt, in moves that saw the club receive €169 million. 

In Spain, FC Barcelona is another institution that has fallen victim to the inflationary transfer market, despite being part of the initial transaction that broke the glass ceiling of transfer fees. The management of the club in recent times has led to some potential trouble on the horizon for this European giant. To gain further insight into this, one needs to take a look at the club’s financial statements, which accurately reflect the wave of financial issues that could be heading in the club’s direction. 

A look at the FC Barcelona books

FC Barcelona’s annual report for 2018/19 reflects a budget of €124 million to be used for transfers and loan agreements. This was set with the expectation that the club would reach the quarter-finals of the 2019/2020 UEFA Champions League, given the potential prize monies to be won by reaching that stage of the tournament could supplement the overall transfer market activity take on by the club. The tables below provide an indication of the results of the Financial Year 2019 for FC Barcelona, alongside the club’s budget for its FY2020. 

Here we can see an expected increase of 6% increase in operating income, exceeding the figure of €1 billion forecast in the strategic plan for 2021, which created a lot of buzz in the football world.

FC Barcelona budget revenue books

Now, let’s look at the expenditure side the sporting payroll came out to be. The sporting payroll was reduced slightly, due to the sale of players and the fall in bonuses. In the impairment and others section, the depreciation for new capital investments and the impairment is due to the transfer of players grew – and was offset by the corresponding revenue.

FC Barcelona budget expenditure books

All this means that the estimated operating profit for the 2019/20 season stood at €40 million, which, including the financial profit / loss and taxes, represents an expected after-tax profit of €11 million.

FC Barcelona budget profit books

The curious case of Philippe Coutinho

In 2019, FC Bayern Munich, one of Germany’s most prominent football clubs, secured a loan agreement with FC Barcelona which saw Brazilian midfielder Philippe Coutinho transferred to the Bavarians for a one year period. Included in the loan agreement was an option to buy clause at the end of the loan agreement.

A financial breakdown of this transfer indicates that Bayern agreed to an initial loan fee of €8.5 million, paid to Barcelona, and would further cover Coutinho’s wages, which were set at €250,000 per week. The details around the option to buy clause, and the recent downturn in the transfer market as a result of the COVID–19 pandemic has made this transfer quite peculiar from a financial perspective. The initial option to buy clause permitted Bayern Munich to purchase Coutinho for a fee of €120 million at the end of the one year loan. The following scenarios detail how Bayern can treat this from a financial perspective:

Scenario 1: FC Bayern anticipates that it will exercise the purchase option 

If FC Bayern elect to apply IFRS 16 to this arrangement they do, the option to permanently transfer the player’s registration rights at the end of the contract is a purchase option. FC Bayern would assess whether it is reasonably certain to exercise the purchase option. Given the current scenario of market and economy it’s looking less reliable that they would go for it. But, if they do exercise the purchase option, it would include the €120 million transfer price in the lease liability ( under IFRS 16 App A ), and it would amortise the right-of-use asset over the useful life of the registration rights. 

Scenario 2

If FC Bayern is not reasonably certain to exercise the purchase option, it would exclude the €120 million transfer price from the lease liability, and it would amortise the right-of-use an asset over the lease term – or the useful life of the right-of-use asset, if shorter. Also, if FC Bayern elects not to apply IFRS 16, then FC Bayern, holding the option, has paid for this option as part of the loan fee. Therefore, part of the €8.5 million paid at the inception of the loan included the option payment as well. They would, thus, allocate part of the €8.5 million to the one-year registration rights and part to the option. 

The option of buying is, therefore, an intangible asset, since it is non-financial and does not meet the definition of a derivative under Appendix A to IFRS 9. The option asset would not be amortised, but it would need to be tested for impairment. There would be no amortisation of the option because the economic benefits are not consumed over time but only on exercise ( IAS 38 para 97 ).

But now, since the arrival of the pandemic that €120 million is nowhere feasible for FC Bayern. The below table shows the total income for Barcelona in context to meet their €124 million transfer budget.

FC Barcelona income from transfers books

Now, this leaves still €34 million short for Barcelona to achieve their €124 million of the budget of transfer and loan revenue.

This is just the one part of it, we also need to look at the expense side of the budget for 2019/20 season. Here:

FC Barcelona revenue profit expenses books

Looking at this, does selling Coutinho solve the problem for the club? He was signed back in 2018 for the contract of five years for the amount of €140 million. Now here comes the principle of player amortisation. This is the universal accounting principle only applied to the football world.

Now, we can see this would really cover up the amount of €34 million that the Barcelona board was getting short of. But given the current pandemic, there is a huge drop in the value of players in the transfer market and looking at Coutinho’s case, if the board wants to balance books they cant drop the price of 120 million more than 8%. 

Stripping yourself of assets to balance the books is the only way forward for the club if they don’t want to end like the mighty AC Milan in the near future. And, the latest victim to this strategy is Arthur Melo, who is being pushed out of his dream club just after two years.


See more

Barça board in ruins: Arthur Melo, the latest victim of the club’s financial chaos

How does the Arthur – Pjanić deal work from an economical point of view?

• Official: Arthur leaves, Pjanić arrives. What do Barça win and lose?

Tactical analysis: a look at Barcelona rivals Atlético de Madrid

Five days shalt thou labor, as the bible says. In my life, The seventh day is the Lord thy God’s. The sixth day is for Football. That pretty much describes my life when not working. I am here to share my ineffable love for this game among other football enthusiasts.



Can Alexander Isak be the firepower Barcelona need in their attacking arsenal

Jan-Michael Marshall



Photo via Imago

With incoming presidential elections and the resulting anticipation of a rebuild, more and more players are being linked to Barcelona. Besides big names like Erling Haaland and David Alaba, Real Sociedad centre-forward Alexander Isak is reportedly on the Catalans’ radar. A new striker is an absolute must for the club and Isak’s €70 million release clause is turning heads. His stock is rising and he has a bright future ahead of him, but should Barcelona pursue him?

Player Profile

Isak is currently in the midst of his second season for Basque-outfit Real Sociedad. The 21-year old started his career at the Swedish club AIK before moving to Borussia Dortmund’s youth setup in 2017. Lacking first-team opportunities, he was loaned to Dutch club Willem II, where he tallied an impressive 14 goals and 7 assists in 18 appearances. Isak then moved to Sociedad in the summer of 2019 and scored 16 goals in his debut season. This season, he has 12 goals in 29 appearances.

Isak is Sweden’s next star. (Photo by JONATHAN NACKSTRAND/AFP via Getty Images)

He has been dubbed the “next Zlatan Ibrahimovic” by some, and with the Swedish national team, Isak has scored five goals in 18 appearances.

Tactical and Statistical Analysis

Isak has all the attributes of a classic “target man”, one whose main role is to win aerial duels and play off of creative teammates, but his game is much more than that. He stands tall at 190 cm, or 6 foot 3 inches, but has incredible speed and balance. Despite his height, however, he is only winning 42% of his aerial duels this season.

Isak likes to play off the shoulder of the defence, eagerly waiting for through balls from creative midfielders like Mike Merino or David Silva. Alternatively, he can also hold the ball up. With his combination of speed and dribbling ability, he is a constant threat on the counter-attack, capable of getting past defenders or dragging bodies and creating space for runners. He also has decent vision and passing acumen for a centre forward, but Sociedad’s set up doesn’t allow him to maximize these qualities.

Isak has the speed and strength to bully players anywhere on the pitch. (Photo via Imago)

Statistically, he is averaging 1.36 dribbles per 90 minutes this season at a clip of 64.8%. According to, when compared to forwards in Europe’s top five leagues (Spain, England, France, Germany, and Italy), Isak stands out in terms of his successful pressures rate (93rd percentile), pressures in the attacking third (81st percentile), and carries into the penalty area (87th percentile).

In front of the goal, Isak is dangerous with both his feet and his head. He is unpredictable with his finishing, always keeping defenders and goalkeepers on edge. This campaign, his 12 goals are fairly evenly distributed: six with his right foot, three with his left, and three with his head. Most of his goals have come from through balls or passes over the defence. He carries the ball in his stride and finishes with confidence.

Isak’s goal scoring locations for the 20/21 season, retrieved from

His goalscoring record was rough to start the season, scoring only four goals across 20 appearances, but he’s picked things up in 2021. The forward has been in rich vein of form, already scoring nine goals this calendar year. Furthermore, in La Liga, he has scored in each of his last six appearances, not to mention a hat trick last time out against Alavés. He could have a breakout season if he continues scoring at this rate, attracting offers from teams across Europe.

Where would he fit at Barça?

Naturally, Isak fits a need for the Blaugrana at centre forward. The team has no natural “number nine” –other than Martin Braithwaite — and with Messi entering his twilight years and potentially leaving in the summer, they desperately need goal-scorers. The Swedish international is well adapted to playing as a lone striker in a 4-3-3 system and is already accustomed to playing in La Liga, so Barça won’t need to worry about adaptation along those lines.

Tactically, his height and runs into the box could bring a different dimension to a fairly one-dimensional Barça attack. While he could fit in well with the team’s patient and possession-oriented approach, his game is more suited for runs into open spaces and spearheading counter attacks.

Isak is built for the modern game with immaculate pace and power. (Photo by Juan Manuel Serrano Arce/Getty Images)

The question is, would he start for Barcelona? Messi is best suited for a false nine role, and Isak would not displace Antoine Griezmann, Ousmane Dembélé, or Ansu Fati in the front line. On the contrary, he could be an extremely productive squad option, but his potential transfer fee would be too high to warrant such a role.

Should Barcelona pursue him?

There are plenty of intriguing reasons for Barça to pursue Isak, but he should not be their number one transfer target. He undoubtedly has a bright future ahead of him and is showing immense quality this season, but he might not be ready to carry Barcelona’s front line.

There will be a lot asked of him, and he will be expected to perform on the biggest stages in world football, and his zero goals in the Europa League this season are not reassuring. Despite his incredible form over the last few games, Barça need to see more consistent output if he is to be their number nine for the next decade.

Isak is incredible, but he has a long way to go. (Photo via Getty)

He would also cost the club around 70 million euros, and that money could serve the team better by investing that in other areas like centre back or centre defensive mid.

While he is still young and has time to improve, Barcelona should focus on more refined and finished products.

Closing Thoughts

On the one hand, Isak could bring a lot to the Blaugrana and offer much-needed variation to their attack. On the other hand, there are signs pointing to the fact that he is not yet the calibre of player Barcelona need to lead their frontline, especially for that sum of €70 million. He could be a more than sufficient squad option and someone who could develop in the long term, but once again, that transfer fee warrants caution.

Also, facilitating his move could be quite difficult given that his ex-team Borussia Dortmund have a reported €30 million “buy-back” clause attached to his name. If (and when) the German club are to lose Erling Haaland, they could easily opt for Isak as his replacement.

Maybe in a few years. (Photo via Imago)

Isak is a solid striker and has a lot of potential, but he is not yet the player capable of leading Barcelona’s front line. That paired with his potential transfer fee means the club should focus on other transfer targets first.

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