Gillingham Football Club Limited - Limited company accounts 18.2

REGISTERED NUMBER: 00039175 (England and Wales)

GILLINGHAM FOOTBALL CLUB LIMITED

REPORT OF THE DIRECTORS AND

AUDITED FINANCIAL STATEMENTS

FOR THE YEAR ENDED 31 MAY 2018

Page

Company Information

1

Report of the Directors

2

Report of the Independent Auditors

4

Income Statement

7

Statement of Financial Position

8

Notes to the Financial Statements

9

DIRECTORS:

P D P Scally

M Quarrington

M Anderson

SECRETARY:

M Quarrington

REGISTERED OFFICE:

Priestfield Stadium

Redfern Avenue

Gillingham

Kent

ME7 4DD

REGISTERED NUMBER:

00039175 (England and Wales)

AUDITORS:

Hilden Park Accountants Limited

Chartered Accountants

& Statutory Auditors

Hilden Park House

79 Tonbridge Road

Hildenborough

Tonbridge

Kent

TN11 9BH

BANKERS:

Barclays Bank Plc

Hatton Garden

99 Hatton Garden

London

EC1N 8DN

The directors present their report with the financial statements of the company for the year ended 31 May 2018.

DIRECTORS

The directors shown below have held office during the whole of the period from 1 June 2017 to the date of this report.

P D P Scally

M Quarrington

M Anderson

P Scally holds options over 2,500,000 Ordinary Shares of 1p each, at an option price of 30p each granted on 22

November 1999.

EMPLOYEE INVOLVEMENT AND DISABLED EMPLOYEES

Within the bounds of commercial confidentiality, staff at all levels are kept fully informed of matters that affect the

progress of the company and are of interest to them as employees.

Disabled persons are given full and fair consideration for all types of vacancy. If an existing employee becomes

disabled, such steps as are practical and responsible are taken to retain him/her in employment. Where appropriate,

assistance with rehabilitation and suitable training are given. Disabled persons have equal opportunities for training,

career development and promotion, except in so far as such opportunities are constrained by the practical limitations of

their disability.

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The directors are responsible for preparing the Report of the Directors and the financial statements in accordance with

applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors

have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting

Practice (United Kingdom Accounting Standards and applicable law), including Financial Reporting Standard 102 'The

Financial Reporting Standard applicable in the UK and Republic of Ireland'. Under company law the directors must not

approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the

company and of the profit or loss of the company for that period. In preparing these financial statements, the directors

are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the

company's transactions and disclose with reasonable accuracy at any time the financial position of the company and

enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for

safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud

and other irregularities.

STATEMENT AS TO DISCLOSURE OF INFORMATION TO AUDITORS

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act

2006) of which the company's auditors are unaware, and each director has taken all the steps that he ought to have taken

as a director in order to make himself aware of any relevant audit information and to establish that the company's

auditors are aware of that information.

AUDITORS

The auditors, Hilden Park Accountants Limited, will be proposed for re-appointment in accordance with Section 485 of

the Companies Act 2006.

This report has been prepared in accordance with the provisions of Part 15 of the Companies Act 2006 relating to small

companies.

ON BEHALF OF THE BOARD:

P D P Scally - Director

8 March 2019

Opinion

We have audited the financial statements of Gillingham Football Club Limited (the 'company') for the year ended

31 May 2018 which comprise the Income Statement, Statement of Financial Position and Notes to the Financial

Statements, including a summary of significant accounting policies. The financial reporting framework that has been

applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting

Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom

Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the company's affairs as at 31 May 2018 and of its profit for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law.

Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the

financial statements section of our report. We are independent of the company in accordance with the ethical

requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard,

and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit

evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to

you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the company's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

Other information

The directors are responsible for the other information. The other information comprises the information in the Report of

the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise

explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing

so, consider whether the other information is materially inconsistent with the financial statements or our knowledge

obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or

apparent material misstatements, we are required to determine whether there is a material misstatement in the financial

statements or a material misstatement of the other information. If, based on the work we have performed, we conclude

that there is a material misstatement of this other information, we are required to report that fact. We have nothing to

report in this regard.

Opinion on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Report of the Directors has been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the company and its environment obtained in the course of the audit,

we have not identified material misstatements in the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you

if, in our opinion:

-	adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches not visited by us; or

-	the financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit; or

-	the directors were not entitled to prepare the financial statements in accordance with the small companies regime and take advantage of the small companies' exemption from the requirement to prepare a Strategic Report or in preparing the Report of the Directors.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page two, the directors are responsible

for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such

internal control as the directors determine necessary to enable the preparation of financial statements that are free from

material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a

going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of

accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic

alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from

material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion.

Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs

(UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are

considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic

decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting

Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the

Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those

matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent

permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's

members as a body, for our audit work, for this report, or for the opinions we have formed.

Paul K. Matthews (Senior Statutory Auditor)

for and on behalf of Hilden Park Accountants Limited

Chartered Accountants

& Statutory Auditors

Hilden Park House

79 Tonbridge Road

Hildenborough

Tonbridge

Kent

TN11 9BH

8 March 2019

TURNOVER

3

7,008,889

6,306,616

Cost of sales

5,236,469

5,215,991

GROSS PROFIT

1,772,420

1,090,625

Administrative expenses

1,591,829

1,454,573

180,591

(363,948

)

Other operating income

-

433,547

OPERATING PROFIT

5

180,591

69,599

Interest payable and similar expenses

68,979

67,515

PROFIT BEFORE TAXATION

111,612

2,084

Tax on profit

-

-

PROFIT FOR THE FINANCIAL YEAR

111,612

2,084

FIXED ASSETS

Tangible assets

7

4,185,693

4,209,893

CURRENT ASSETS

Stocks

8

50,080

146,427

Debtors

9

1,343,465

1,516,965

Cash at bank

259,681

303,181

1,653,226

1,966,573

CREDITORS

Amounts falling due within one year

10

1,451,017

1,642,460

NET CURRENT ASSETS

202,209

324,113

TOTAL ASSETS LESS CURRENT LIABILITIES

4,387,902

4,534,006

CREDITORS

Amounts falling due after more than one year

11

(1,827,794

)

(1,802,548

)

PROVISIONS FOR LIABILITIES

(200,000

)

(200,000

)

ACCRUALS AND DEFERRED INCOME

(665,941

)

(948,903

)

NET ASSETS

1,694,167

1,582,555

CAPITAL AND RESERVES

Called up share capital

470,051

470,051

Share premium

987,469

987,469

Revaluation reserve

13

2,750,000

2,750,000

Retained earnings

(2,513,353

)

(2,624,965

)

SHAREHOLDERS' FUNDS

1,694,167

1,582,555

The financial statements have been prepared in accordance with the provisions of Part 15 of the Companies Act 2006 relating to small companies.

The financial statements were approved by the Board of Directors on 8 March 2019 and were signed on its behalf by:

P D P Scally - Director

1.	STATUTORY INFORMATION

Gillingham Football Club Limited is a private company, limited by shares , registered in England and Wales. The

company's registered number and registered office address can be found on the Company Information page.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with the provisions of Section 1A "Small Entities" of Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

Turnover

Turnover includes gate receipts, Football League pool, commercial activities, advertising, television and radio

fees, donations, sundry related income and the annual release of grants. Advanced invoicing and season ticket

sales are included within deferred income and released to turnover in the relevant accounting period.

Turnover excludes value added tax, transfer fees and amounts due to the Football League, Football Association

and visiting football clubs.

All turnover arises in the United Kingdom.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life.

Fixtures & fittings

-

25% on reducing balance

Motor vehicles

-

25% on reducing balance

Office equipment

-

33% straight line

Priestfield Stadium is held by the company at it's valuation of £4,000,000. The stadium is not depreciated on the

basis that it is constantly maintained and updated.

This policy represents a departure from statutory accounting principles, which require depreciation to be

provided on all fixed assets. The directors consider that this policy is necessary in order that the Financial

Statements may give a true and fair view because the current value is of prime importance rather than the

systematic annual depreciation.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow

moving items.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to

the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or

substantively enacted by the statement of financial position date.

Taxation

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the

statement of financial position date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from

those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that

have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the

timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they

will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension

scheme are charged to profit or loss in the period to which they relate.

Intangible fixed assets

The costs associated with the acquisition of player registrations are capitalised as intangible fixed assets. These

costs are amortised over the period of their contract on a straight line basis. An impairment review is carried out

at the end of each financial year to establish if any events or changes in circumstances indicate the carrying

values may not be recoverable. Signing on fees and subsequent appearance fees are accounted for in the period

in which they become payable or receivable.

Leased assets and hire purchase commitments

Assets financed by hire purchase agreements are included in the company's balance sheet at cost less

depreciation in accordance with the company's normal accounting policies. The present value of future payments

is shown as a liability. The interest element of the repayments is charged to the profit and loss account over the

period of the lease in proportion to the balance of capital payments outstanding. Rentals payable under operating

lease contracts are charged to the profit and loss account as incurred.

Deferred grants

Grants receivable from the Football Trust and similar bodies in respect of capital expenditure are treated as

deferred income and released to the profit and loss account over a future period. This period will equal the

economic life of the assets to which the grant relate in order to match the income to the depreciation charged on

these assets. Deferred grant income in the balance sheet represents total grants received less amounts credited to

the profit and loss account.

3.

TURNOVER

The turnover and profit before taxation are attributable to the one principal activity of the company.

An analysis of turnover by class of business is given below:

31/5/18

31/5/17

£

£

Football tickets

1,251,607

1,646,355

Commercial

533,521

336,134

Independent School

527,633

-

Shop

141,036

171,932

Youth Academy

551,036

464,562

Programmes and membership fees

59,859

69,796

Banqueting & catering

1,196,891

1,062,539

TV and radio revenue

1,437,600

1,471,289

Sundry income & donations

176,206

410,009

Transfer fees

1,133,500

674,000

7,008,889

6,306,616

4.	EMPLOYEES AND DIRECTORS

2018

2017

£

£

Wages and salaries

3,584,576

3,262,721

Social security costs

296,786

280,583

3,543,304

3,543,304

The average monthly number of employees during the year was as follows:

2018

2017

Administration and directors

5

5

Coaches, ground staff and management

17

13

Players

43

43

Other commercial activities

16

19

81

80

These figures do not include staff employed for match days only.

5.	OPERATING PROFIT

The operating profit is stated after charging:

31/5/18

31/5/17

£

£

Depreciation - owned assets

61,384

72,809

Players' registrations amortisation

-

12,950

6.	EXCEPTIONAL ITEMS

31/5/18

31/5/17

£

£

Centerplate settlement

-

433,547

7.	TANGIBLE FIXED ASSETS

Freehold

Fixtures

Motor

Office

property

& fittings

vehicles

equipment

Totals

£

£

£

£

£

COST OR VALUATION

At 1 June 2017

4,000,000

2,294,236

87,575

281,805

6,663,616

Additions

-

51,680

-

8,203

59,883

Disposals

-

(1,682,415

)

(19,410

)

(236,803

)

(1,938,628

)

At 31 May 2018

4,000,000

663,501

68,165

53,205

4,784,871

DEPRECIATION

At 1 June 2017

-

2,104,179

81,884

267,660

2,453,723

Charge for year

-

49,294

1,138

10,952

61,384

Eliminated on disposal

-

(1,660,539

)

(18,587

)

(236,803

)

(1,915,929

)

At 31 May 2018

-

492,934

64,435

41,809

599,178

NET BOOK VALUE

At 31 May 2018

4,000,000

170,567

3,730

11,396

4,185,693

At 31 May 2017

4,000,000

190,057

5,691

14,145

4,209,893

Cost or valuation at 31 May 2018 is represented by:

Freehold

Fixtures

Motor

Office

property

& fittings

vehicles

equipment

Totals

£

£

£

£

£

Valuation in 2012

1,950,000

-

-

-

1,950,000

Valuation in 2016

1,000,000

-

-

-

1,000,000

Cost

1,050,000

663,501

68,165

53,205

1,834,871

4,000,000

663,501

68,165

53,205

4,784,871

If the stadium had not been revalued it would have been included at the following historical cost:

31/5/18

31/5/17

£

£

Cost

1,050,000

1,050,000

Aggregate depreciation

86,000

86,000

Value of land in freehold land and buildings

190,000

190,000

The stadium was valued on an alternative use basis on 31 May 2018 by C Honeywill FRICS - Lambert Smith Hampton

.

Assets held under HP agreements originally cost £55,448 (2017: £44,198) and have a net book value of £40,473

(2017: £21,609). Depreciation charged for the year was £9,643 (2017: £6,386).

8.

STOCKS

31/5/18

31/5/17

£

£

Work-in-progress

-

43,125

Goods for resale

50,080

103,302

50,080

146,427

9.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31/5/18

31/5/17

£

£

Trade debtors

626,777

136,505

Other debtors

464,741

1,268,298

Directors' current accounts

90,547

-

Prepayments and accrued income

161,400

112,162

1,343,465

1,516,965

10.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

31/5/18

31/5/17

£

£

Hire purchase contracts

9,066

9,142

Trade creditors

733,630

686,197

Other taxes and social security

134,779

189,945

Other creditors

11,479

136,603

Directors' loan accounts

498,234

499,617

Accruals and deferred income

63,829

120,956

1,451,017

1,642,460

11.

CREDITORS: AMOUNTS FALLING DUE AFTER MORE THAN ONE YEAR

31/5/18

31/5/17

£

£

Other loans

1,800,000

1,800,000

Hire purchase contracts

27,794

2,548

1,827,794

1,802,548

12.	SECURED DEBTS

The following secured debts are included within creditors:

31/5/18

31/5/17

£

£

Other loans

1,800,000

1,800,000

Hire purchase contracts

36,860

11,690

1,836,860

1,811,690

The other loans are secured by a debenture over the whole of the company's assets and by a legal charge over

Priestfield Stadium, Gillingham (both dated 26 September 2011).

13.

RESERVES

Revaluation

reserve

£

At 1 June 2017

and 31 May 2018

2,750,000

14.	RELATED PARTY DISCLOSURES