The Union of European Football Associations (UEFA) Financial Fair Play regulations (FFP rules) might create a conflict of interest for some accountancy firms, the International Accounting Bulletin has found.

The new FFP rules are focused around the idea that clubs can’t spend more than they earn and can only report a minimum amount of loss in their accounting books.

To qualify for participation in the European club competitions, clubs will have to submit each year (for the first time by mid-July 2014) their financial information for the past year through a web based IT solution provided by UEFA. From there the figures will be reviewed to ensure that clubs are compliant.

"Checks are done by UEFA. Only in certain cases accounting firms may be asked to intervene. These are Deloitte or PwC," a UEFA spokesperson tod the IAB.

In England, Deloitte audits Arsenal FC while PwC is the auditor of Manchester United FC, both firms are also auditors of clubs in continental Europe which will participate in European competitions.

Asked by the International Accounting Bulletin if this represented a potential conflict of interest and in which case the accounting firms will be asked to intervene, UEFA did not comment and Deloitte said it wasn’t for them to comment.

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PwC sport and leisure sector leader Julie Clark said: "For any of our assignments we go through all the checks to insure that we have no conflicts of interest, and there wouldn’t be anything different in this instance."

Some observers have raised concerns that the FFP rules will be a smokescreen for clubs to carry on unhealthy financial practices.

Players transfers
Only few are opposed to UEFA FFP rules but the critics point at loopholes such as the reporting of player transfers and sponsorship deals, where clubs are allowed a certain leniency in the timing in which they report an income and a loss.

"For example, Real Madrid acquired Gareth Bale for £85m on a six years contract; they will amortise this figure and report a loss of £14m per year for six years." Chartered Institute of Management Accountants (CIMA) executive director for education Noel Tagoe said.
"On the other hand they have sold players to Italian and English clubs for a similar fee to what they spend for Bale and they will report the totality of these incomes in this financial year, resulting in a profit when they actually broke even."

Accountancy firms will play a big part in the success or the failure of the FFP rules, as Tagoe summarised: "In terms of accountancy there is some latitude in interpreting the rules, and accounting firms shouldn’t encourage an aggressive interpretation of the rules."

Read the full report on UEFA’s FFP rules