’Creative accounting’ in the Spanish professional football League: An attempt to dodge the rules economic control?
Over the past decade, many studies have analysed the contribution of UEFA's Financial Fair Play (FFP) regulations and the Reglamento de Control Económico (RCE) of the Spanish Football League (LFP) to the financial sustainability of clubs. However, compliance with the regulations may create inc...
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| Format: | Article |
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Universidad de Murcia
2025-01-01
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| Series: | Revista de Contabilidad: Spanish Accounting Review |
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| Online Access: | https://revistas.um.es/rcsar/article/view/553911 |
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| author | Rudemarlyn Urdaneta Camacho Juan Carlos Guevara Pérez Emilio Martín Vallespín Fernando Llena Macarulla |
| author_facet | Rudemarlyn Urdaneta Camacho Juan Carlos Guevara Pérez Emilio Martín Vallespín Fernando Llena Macarulla |
| author_sort | Rudemarlyn Urdaneta Camacho |
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Over the past decade, many studies have analysed the contribution of UEFA's Financial Fair Play (FFP) regulations and the Reglamento de Control Económico (RCE) of the Spanish Football League (LFP) to the financial sustainability of clubs. However, compliance with the regulations may create incentives to adopt accounting practices that seek to "dress up" the financial statements of clubs, deviating from the main objective of presenting a true and fair view of the entity. This study analyses the financial and non-financial factors that lead to earnings management practices in Spanish professional football, to identify the impact that the implementation of the LFP RCE has had on the quality of accounting information. Given the importance of intangible assets in the football industry, as they represent the rights paid for the transfer of players, the study uses Key's (1997) model to consider this item to obtain discretionary accrual adjustments. Subsequently, panel data (FGLS) allows us to identify possible relationships between these adjustments and financial and non-financial variables.
The results show that smaller and more leveraged first division clubs are more prone to manipulate their accounting information after the introduction of RCE. In contrast to previous studies focusing on large teams, the present study provides a comprehensive analysis of one of the most popular European leagues (the Spanish league), considering clubs of different sizes. In addition, the study opens a debate on the appropriateness of specific accounting parameters in the football industry, such as the treatment of intangible assets related to player rights, which are one of the main items used by clubs to implement earnings management practices.
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| format | Article |
| id | doaj-art-5dc52b810d3444249a67e50624132f61 |
| institution | Kabale University |
| issn | 1138-4891 1988-4672 |
| language | English |
| publishDate | 2025-01-01 |
| publisher | Universidad de Murcia |
| record_format | Article |
| series | Revista de Contabilidad: Spanish Accounting Review |
| spelling | doaj-art-5dc52b810d3444249a67e50624132f612025-01-10T13:12:24ZengUniversidad de MurciaRevista de Contabilidad: Spanish Accounting Review1138-48911988-46722025-01-0128110.6018/rcsar.553911’Creative accounting’ in the Spanish professional football League: An attempt to dodge the rules economic control?Rudemarlyn Urdaneta Camacho0https://orcid.org/0000-0002-1851-796XJuan Carlos Guevara Pérez1https://orcid.org/0000-0002-1215-7916Emilio Martín Vallespín2https://orcid.org/0000-0003-4315-0642Fernando Llena Macarulla3https://orcid.org/0000-0001-8020-0229University of Zaragoza, Zaragoza-SPAINUniversity of Zaragoza, Zaragoza-SPAIN; University of Castilla-La Mancha, Toledo-SPAINUniversity of Zaragoza, Zaragoza-SPAINUniversidad de Zaragoza - Institute on Employment, Digital Society and Sustainability (IEDIS), Zaragoza-SPAIN Over the past decade, many studies have analysed the contribution of UEFA's Financial Fair Play (FFP) regulations and the Reglamento de Control Económico (RCE) of the Spanish Football League (LFP) to the financial sustainability of clubs. However, compliance with the regulations may create incentives to adopt accounting practices that seek to "dress up" the financial statements of clubs, deviating from the main objective of presenting a true and fair view of the entity. This study analyses the financial and non-financial factors that lead to earnings management practices in Spanish professional football, to identify the impact that the implementation of the LFP RCE has had on the quality of accounting information. Given the importance of intangible assets in the football industry, as they represent the rights paid for the transfer of players, the study uses Key's (1997) model to consider this item to obtain discretionary accrual adjustments. Subsequently, panel data (FGLS) allows us to identify possible relationships between these adjustments and financial and non-financial variables. The results show that smaller and more leveraged first division clubs are more prone to manipulate their accounting information after the introduction of RCE. In contrast to previous studies focusing on large teams, the present study provides a comprehensive analysis of one of the most popular European leagues (the Spanish league), considering clubs of different sizes. In addition, the study opens a debate on the appropriateness of specific accounting parameters in the football industry, such as the treatment of intangible assets related to player rights, which are one of the main items used by clubs to implement earnings management practices. https://revistas.um.es/rcsar/article/view/553911UEFA Financial Fair PlayFootballEarning managementAccountingFinancial performance |
| spellingShingle | Rudemarlyn Urdaneta Camacho Juan Carlos Guevara Pérez Emilio Martín Vallespín Fernando Llena Macarulla ’Creative accounting’ in the Spanish professional football League: An attempt to dodge the rules economic control? Revista de Contabilidad: Spanish Accounting Review UEFA Financial Fair Play Football Earning management Accounting Financial performance |
| title | ’Creative accounting’ in the Spanish professional football League: An attempt to dodge the rules economic control? |
| title_full | ’Creative accounting’ in the Spanish professional football League: An attempt to dodge the rules economic control? |
| title_fullStr | ’Creative accounting’ in the Spanish professional football League: An attempt to dodge the rules economic control? |
| title_full_unstemmed | ’Creative accounting’ in the Spanish professional football League: An attempt to dodge the rules economic control? |
| title_short | ’Creative accounting’ in the Spanish professional football League: An attempt to dodge the rules economic control? |
| title_sort | creative accounting in the spanish professional football league an attempt to dodge the rules economic control |
| topic | UEFA Financial Fair Play Football Earning management Accounting Financial performance |
| url | https://revistas.um.es/rcsar/article/view/553911 |
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