IPSWICH_TOWN_FOOTBALL_CLU - Accounts

The directors present the strategic report for the year ended 30 June 2022.

The 2021/​22 season represented a pleasing year for the Club overall. The unrestricted return of supporters to stadia all over the country was a particular highlight, as was the Club's first full season under new ownership. The trading results predominantly reflect the variance between a COVID-impacted season in the prior year, versus a season in which supporters were able to attend live football matches. In addition, the Club began to see a renewed engagement from the fanbase, with attendance records in the second half of the season averaging more than 22,000, a significant improvement from pre-COVID trends.

The Group has continued to measure its performance using several key performance indicators, such as final position in the league, average league attendance and profitability, albeit noting the pandemic impacted upon attendance and turnover.

                         2020/​21         2021/​22

League Position                        9th             11th    

Turnover (£m)                        8.1            14.4

Operating Profit/​(Loss) (£m)                (7.7)            (14.3)

Average League Attendance                174            19,549

Season Ticket Sales                    0            12,870

Wage Costs (£m)                     13.9            16.4

Whilst league position declined versus the prior season, The Club is pleased with the trajectory of the playing squad and leadership under the new management team that was implemented midway through the season. The improvement in turnover is also positive given this reflects real-term increases from pre-pandemic performance.

As anticipated following the change in ownership of the Club, significant investment has arisen across all aspects of operations, including playing staff, non-playing staff, property and infrastructure. As a result, the cost base of the operation expanded significantly, and well beyond that of incremental incomes achieved from growing attendances and increase retail spending.

It is acknowledged the Club is loss-making and is forecast to remain loss-making whilst competing in League One of the Football League pyramid. Whilst it is a target of the Club to achieve promotion to the Championship, the Company has a secure funding source from its ownership group to support the losses of the club.

The directors consider that the principal risk facing both this company and the subsidiaries of Ipswich Town Football Club Limited (‘the Group’) is the performance and the divisional status of Ipswich Town Football Club (“ITFC”). The implications this has on the Group’s ability to generate revenue streams are significant, albeit mitigated by the financial strength and support provided by the parent company.

The Club is regulated by the rules of the FA, EFL, UEFA and FIFA. Any changes to the regulations of these bodies could have an impact on the Group as they cover areas such as competition format, distribution of media income, player eligibility and operation of the transfer market. The board ensures compliance with the relevant rules and regulations and monitors and considers the impact closely of any potential changes.

On behalf of the board

The directors present their annual report and financial statements for the year ended 30 June 2022.

The principal activity of the Group is the operation of a professional football club, together with related ancillary activities.

The results for the year are set out on page 9.

No ordinary dividends were paid. The directors do not recommend payment of a further dividend.

The directors who held office during the year and up to the date of signature of the financial statements were as follows:

The Group’s principal financial instruments include loans from fellow group companies, the main purpose of which is to finance the Group’s operations. In addition, the Company has various other financial assets and liabilities such as trade receivables and trade payables arising directly from its operations.

The Group reviews forecasts regularly to identify funding requirements and manage the Group funding levels accordingly to reduce liquidity risk. Credit risk is reduced by negotiating appropriate terms with debtors and creditors, and monitoring on an ongoing basis.

Post balance sheet events are discussed in note 25 to the financial statements.

The short term objective of the Club is to re-build a competitive playing squad and secure promotion back to the Championship. The medium term plan is to increase revenues at the Club through continued investment both on and off the field.

In accordance with the company's articles, a resolution proposing that Ensors Accountants LLP be reappointed as auditor of the group will be put at a General Meeting.

So far as each person who was a director at the date of approving this report is aware, there is no relevant audit information of which the auditor of the company is unaware. Additionally, the directors individually have taken all the necessary steps that they ought to have taken as directors in order to make themselves aware of all relevant audit information and to establish that the auditor of the company is aware of that information.

The directors are responsible for preparing the Annual Report 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). 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 group and company, and of the profit or loss of the group 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;

•     state whether applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the ;

•     prepare the on the going concern basis unless it is inappropriate to presume that the group and company will continue in business.

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the group’s and company’s transactions and disclose with reasonable accuracy at any time the financial position of the group and 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 group and company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

We have audited the financial statements of Ipswich Town Football Club Company Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 30 June 2022 which comprise the group statement of comprehensive income, the group balance sheet, the company balance sheet, the group statement of changes in equity, the company statement of changes in equity, the group statement of cash flows and notes to the financial statements, including 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 group's and the parent company's affairs as at 30 June 2022 and of the group's loss 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 Auditor's responsibilities for the audit of the financial statements section of our report. We are independent of the group and parent 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

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group's and parent company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Other information

The other information comprises the information included in the annual report other than the financial statements and our auditor's report thereon. The directors are responsible for the other information contained within the annual report. 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. 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 course of 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 this gives rise to a material misstatement in the financial statements themselves. 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.

Opinions on other matters prescribed by the Companies Act 2006

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

• the information given in the strategic report and the directors' report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and the directors' report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the group and the parent company and their environment obtained in the course of the audit, we have not identified material misstatements in the strategic report or the directors' report.

We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report to you if, in our opinion:

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

• the parent company 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.

As explained more fully in the directors' responsibilities statement, 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 is 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 parent 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 parent company or to cease operations, or have no realistic alternative but to do so.

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 an auditor's report 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.

Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.

Our audit was designed to include tests of detail together with an assessment of the control environment to enable us to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement due to fraud. This included work on areas where we consider there is a higher risk of fraud including transactions with related parties, revenue recognition, management override of systems and control and accounting estimates.

In identifying and assessing risks of material misstatement in respect of irregularities, including fraud, the audit engagement team:

• obtained an understanding of the nature of the industry and sector, including the legal and regulatory framework that the company operates in and how the company are complying with the legal and regulatory framework;

• inquired of management, and those charged with governance, about their own identification and assessment of the risks of irregularities, including any known, actual, suspected or alleged instances of fraud;

• discussed matters about non-compliance with laws or regulations and how fraud might occur including assessment of how and where the financial statements may be susceptible to fraud.

• robustly challenged accounting estimates to ensure no indication of management bias.

However, it is the primary responsibility of management, with the oversight of those charged with governance, to ensure that the entity's operations are conducted in accordance with the provisions of laws and regulations and for the prevention and detection of fraud.

A further description of our responsibilities is available on the Financial Reporting Council’s website at: https://www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor's report.

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 an auditor's report 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.

As permitted by s408 Companies Act 2006, the company has not presented its own profit and loss account and related notes. The company’s profit for the year was £13,104,339 (2021 - £5,608,724 loss). The company accounting profit arose due to the simplification of the ITFC Group. See note 14 for further details of this.

Ipswich Town Football Club Company Limited (“the company”) is a private limited company domiciled and incorporated in England and Wales. The registered office is Ipswich Town Football Club, Portman Road, Ipswich, IP1 2DA.

The group consists of Ipswich Town Football Club Company Limited and all of its subsidiaries.

These financial statements have been prepared in accordance with FRS 102 “The Financial Reporting Standard applicable in the UK and Republic of Ireland” (“FRS 102”) and the requirements of the Companies Act 2006.

The financial statements are prepared in sterling, which is the functional currency of the company. Monetary amounts in these financial statements are rounded to the nearest £'000.

The financial statements have been prepared under the historical cost convention. The principal accounting policies adopted are set out below.

The company is a qualifying entity for the purposes of FRS 102, being a member of a group where the parent of that group prepares publicly available consolidated financial statements, including this company, which are intended to give a true and fair view of the assets, liabilities, financial position and profit or loss of the group. The company has therefore taken advantage of exemptions from the following disclosure requirements for parent company information presented within the consolidated financial statements:

• Section 7 ‘Statement of Cash Flows’: Presentation of a statement of cash flow and related notes and disclosures;

• Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instrument Issues’: Interest income/expense and net gains/losses for each category of financial instrument; basis of determining fair values; details of collateral, loan defaults or breaches, details of hedges, hedging fair value changes recognised in profit or loss and in other comprehensive income;

• Section 33 ‘Related Party Disclosures’: Compensation for key management personnel.

The consolidated group financial statements consist of the financial statements of the parent company Ipswich Town Football Club Company Limited together with all entities controlled by the parent company (its subsidiaries) and the group’s share of its interests in joint ventures and associates.

All financial statements are made up to 30 June 2022. Where necessary, adjustments are made to the financial statements of subsidiaries to bring the accounting policies used into line with those used by other members of the group.

All intra-group transactions, balances and unrealised gains on transactions between group companies are eliminated on consolidation. Unrealised losses are also eliminated unless the transaction provides evidence of an impairment of the asset transferred.

The directors have considered the factors that impact the Group’s future development, performance, cash flows and financial position along with the Group’s current liquidity in forming their conclusion on the applicability of the going concern basis.

As outlined in the strategic report, accompanying these financial statements, the Group made a loss in the year ended 30 June 2022. Notwithstanding the net current liabilities of £6,071,000 (2021: £4,992,000) and a net operating cash outflow of £11,447,000 (2021: £3,982,000) the financial statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons.

The directors have prepared cash flow forecasts for a period of 12 months from the date of approval of these financial statements which indicate that, taking account of reasonably possible downsides, the Group will require funding from its owners, to meet its liabilities as they fall due for that period. The ultimate parent entity has provided the directors with a letter of support detailing their intention to provide financial support for at least 12 months from the date of approval of these financial statements, in particular that it will continue to make available such funds as are needed by the company to continue in operational existence by meeting their liabilities as they fall due. The directors are satisfied the ultimate parent entity has ability to provide the level of support required. 

Consequently, at the time of approving the financial statements, the directors have a reasonable expectation that the group has adequate resources to continue in operational existence for the foreseeable future. Thus, the directors continue to adopt the going concern basis of accounting in preparing the financial statements.

Turnover is recognised at the fair value of the consideration received or receivable for goods and services provided in the normal course of business, and is shown net of VAT and other sales related taxes. The fair value of consideration takes into account trade discounts, settlement discounts and volume rebates.

Revenue from the sale of goods is recognised when the significant risks and rewards of ownership of the goods have passed to the buyer (usually on dispatch of the goods), the amount of revenue can be measured reliably, it is probable that the economic benefits associated with the transaction will flow to the entity and the costs incurred or to be incurred in respect of the transaction can be measured reliably.

Turnover from sale of services represents match receipts, executive box rentals, sponsorships, commercial and other income arising from the ordinary activities of the group and excludes transfer fees receivable and value added tax. Television income is recognised in the period in which the relevant matches are televised and gate receipt income is taken to profit and loss account when the matches are played. Advance season ticket sales are included within deferred income and released to turnover in the relevant season.

Income from the East Anglian Association and Ipswich Town Development Association being donations to the Club is recognised in the financial year for the season to which it relates.

Intangible fixed assets represent transfer fees and league levies associated with the acquisition of players’ registrations which are capitalised as intangible fixed assets and amortised over the period of the player’s contract. Provision for any impairment in value, such as through injury or loss of form, is made when it becomes apparent that the diminution in value is permanent.

Tangible fixed assets are initially measured at cost and subsequently measured at cost or valuation, net of depreciation and any impairment losses.

Depreciation is recognised so as to write off the cost or valuation of assets less their residual values over their useful lives on the following bases:

The gain or loss arising on the disposal of an asset is determined as the difference between the sale proceeds and the carrying value of the asset, and is recognised in the profit and loss account.

In the parent company financial statements, investments in subsidiaries are initially measured at cost and subsequently measured at cost less any accumulated impairment losses.

A subsidiary is an entity controlled by the group. Control is the power to govern the financial and operating policies of the entity so as to obtain benefits from its activities.

At each reporting period end date, the group reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where it is not possible to estimate the recoverable amount of an individual asset, the company estimates the recoverable amount of the cash-generating unit to which the asset belongs.

Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset for which the estimates of future cash flows have not been adjusted.

If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (or cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised immediately in profit or loss, unless the relevant asset is carried at a revalued amount, in which case the impairment loss is treated as a revaluation decrease.

Stocks are stated at the lower of cost and net realisable value. The cost of stock is calculated using the purchase price on a weighted average basis.

At each reporting date, an assessment is made for impairment. Any excess of the carrying amount of stocks over its estimated selling price less costs to complete and sell is recognised as an impairment loss in profit or loss. Reversals of impairment losses are also recognised in profit or loss.

Cash and cash equivalents are basic financial assets and include cash in hand, deposits held at call with banks, other short-term liquid investments with original maturities of three months or less, and bank overdrafts. Bank overdrafts are shown within borrowings in current liabilities.

The group has elected to apply the provisions of Section 11 ‘Basic Financial Instruments’ and Section 12 ‘Other Financial Instruments Issues’ of FRS 102 to all of its financial instruments.

Financial instruments are recognised in the group's balance sheet when the group becomes party to the contractual provisions of the instrument.

Financial assets and liabilities are offset and the net amounts presented in the financial statements when there is a legally enforceable right to set off the recognised amounts and there is an intention to settle on a net basis or to realise the asset and settle the liability simultaneously.

Basic financial assets, which include debtors, cash, amounts due from fellow group companies and bank balances are initially measured at transaction price including transaction costs and are subsequently carried at amortised cost using the effective interest method unless the arrangement constitutes a financing transaction, where the transaction is measured at the present value of the future receipts discounted at a market rate of interest. Financial assets classified as receivable within one year are not amortised.

Financial assets are assessed for indicators of impairment at each reporting end date. Financial assets are impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the estimated future cash flows have been affected. If an asset is impaired, the impairment loss is the difference between the carrying amount and the present value of the estimated cash flows discounted at the asset’s original effective interest rate. The impairment loss is recognised in profit or loss.

Financial assets are derecognised only when the contractual rights to the cash flows from the asset expire or are settled, or when the group transfers the financial asset and substantially all the risks and rewards of ownership to another entity, or if some significant risks and rewards of ownership are retained but control of the asset has transferred to another party that is able to sell the asset in its entirety to an unrelated third party.

Financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities.

Basic financial liabilities, including trade and other creditors, transfer fees payable, amounts due from fellow group companies and preference shares that are classified as debt, are initially recognised at transaction price unless the arrangement constitutes a financing transaction, where the debt instrument is measured at the present value of the future payments discounted at a market rate of interest. Financial liabilities classified as payable within one year are not amortised.

Debt instruments are subsequently carried at amortised cost, using the effective interest rate method.

Trade creditors and transfer fees payable are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers. Amounts payable are classified as current liabilities if payment is due within one year or less. If not, they are presented as non-current liabilities. Trade creditors are recognised initially at transaction price and subsequently measured at amortised cost using the effective interest method.

Financial liabilities are derecognised when the group's contractual obligations expire or are discharged or cancelled.

Equity instruments issued by the group are recorded at the proceeds received, net of transaction costs. Dividends payable on equity instruments are recognised as liabilities once they are no longer at the discretion of the group.

The costs of short-term employee benefits are recognised as a liability and an expense. The cost of any unused holiday entitlement is recognised in the period in which the employee’s services are received. Termination benefits are recognised immediately as an expense when the company is demonstrably committed to terminate the employment of an employee or to provide termination benefits.

Signing on fees are due to players if they are still in the service of the Club on future dates specified in their contacts. They are charged to the profit and loss account as they fall due. The element of such signing on fees not yet payable is disclosed as a commitment.

The group operates various defined contribution schemes. The assets of the schemes are held separately from those of the group in independently administered funds. The amount charged to the profit and loss account represents the contributions payable to the scheme in respect of the accounting period.

The group also continues to make contributions in respect of its share of the deficit on the defined benefit section of the Football League Limited Pension and Life Assurance Scheme (suspended in 1999). As one of a participating employers the group is advised only of its share of the Scheme deficit and accordingly recognises a liability in respect of this.

Rentals payable under operating leases, including any lease incentives received, are charged to profit or loss on a straight line basis over the term of the relevant lease except where another more systematic basis is more representative of the time pattern in which economic benefits from the leased asset are consumed.

Grants receivable relating to capital expenditure are treated as deferred income in the balance sheet and released to the profit and loss account over the estimated useful economic lives of the assets to which they relate.

Deferred income

Deferred income relating to ticket revenues received in advance is shown within accruals and deferred income.

In the application of the company’s accounting policies, the directors are required to make judgements, estimates and assumptions about the carrying amount of assets and liabilities that are not readily apparent from other sources. The estimates and associated assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.

The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised where the revision affects only that period, or in the period of the revision and future periods where the revision affects both current and future periods.

The following have been identified as being significant judgements and estimates:

Depreciation of tangible fixed assets

Tangible fixed assets are depreciated to write off the cost of the asset, less any residual value, over its useful life. Estimates of useful lives are based on the nature of the asset and management’s experience. The actual useful lives of assets may vary depending on a range of factors.

Impairment of fixed assets

When assessing fixed assets for impairment management apply judgement in determining whether there have been any indications of impairment, such as whether there has been loss of form of a player, and a reliable basis to determine the recoverable amount of the investment which may involve estimates of future cash flows and events.

All turnover arises purely from operations related to the football club in the United Kingdom.

These amounts represent the total compensation offered to season ticket holders due to games being played behind closed doors.

The average monthly number of persons (including directors) employed by the group and company during the year was:

Their aggregate remuneration comprised:

The number of directors for whom retirement benefits are accruing under defined contribution schemes amounted to 1 (2021 - 1).

The actual charge for the year can be reconciled to the expected credit for the year based on the profit or loss and the standard rate of tax as follows:

The group has unused tax losses of £73,884,000 (2021: £61,697,000)

Details of the company's subsidiaries at 30 June 2022, all of which are registered in England and Wales at Portman Road, Ipswich IP1 2DA, are as follows:

During the year a simplification of the ITFC Group was completed. The intra-group balances have been realised or formerly waived and the Company received dividend income amounting to the remaining reserves of the subsidiaries. This also resulted in the Company impairment loss shown in note 13. All dividends and loans waivers have been eliminated on consolidation of the ITFC Group. Going forwards these subsidiaries will be dormant.

Other creditors include a provision of £536,000 (2021: £1,976,000) for compensation options offered to season ticket holders in respect of the 2020/21 season.

Included in accruals and deferred income is £1,097,000 (2021: £1,139,000) in relation to historic capital grants received for the development of the stadium which is being released to the income statement over the estimated useful life of the assets to which they relate.

Loans from related parties are in respect of an arrangement whereby an entity, with a participating interest in the Company issued loan notes and the proceeds were lent to the Company under the same terms. Under these terms the Company made loan repayments of £41,000 (2021: £47,000) and was charged interest of £26,000 (2021: £39,000) during the year.

A defined contribution pension scheme is operated for all qualifying employees. The assets of the scheme are held separately from those of the group in an independently administered fund.

The Group participates in the Football League Pension and Life Assurance Scheme (“the Scheme”). The Scheme is a funded multi-employer defined benefit scheme, with 92 participating employers, and where members may have periods of service attributable to several participating employers. The Group is unable to identify its share of the assets and liabilities of the Scheme and therefore accounts for its contributions as if they were paid to a defined contribution scheme.

The last actuarial valuation was carried out at 31 August 2020 where the total deficit on the ongoing valuation basis was £27.5 million. The results of the 2020 valuation were rolled forward to 30 June 2022 on the same assumptions as detailed above, and the Club’s notional share of the deficit was £566,000 (2021: £654,000).

The Group currently pays total contributions of £114,000 per annum (increasing by 5% pa on each 1 September) and based on the actuarial valuation assumptions will be sufficient to pay off the deficit by 30 June 2027. As at 30 June 2022, based on an appropriate discount rate of 3.35% per annum (2021: 0.78% the present value of the Club’s outstanding contribution is £601,000 (2021: £747,000). This amounts to £118,000 (2021: £113,000) due within one year and £482,000 (2021: £635,000) due after more than one year and is included within other creditors.

The Redeemable Preference Shares of 25p each have the following rights:

• a fixed cumulative dividend at the rate of 7.0 per cent per annum (net) on capital provided there are profits available for distribution. The dividend accrues on daily basis and shall be payable on 31 July in respect of each 12 month period ended 30 June.

• redemption of all or some of the Preference Shares outstanding at any time after the expiration of a period of five consecutive seasons of the Premier League during which time the company remains in the Premier League. The Preference Shares shall rank on such a return of capital in priority to all other shares of the Company from time to time in issue.

The Redeemable Preference Shares are non-voting unless the business of the meeting includes consideration of a resolution which varies the rights attached to the Preference Shares.

During the year 55,000,000 Ordinary Shares of aggregate nominal value £13,750,000 were allotted for a consideration of £19,250,000 paid by the parent company.

Represents the premium arising on the issue of shares net of issue costs.

Other reserves relate to amounts received from the parent company for share issues prior to board resolutions formally allotting the shares. Other movements in this reserve relate to the consideration for shares allotted during the year which had been received in the previous period.

Includes all current and prior period retained realised profits and losses.

Player Transfers

The Club is contractually bound to pay additional amounts in respect of transferred players should certain criteria be met. The maximum amount of this contingent liability is £652,000 (2021: £200,000) excluding amounts which have been provided for and those which are considered to have a remote likelihood of becoming due.

At the reporting end date the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

Following the simplification of the ITFC group the company has stepped in as a party to the lease of the stadium with a subsidiary company.

The parent company is Gamechanger 20 Limited, a company registered in England and Wales, by virtue of its majority shareholding in the company. Its registered office is Ipswich Town Football Club, Portman Road, Ipswich, England, IP1 2DA.

The directors consider ORG Az Secondary Opportunity Fund, L.P. as the ultimate parent entity. The directors do not consider there to be an ultimate controlling party.

Entities with control over the entity

The Redeemable Preference Shares (see note 21) are held by the Parent Company. Preference share dividends of £705,000 (2021: £141,000) have accrued to the Parent Company in accordance with the share rights (see note 21).

There is a service level agreement in place between the Company and the Parent Company, resulting in the recharge of costs incurred by the Parent Company. During the year a management charge of £1,669,000 has been incurred. At the year end, the Company owed £1,694,000 to the Parent Company.

Other related parties

During the year management charges of £53,000 (2021: £70,000) under a Service Level Agreement, were made to a Charity in which two directors who served during the year were also trustees. Donations are taken on behalf of the Charity. At the year end the Company was due £98,000 (2021: was owed £28,000) from the Charity.

Player movements

Since the year end the group has acquired player registrations totalling £5,970,000 including contingent payments.

Capital funding

Since the year end £17,960,000 has been received from the parent company for share issues prior to board resolutions formally allotting the shares.