After approving a Budget of over 70 Million Ghana Cedis for the Ghana Football Association to be used over the 2020-2021 Financial year, the Congress of the Association has set itself to a long term financial battle that is projected to cause a much more financial burden on the Association, and its members.
Critical analysis of the revenue streams available to the FA over the first two years of this administration shows the Ghana FA is only able to raise a little over 40% of its revenues through Sponsorship.
The FA has over the two years raised more than 50% of its revenues from International Grants that cannot be sustained in subsequent years.
Of the 17,600,000 Ghana Cedis of the FA’s revenue generated from International grants in the 2019-2020 financial year, 13,750,000 representing 78% came from Grants that will never be accessed again because of the circumstances and timelines of its operations that led to the FA assessing them.
The FIFA Forward 1.0 program has since 2018 been halted by FIFA, and therefore no other member Association will have access to this going forward.
For the 2020-2021 financial year, over 64% of the FA’s expected revenues [₵46,930,984.00] are from Grant’s whiles 60% of these revenues representing [₵27,728,984] will not be available for the FA’s future revenues.
From the Above coupled analysis, and on the grounds that fact the Association is unable to raise a substantial amount of monies from Sponsorship, one would expect the Association to be prudent in its spending considering the COVID-19 pandemic has served a very ‘successful’ path towards raising revenues from their international partners.
It is clear the 2021-2022 financial year, the Association will likely have a revenue deficit of over ₵ 28,000,000 representing 39% of the previous year’s revenues streams of Grants from FIFA, CAF, EC, and UEFA.
With the current Spending plan of the Association against the revenue generation, it would be miraculous for the FA to meet the revenue shortfalls of 39% after failing to demonstrate beyond reasonable doubt it would be in a position to raise same from Sponsorship.
Spending almost 15% of the Association’s revenues on payment of Compensation to its Officers, and other committee sittings is certainly not a best financial practice.
The Current Expenditure practice is dangerous to the Association taking into account they cannot raise a double of the current Sponsorship revenues.
Having approved over 8 million Ghana Cedis for the payment of allowance to committees, Foreign and domestic travel allowances, Tickets and Accommodations, and the Payment of Salaries to FA staff, an amount that is virtually same as the amount raised from Sponsorship, the Association must take note of the fact that this practice would need to be sustained within the next two Football seasons.
The future grants, if accessed by the FA may not be able to make up for the deficits in Compensation to the members of the executive council as they are earmarked by the Granting authority [FIFA] for a specific use.
One would have expected the Congress to ensure the executive council proved beyond a reasonable doubt, that they had the capacity to raise the remainder of the revenues going into the future where there won’t be any further COVID-19 relief funds or FIFA Forward 1.0 funds.
At the prevailing spending structure, the only avenue to reduce cost is for the Association to cut off its infrastructure development in the next two years to make up for the loses expected to be incurred.
Source: Chief Seidu [442gh.com]