MANCHESTER CITY FOOTBALL CLUB LIMITED

Annual Report and Financial Statements

For the year ended 30 June 2021

Registered number 00040946

FINANCIAL
REPORT
CONTENTS

Directors and Company Information 03

Strategic Report 06
Directors’ Report 09
Statement of Directors’ Responsibilities 12
Independent Auditors’ Report to the Members
of Manchester City Football Club Limited 14
Statement of Profit or Loss 18
Balance Sheet 20
Statement of Changes in Equity 22
Notes to the Financial Statements 24

Manchester City 2020-21 Annual Report 2

 DIRECTORS AND
COMPANY INFORMATION

Manchester City 2020-21 Annual Report 3

DIRECTORS AND COMPANY INFORMATION

DIRECTORS
K Al Mubarak (Chairman)
M Edelman
S Pearce
J MacBeath
M Al Mazrouei
A Galassi
A Khouri

COMPANY
SECRETARY
S Cliff

REGISTERED
OFFICE
Etihad Stadium, Etihad Campus,
Manchester M11 3FF

BANKERS
Barclays Bank PLC, 51 Mosley Street,
Manchester M60 2AU

AUDITORS
BDO LLP, 3 Hardman Street,
Manchester M3 3AT

Manchester City 2020-21 Annual Report 4

DIRECTORS AND COMPANY INFORMATION CONTINUED

The Board of Directors comprises the following who are all non-Executive Directors:

KHALDOON AL MUBARAK, CHAIRMAN JOHN MACBEATH, MEMBER OF THE BOARD

Khaldoon Al Mubarak was appointed to the Board in September 2008. John MacBeath was appointed to the Board in January 2010. He also
served as Interim Chief Executive Officer of Manchester City FC from
Mr Al Mubarak is the Managing Director and Group Chief Executive
September 2011 to September 2012.
Officer of Mubadala Investment Company. He also serves as the
Chairman of the Boards of the Emirates Nuclear Energy Corporation, John MacBeath is a Chartered Accountant with extensive international
Abu Dhabi Commercial Bank and Emirates Global Aluminium and sits business experience in the oil and gas, and aerospace industrial sectors.
on the Board of the Abu Dhabi National Oil Company. He is also
Chairman of the Executive Affairs Authority of Abu Dhabi and a member
of the New York University Board of Trustees. MOHAMED AL MAZROUEI, MEMBER OF THE BOARD
Mohamed Al Mazrouei was appointed to the Board in January 2010.
MARTIN EDELMAN, MEMBER OF THE BOARD Since April 2008, Mr Al Mazrouei has served as the Undersecretary
of the Crown Prince Court of Abu Dhabi. He is also the Chairman
Martin Edelman was appointed to the Board in September 2008.
of Etihad Airways, and the former Chairman of Abu Dhabi Media.
He is also Vice Chairman of New York City FC.
Since June 2000, he has been Of Counsel to Paul Hastings LLP,
a New York City law firm. Mr Edelman also currently serves as ALBERTO GALASSI, MEMBER OF THE BOARD
Chairman of Manchester Life Development Company and as
Alberto Galassi was appointed to the Board in June 2012.
Director of Equity Commonwealth, BXMT and Aldar. He is also
on the Advisory Board at Columbia University’s Business School. Alberto Galassi is the CEO of Ferretti Group, a multinational shipbuilding
company and leader in luxury yachts. Mr Galassi is an attorney at law
Mr Edelman works on behalf of several philanthropic initiatives
specialised in international commerce and arbitration.
and is on the boards of the Jackie Robinson Foundation,
Intrepid Fallen Heroes Fund, Fisher Alzheimer Center and
Tribeca Film Institute. ABDULLA KHOURI, MEMBER OF THE BOARD
Abdulla Khouri was appointed to the Board in July 2018.
SIMON PEARCE, MEMBER OF THE BOARD Mr Khouri is the Chairman of Abu Dhabi Motorsport Management, operator
Simon Pearce was appointed to the Board in September 2008. of Yas Marina Circuit and home of the F1 Etihad Airways Abu Dhabi Grand
He is also Vice Chairman of Melbourne City FC. Prix, and Flash Entertainment, the leading music, sports, and entertainment
events company based in Abu Dhabi. He is a Board Member of Miral, Abu
In 2006, Mr Pearce joined the Executive Affairs Authority of Abu
Dhabi’s leading curator of experiences. Abdulla is also the Executive Director
Dhabi, and currently serves as Special Advisor to the Chairman.
of Government Affairs for the Executive Affairs Authority of Abu Dhabi.
He is also a Board Member of Abu Dhabi Motorsports Management,
operator of Yas Marina Circuit and home of the F1 Etihad Airways
Abu Dhabi Grand Prix, and a Board Member of Manchester Life
Development Company.

Manchester City 2020-21 Annual Report 5

 STRATEGIC
REPORT

Manchester City 2020-21 Annual Report 6

STRATEGIC REPORT

The Directors present their annual report on the affairs of Manchester City
Football Club Limited (‘Manchester City’ or ‘the Club’), together with the financial
statements and Independent Auditors’ Report, for the year ended 30 June 2021.

PRINCIPAL ACTIVITIES
The principal activity is the operation of a professional football club.

BUSINESS REVIEW AND KEY PERFORMANCE INDICATORS

In the 2020-21 season, Manchester City won its fifth Premier League in ten years, third in four Across the whole of the 2020-21 financial year, matchday revenue was significantly impacted,
years, setting a new record for the most consecutive wins by a top-flight English team in all with ticketing and hospitality revenues falling to almost zero, as a result of all but one match
competitions and reached an historic first UEFA Champions League (‘UCL’) final. 6,000 fans being played behind closed doors. This is the first time in the Club’s history that almost the
travelled to Porto to support the team, and despite a 1-0 loss against Chelsea, it was widely whole season has been played without fans and the associated revenues.
recognised that a new benchmark had been set for Manchester City.
Separate from these COVID-19-related factors, the most significant impact on revenues
The Club reached the FA Cup semi-final for the second season in a row, and victory in the this year is a large 56% boost to broadcast income, primarily due to the Club reaching the
League Cup meant that City have now won ten of the total available 16 major domestic UCL final. The overall effect is that total revenues increased year-on-year by £91.5m, 19.1%
men’s trophies in the last four years, more than any other team. (2020: £56.8m decrease, -10.6%). At £569.8m, they are now higher than in any previous year.
The Club returned to profit, as anticipated in last year’s Annual Report. The net profit in
This was the second season since the COVID-19 pandemic began, and fans were only able
2020-21 was £2.4m (2020: £126.0m loss), owing to a combination of strong broadcasting
to attend one home game, the final match against Everton, with a capacity capped in line with
and commercial growth this year and the inclusion of some revenues for games from the
UK government directives. The 10,000 fans in attendance were able to witness Sergio Aguero’s
2019-20 season. The Club has net assets of more than £656m.
final two goals in a Manchester City shirt as he left the Club having set a record as the highest
non-English Premier League goal scorer. As a result of the impact of the pandemic on the Club’s trading and operations, year-on-year
comparisons for revenues, costs, profits, and key ratios will be partly misleading and, for full
This year’s financial figures are impacted by the delay in the completion of the previous
context, the 2020-21 results should be viewed alongside the 2019-20 results. This has been
2019-20 season, which was paused early in the pandemic on 13 March 2020 and resumed
recognised by UEFA and exceptional changes to their licensing and regulatory approach will
after a three-month absence on 17 June 2020. Consequently, matches relating to just under
assess the combined results of both seasons. The Directors are confident that the Club’s
a quarter of the 2019-20 Premier League season and the latter stages of that season’s UCL
results for the two-year period meet UEFA’s adjusted Financial Fair Play requirements.
and FA Cup competitions were played in July and August 2020 and therefore revenue for
these matches has been included in these 2020-21 financial statements. This marks the
first Premier League season that has straddled two financial years.

Manchester City 2020-21 Annual Report 7

STRATEGIC REPORT CONTINUED

The Club also measures key performance against the following indicators:
2020-21 2019-20
Key performance indicator

First team performance – Premier League finishing position 1st place 2nd place

First team performance – UEFA Champions League Runner-Up Quarter-Final

Employee costs/revenue 62%* 73%*

Average league home attendance (all except one 2020-21 fixture played behind closed doors) N/A 54,219

Profit on disposal of players’ registrations £68.5m £39.8m

*This key performance indicator has been significantly impacted by COVID-19 and is not representative as revenues for the 2019-20 season straddle two financial years. Manchester City showed
commitment to their employees by not using the government furlough scheme and not making any redundancies in either the 2020-21 or 2019-20 financial years because of the pandemic.

RISKS AND UNCERTAINTIES SECTION 172 (1) STATEMENT

The Board acknowledges that there are a number of risks and uncertainties which could have From the perspective of the Manchester City Football Club Limited Board (‘the Board’), as a result
a material impact on the Club’s performance. The Club’s income is affected by the performance of the City Football Group (‘the Group’) governance structure, whereby the Board is embedded
of the first team because significant revenues are dependent upon strong team performances within the Group Board, the matters that it is responsible for considering under Section 172
in the Premier League, domestic and European Cup competitions. The Club is regulated by (1) of the Companies Act 2006 (‘s172’) have been considered to an appropriate extent by the
the rules of the FA, Premier League, UEFA, and FIFA and any change to these regulations could Group Board in relation both to the Group and to the Company. To the extent necessary for an
have an impact as the regulations cover areas such as: the distribution of broadcasting income, understanding of the development, performance, and position of the Company, an explanation
the eligibility of players, and the operation of the transfer market. The Club monitors its compliance of how the Group Board has considered the matters set out in s172, for the Group and for the
with all applicable rules and regulations on a continuous basis and considers the impact of any Company, is set out in the Group’s annual report. This does not form part of this report.
potential changes.
During the year ended 30 June 2021, the Club announced its intended participation and
The Board and management continue to monitor the COVID-19 situation. They are confident subsequent withdrawal from the European Super League. A settlement has been agreed with
that the Club has robust plans in place to ensure its financial security and future success. UEFA, including a one-off charitable donation and a five percent reduction of UEFA revenues
More consideration on the impact of COVID-19 is outlined in note 2. generated in the 2023-24 season. A further settlement has been agreed with the Premier League
and the FA, which will be reinvested into football related good causes. On 27 September 2021,
UEFA announced the payments relating to the settlement would be suspended whilst court
FUTURE DEVELOPMENTS proceedings are pending.
Manchester City will continually aim to be profitable in combination with on-pitch success By order of the Board
primarily in the Premier League and Champions League.
J MacBeath
Director
1 October 2021

Manchester City 2020-21 Annual Report 8

 DIRECTORS’
REPORT

Manchester City 2020-21 Annual Report 9

DIRECTORS’ REPORT

The Directors who held office during the year were as follows:

DIRECTORS
K Al Mubarak (Chairman)
M Edelman
S Pearce
J MacBeath
M Al Mazrouei
A Galassi
A Khouri

RESULT FOR THE YEAR DISABLED EMPLOYEES

The profit for the financial year was £2,367,000 (2020: £126,014,000 loss). Disabled employees are given full and fair consideration for all types of vacancy.
The Directors do not propose a dividend (2020: £nil). If an existing employee becomes disabled, practical and reasonable steps are taken
to retain them in employment. Where appropriate, assistance with rehabilitation
and suitable training are given. Disabled persons have equal opportunities for training,
EVENTS AFTER THE REPORTING DATE career development and promotion, except insofar as such opportunities are
constrained by the practical limitations of their disability.
Information about events after the balance sheet date can be found in note
25 to the financial statements.
FUTURE DEVELOPMENTS
POLITICAL AND CHARITABLE CONTRIBUTIONS Future developments are discussed in the Strategic Report.
The Company made no political contributions. Donations to UK charities
amounted to £3,789,474 (2020: £2,684,781). This amount includes £2.6m
supporting youth and community development via the Premier League.
FINANCIAL RISK MANAGEMENT
The Company’s principal financial instruments comprise cash and liquid resources
as well as various items such as trade and other receivables and trade and other
EMPLOYEE INVOLVEMENT payables that arise directly from its operations. The main purpose of the financial
instruments is to support the Company’s operations.
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 The main risks arising from the Company’s financial instruments are market risk,
of interest to them as employees. credit risk and liquidity risk. The Board oversees the management of these risks.

Manchester City 2020-21 Annual Report 10

DIRECTORS’ REPORT CONTINUED

STAKEHOLDER STATEMENTS
EMPLOYEES STREAMLINED ENERGY AND CARBON REPORTING
From the perspective of the Board, as a result of the Group governance structure, the Group The Company is exempt from the requirement to include Streamlined Energy and Carbon
Board has taken the lead in carrying out the duties of a Board in respect of the Company’s Reporting (‘SECR’) data due to this information being included in the Group report of the
employees, including engaging with them, having regard to their interests and the effect parent, City Football Group Limited. The Group report is prepared for the same financial
of that regard (including on the principal decisions taken by the Company during the year end as the Company and complies with the SECR disclosure requirements set out
financial year). The Board of the Company has also considered relevant matters where in Part 7A of Schedule 7 without relying on a “seriously prejudicial” exemption.
appropriate. An explanation of how the Group Board has carried out these responsibilities,
for the Group and for the Company, is set out in the Group’s annual report, which does not
form part of this report.

OTHER STAKEHOLDERS
Similarly, from the perspective of the Board, as a result of the Group governance structure,
the Group Board has taken the lead in carrying out the duties of a Board in respect of the
Company’s other stakeholders. The Board of the Company has also considered relevant
matters where appropriate. An explanation of how the Directors on the Group Board have
had regard to the need to foster the Company’s business relationships with suppliers,
customers and others, and the effect of that regard, including on the principal decisions
taken by the Company during the financial year, is set out, for the Group and for the
Company, in the Group’s annual report, which does not form part of this report.

Manchester City 2020-21 Annual Report 11

 STATEMENT
OF DIRECTORS’
RESPONSIBILITIES

Manchester City 2020-21 Annual Report 12

STATEMENT OF DIRECTORS’ RESPONSIBILITIES

DIRECTORS’ RESPONSIBILITIES AUDITORS

The Directors are responsible for preparing the Directors’ Report and the financial All of the current Directors have taken all the steps that they ought to have taken to make
statements in accordance with applicable law and regulations. themselves aware of any information needed by the Company’s Auditors for the purposes
of their audit and to establish that the Auditors are aware of that information. The Directors
Company law requires the Directors to prepare financial statements for each financial
are not aware of any relevant audit information of which the Auditors are unaware.
period. Under that law the Directors have elected to prepare the financial statements
in accordance with United Kingdom Generally Accepted Accounting Practice The auditor, BDO LLP, is deemed to be reappointed under section 487(2) of the Companies
(United Kingdom Accounting Standards and applicable law). Under company law Act 1985 which continues in force under the Companies Act 2006.
the Directors must not approve the financial statements unless they are satisfied that
By order of the Board
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. J MacBeath
Director
In preparing these financial statements, the Directors are required to:
1 October 2021
• select suitable accounting policies and then apply them consistently;
• make judgments and accounting estimates that are reasonable and prudent;
• s tate whether applicable UK Accounting Standards have been followed,
subject to any material departures disclosed and explained in the financial
statements; and
• p
 repare the financial statements on the going concern basis unless it
is inappropriate to presume that the Company will continue in business.
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.

Manchester City 2020-21 Annual Report 13

 INDEPENDENT AUDITORS’
REPORT TO THE MEMBERS
OF MANCHESTER CITY
FOOTBALL CLUB LIMITED

Manchester City 2020-21 Annual Report 14

INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS
OF MANCHESTER CITY FOOTBALL CLUB LIMITED

OPINION CONCLUSIONS RELATING TO GOING CONCERN

In our opinion, the financial statements: 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.
• g
 ive a true and fair view of the state of the Company’s affairs as at 30 June 2021
and of its profit for the year then ended; Based on the work we have performed, we have not identified any material uncertainties
• h
 ave been properly prepared in accordance with United Kingdom Generally Accepted relating to events or conditions that, individually or collectively, may cast significant doubt on
Accounting Practice; and the 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.
• have been prepared in accordance with the requirements of the Companies Act 2006.
Our responsibilities and the responsibilities of the Directors with respect to going concern
We have audited the financial statements of Manchester City Football Club Limited
are described in the relevant sections of this report.
(“the Company”) for the year ended 30 June 2021 which comprise the Statement of Profit
or Loss, Balance Sheet, statement of changes in equity and notes to the financial statements,
including a summary of significant accounting policies. The financial reporting framework OTHER INFORMATION
that has been applied in their preparation is applicable law and United Kingdom Accounting
Standards, including Financial Reporting Standard 101. The directors are responsible for the other information. The other information comprises the
information included in the Annual Report and Financial Statements, other than the financial
statements and our auditor’s report thereon. Our opinion on the financial statements does not
BASIS FOR OPINION 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
We conducted our audit in accordance with International Standards on Auditing (UK)
the other information and, in doing so, consider whether the other information is materially
(ISAs (UK)) and applicable law. Our responsibilities under those standards are further
inconsistent with the financial statements or our knowledge obtained in the course of the audit,
described in the Auditor’s responsibilities for the audit of the financial statements section
or otherwise appears to be materially misstated. If we identify such material inconsistencies
of our report. We believe that the audit evidence we have obtained is sufficient and
or apparent material misstatements, we are required to determine whether this gives rise to
appropriate to provide a basis for our opinion.
a material misstatement in the financial statements themselves. If, based on the work we
INDEPENDENCE
have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact.
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 We have nothing to report in this regard.
Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance
with these requirements.

Manchester City 2020-21 Annual Report 15

INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS
OF MANCHESTER CITY FOOTBALL CLUB LIMITED CONTINUED

OTHER COMPANIES ACT 2006 REPORTING AUDITORS’ RESPONSIBILITIES FOR THE AUDIT OF THE
In our opinion, based on the work undertaken in the course of the audit: FINANCIAL STATEMENTS
• the information given in the Strategic report and the Directors’ report for the financial Our objectives are to obtain reasonable assurance about whether the financial statements as
year for which the financial statements are prepared is consistent with the financial a whole are free from material misstatement, whether due to fraud or error, and to issue an
statements; and 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
• the Strategic report and Directors’ report have been prepared in accordance with a material misstatement when it exists. Misstatements can arise from fraud or error and are
applicable legal requirements. considered material if, individually or in the aggregate, they could reasonably be expected to
In the light of the knowledge and understanding of the Company and its environment influence the economic decisions of users taken on the basis of these financial statements.
obtained in the course of the audit, we have not identified material misstatements in
the Strategic report or the Directors’ report.
EXTENT TO WHICH THE AUDIT WAS CAPABLE OF DETECTING
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:
IRREGULARITIES, INCLUDING FRAUD
Irregularities, including fraud, are instances of non-compliance with laws and regulations.
• a
 dequate accounting records have not been kept, or returns adequate for our audit
We design procedures in line with our responsibilities, outlined above, to detect material
have not been received from branches not visited by us; or
misstatements in respect of irregularities, including fraud. The extent to which our procedures
• the financial statements are not in agreement with the accounting records and returns; or are capable of detecting irregularities, including fraud is detailed below.
• certain disclosures of Directors’ remuneration specified by law are not made; or Based on our understanding and accumulated knowledge of the Company and the sector
in which it operates we considered the risks of acts by the Company which were contrary to
• we have not received all the information and explanations we require for our audit.
applicable laws and regulations, including fraud, and whether such actions or non-compliance
might have a material effect on the financial statements. These included but are not limited
to those that relate to the form and content of the financial statements, such as accounting
RESPONSIBILITIES OF DIRECTORS policies, UK GAAP, the Companies Act 2006, relevant taxation legislation, Health and Safety
As explained more fully in the Statement of Directors’ Responsibilities the Directors are and the Bribery Act 2010.
responsible for the preparation of the financial statements and for being satisfied that they
We determined that the principle risk were related to inappropriate journals entries,
give a true and fair view, and for such internal control as the Directors determine is necessary
management bias in accounting estimates and revenue recognition. Our audit procedures
to enable the preparation of financial statements that are free from material misstatement,
included but were not limited to:
whether due to fraud or error.
• Agreement of the financial statement disclosures to underlying supporting documentation;
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 • C
 hallenging assumptions and judgements made by management in their significant
concern and using the going concern basis of accounting unless the Directors either intend to accounting estimates, in particular bad debt and legal provisions;
liquidate the Company or to cease operations, or have no realistic alternative but to do so.
• Identifying and testing journal entries, in particular journal entries posted with unusual
account combinations;

Manchester City 2020-21 Annual Report 16

INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS
OF MANCHESTER CITY FOOTBALL CLUB LIMITED CONTINUED

• T
 esting a sample of revenue transactions to signed contracts and other third party USE OF OUR REPORT
documentation to ensure they are recorded in the correct period;
This report is made solely to the Company’s members, as a body, in accordance with Chapter
• D
 iscussion held with management and those charged with governance, including 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might
consideration of known or suspected instances of non-compliance with laws and state to the Company’s members those matters we are required to state to them in an auditor’s
regulations and fraud; report and for no other purpose. To the fullest extent permitted by law, we do not accept or
• R
 eview of minutes of board meetings from throughout the year as well as a review assume responsibility to anyone other than the Company and the Company’s members as a
of internal audit reports; body, for our audit work, for this report, or for the opinions we have formed.

• O
 btaining an understanding of the control environment in monitoring compliance
with laws and regulations Stuart Wood (Senior Statutory Auditor)
For and on behalf of BDO LLP, Statutory Auditor
Our audit procedures were designed to respond to risks of material misstatement in the
financial statements, recognising that the risk of not detecting a material misstatement due Manchester, United Kingdom
to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve 1 October 2021
deliberate concealment by, for example, forgery, misrepresentations or through collusion. BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
There are inherent limitations in the audit procedures performed and the further removed
non-compliance with laws and regulations is from the events and transactions reflected in
the financial statements, the less likely we are to become aware of it.
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 auditors’ report.

Manchester City 2020-21 Annual Report 17

 STATEMENT OF
PROFIT OR LOSS

Manchester City 2020-21 Annual Report 18

STATEMENT OF PROFIT OR LOSS FOR THE YEAR ENDED 30 JUNE 2021

Operations
excluding Player trading
player trading and amortisation Total Total
2021 2021 2021 2020
Note £000 £000 £000 £000

Revenue 4 569,849 – 569,849 478,359

Other operating income 5 1,244 – 1,244 3,239
Operating expenses 5 (484,140) (145,697) (629,837) (641,179)

Operating profit/(loss) 86,953 (145,697) (58,744) (159,581)

Profit on disposal of players’ registrations – 68,545 68,545 39,803

Profit/(loss) before interest and taxation 86,953 (77,152) 9,801 (119,778)

Interest receivable and similar income 8 1,525 – 1,525 17
Interest payable and similar charges 9 (6,278) – (6,278) (5,359)

Profit/(loss) on ordinary activities before taxation 82,200 (77,152) 5,048 (125,120)

Taxation 10 (2,681) – (2,681) (894)
Profit/(loss) on ordinary activities after taxation 79,519 (77,152) 2,367 (126,014)

The results for the period are from continuing operations. The Company does not have any
other comprehensive income.
The notes on pages 24 to 48 form part of these financial statements.

Manchester City 2020-21 Annual Report 19

 BALANCE
SHEET

Manchester City 2020-21 Annual Report 20

BALANCE SHEET AS AT 30 JUNE 2021

Registered number 00040946

2021 2020
Note £000 £000
Non-current assets
Intangible assets 11 452,267 448,632
Property, plant and equipment 12 312,457 315,814
Right of use assets 13 81,416 82,868
Investments 14 – –
Trade and other receivables 15 7,203 14,310
853,343 861,624

Current assets
Trade and other receivables 15 279,491 220,143
Cash at bank and in hand 45,135 17,838
324,626 237,981

Current liabilities
Trade and other payables 16 (196,900) (229,829)
Deferred income 19 (196,095) (152,983)
Net current liabilities (68,369) (144,831)
Total assets less current liabilities 784,974 716,793

Non-current liabilities
Trade and other payables 17 (117,500) (77,596)
Deferred tax liabilities 20 (11,171) (8,490)
Net assets 656,303 630,707

Equity
Called up share capital 21 1,339,575 1,316,346
Share premium account 45,008 45,008
Retained earnings (728,280) (730,647)
Total equity 656,303 630,707

The notes on pages 24 to 48 form part of these financial statements. These financial statements were approved by the Board of Directors
on 1 October 2021 and were signed on its behalf by:
J MacBeath
Director

Manchester City 2020-21 Annual Report 21

 STATEMENT OF
CHANGES IN EQUITY

Manchester City 2020-21 Annual Report 22

STATEMENT OF CHANGES IN EQUITY
Share Share Retained
capital premium earnings Total
£000 £000 £000 £000

As at 1 July 2019 1,316,346 45,008 (604,633) 756,721

Loss for the year – – (126,014) (126,014)

As at 30 June 2020 1,316,346 45,008 (730,647) 630,707

Shares issued in the year 23,229 – – 23,229
Profit for the year – – 2,367 2,367
As at 30 June 2021 1,339,575 45,008 (728,280) 656,303

The notes on pages 24 to 48 form part of these financial statements.

Manchester City 2020-21 Annual Report 23

 NOTES TO
THE FINANCIAL
STATEMENTS

Manchester City 2020-21 Annual Report 24

NOTES TO THE FINANCIAL STATEMENTS

1. GENERAL INFORMATION
The financial statements of Manchester City Football Club Limited (‘the Company’ or ‘the Club’) • T
 he requirements of paragraphs 130(fii), 130(fiii), 134(d)-(f) and 135(c)-(e) of IAS 36
for the year ended 30 June 2021 were authorised for issue by the Board of Directors and the Impairment of assets;
balance sheet was signed on the Board’s behalf by J MacBeath. Manchester City Football Club
• T
 he requirements of the second sentence of paragraph 110 and paragraphs 113(a),
Limited is a private company limited by share capital incorporated and domiciled in England and
114, 115, 118, 119(a)-(c), 120-127 and 129 of IFRS 15 Revenue from Contracts with
Wales under the Companies Act 2006. The registered office is Etihad Stadium, Etihad Campus,
Customers; and
Manchester M11 3FF. The principal activity of the Company is discussed in the Strategic Report.
• T
 he requirements of paragraphs 52, 58, the second sentence of paragraph 89,
and paragraphs 90, 91 and 93 of IFRS 16 Leases.
2. SIGNIFICANT ACCOUNTING POLICIES
The principal accounting policies applied in the preparation of these financial statements are These financial statements are presented in pounds sterling and all values are rounded
set out below. These policies have been consistently applied to all of the years presented. to the nearest thousand except when otherwise stated.

BASIS OF PREPARATION GOING CONCERN

The Company meets the definition of a qualifying entity under FRS 100 issued by the City Football Group (‘the Group’), of which the Company is a subsidiary, has prepared a detailed
Financial Reporting Council (‘FRC’). The Company financial statements have therefore cash flow forecast which shows that it is able to operate and meet its liabilities as they fall
been prepared in accordance with FRS 101 and with those parts of the Companies due for payment for at least 12 months from the date of approval of these financial statements.
Act 2006 applicable to companies reporting under FRS 101. The Company has taken COVID-19 presents a unique and constantly changing challenge and the ongoing impact of the
advantage of the following disclosure exemptions under FRS 101: pandemic was considered as part of this forecasting.
• T
 he requirements of paragraph 62, B64(d), B64(e), B64(g), B64(h), B64(j)-B64(m), The Group considered multiple scenarios and performed stress-tests to the cash flow forecast,
B64(n)(ii), B64(o)(ii), B64(p), B64(q)(ii), B66 and B67 of IFRS 3 (R) Business combinations; including fixtures remaining behind closed doors for the entirety of the 2021-22 season and
• The requirement of IFRS 7 Financial instruments: disclosures; restrictions on future revenue generating events.

• The requirements of paragraphs 91-99 of IFRS 13 Fair value measurement; Following this assessment, the Directors reasonably expect the Group and Company will
continue in existence for a period of at least 12 months from the date these financial statements
• The requirements of IAS 7 Statement of cash flows; are approved. City Football Group Limited has signed a letter of financial support for the
• T
 he requirements of paragraphs 30 and 31 of IAS 8 Accounting policies, changes in Company. Accordingly, the financial statements have been prepared on a going concern basis.
accounting estimates and errors; In July 2021, the Group completed a $650m term loan and secured a £80m revolving credit
• The requirements of paragraph 17 and 18A of IAS 24 Related party disclosures; facility, which further strengthens the working capital of the Group. Both facilities are not due
for repayment until June 2028.
• T
 he requirement in paragraph 38 of IAS 1 Presentation of financial statements to present
comparative information in respect of: (i) paragraph 79(a) (iv) of IAS 1; (ii) paragraph 73(e)
of IAS 16 Property, plant and equipment; (iii) paragraph 118(e) of IAS 38 Intangible assets;
• T
 he requirements of paragraphs 10(d), 10(f), 16, 40(a)-(d), 111 and 134-136 of IAS 1
Presentation of Financial Statements;
• T
 he requirements in IAS 24 Related party disclosures to disclose related party transactions
entered into between two or more members of City Football Group Limited, provided that
any subsidiary which is a party to the transaction is wholly owned by such a member;

Manchester City 2020-21 Annual Report 25

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS TRANSACTIONS AND BALANCES

No standards have been adopted mandatorily for the first time, or adopted early, Transactions in foreign currencies are recorded using the rate of exchange ruling at the date
by the Company. of the transaction.

NEW AND AMENDED STANDARDS AND INTERPRETATIONS ISSUED BUT NOT YET EFFECTIVE Monetary assets and liabilities denominated in foreign currencies are translated using the
contracted rate or the rate of exchange ruling at the reporting date. All differences are taken
• A
 mendments to IFRS 3 Business Combinations (mandatory for the first time for financial to the profit or loss account. Tax charges and credits attributable to exchange differences
year beginning 1 July 2022); on those monetary items are also recorded in profit or loss.
• A
 mendments to IAS 16 Property, Plant and Equipment (mandatory for the first time
for financial year beginning 1 July 2022); Non-monetary items that are measured at historical cost in a foreign currency are translated
using the exchange rates as at the dates of the initial transactions. Non-monetary items
• A
 mendments to IAS 37 Provisions, Contingent Liabilities and Contingent Assets measured at fair value in a foreign currency are translated using the exchange rates at the
(mandatory for the first time for financial year beginning 1 July 2022); date when the fair value is determined.
• A
 nnual Improvements to IFRS 1 First time adoption of IFRS (mandatory for the first time
for financial year beginning 1 July 2022); The gain or loss arising on translation of non-monetary items is recognised with the gain
or loss of the item that gave rise to the translation difference.
• A
 nnual Improvements to IFRS 9 Financial Instruments (mandatory for the first time
for financial year beginning 1 July 2022); REVENUE
• A
 nnual Improvements to Illustrative Examples accompanying IFRS 16 Leases Revenue represents the fair value of considerations received or receivable from the Company’s
(mandatory for the first time for financial year beginning 1 July 2022); and principal activities, excluding VAT, other sales taxes and transfer fees. The Company’s principal
• A
 nnual Improvements to IAS 41 Agriculture (mandatory for the first time for financial revenue streams are matchday income, TV broadcasting income, and commercial activities
year beginning 1 July 2022). relating to the Company. The Company recognises revenue based on the fair value of each
performance obligation within a contract, once the obligations have been extinguished, for
BASIS OF CONSOLIDATION each of the principal activities which are separated by category of revenue described below.
The financial statements contain information about Manchester City Football Club Limited The performance obligations of Manchester City are directly related to the typical payment
as an individual company and do not contain consolidated financial information as the terms of customers.
parent of a group. The Company is exempt under section 400 of the Companies Act 2006
from the requirement to prepare consolidated financial statements as it and its subsidiary
Matchday
undertakings are included by full consolidation in the consolidated financial statements
of City Football Group Limited, a company registered in England and Wales. Matchday revenue is based on men’s football matches played by the Club throughout the year.
Revenue from each match is recognised only after each match is played throughout the year.
FOREIGN CURRENCY TRANSLATION General admission tickets for a matchday are refunded up to seven days prior to the event.
The Company’s financial statements are presented in pounds sterling, which is also the Matchday revenue includes revenue generated from Manchester City Football Club domestic
Company’s functional currency, which is the currency of the primary economic environment and European matchday activities played at the Etihad Stadium in Manchester, together with
in which the Company operates. the Company’s share of gate receipts from domestic cup matches not played at the Etihad
Stadium and revenue generated from pre-season tours. The share of gate receipts payable
to the opposition club and competition organiser for domestic cup matches held at the Etihad
Stadium is recognised as an operating expense once the match has been played.

Manchester City 2020-21 Annual Report 26

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

Matchday revenue received in advance of the year end, relating to the following year is Other operating income
treated as deferred income until such time that the related match is played when the Income from the Elite Player Performance Plan (‘EPPP’) being a youth development
revenue is recognised. Deferred matchday revenue mainly relates to seasonal facilities scheme initiated by the Premier League is recognised in the financial year for the season
at the Etihad Stadium. to which it relates.
The Company recognises, under IFRS 15, the net revenue generated from the catering
contract as royalty income as Manchester City Football Club are acting as the agent. Accrued and deferred income
Revenue relating to matchday, TV broadcasting and other commercial activities received
TV broadcasting after the financial year end to which it relates is accrued as earned.
TV broadcasting income represents revenue generated from all UK and overseas media Revenue relating to matchday, TV broadcasting and other commercial activities receivable
contracts, including contracts negotiated on behalf of participating clubs by the Premier prior to the year end in respect of seasons in future financial years is deferred.
League and UEFA.
Revenue from the Premier League in respect of TV broadcasting for each football season TAXES
is recognised in line with games played. The fixed element of revenue received from the Current income tax
Premier League is recognised as home games are played in the season. Facility fees for live Current income tax assets and liabilities for the current period are measured at the amount
coverage, near live coverage and highlights are earned for home and away matches and expected to be recovered from or paid to the taxation authorities. The tax rates and tax laws
recognised following the completion of each match. used to compute the amount are those that are enacted or substantively enacted at the
UEFA distributions from participation in the UEFA Champions League include market pool reporting date in the countries where the Company operates and generates taxable income.
payments recognised over the matches played and fixed amounts for participation in individual Current income tax relating to items recognised directly in other comprehensive income (‘OCI’)
matches recognised when matches are played. Distributions relating to team performance is recognised in OCI and not in profit or loss. Management periodically evaluates positions taken
represent variable consideration and are recognised using the most likely amount method based in the tax returns with respect to situations in which applicable tax regulations are subject to
on management’s estimate of where the men’s first team will finish at the end of the season. interpretation and establishes provisions where appropriate.
Fines and penalties that are in relation to performance obligations and are not in respect of
the purchase of a distinct good or service are treated as variable revenue. Deferred tax
Deferred tax is provided using the liability method on temporary differences at the reporting
Other commercial date between the tax bases of assets and liabilities and their carrying amounts for financial
Other commercial revenue includes revenue derived from the Manchester City brand reporting purposes.
through partnership and other commercial contracts. Revenue from related activities such Deferred tax liabilities are generally recognised for all taxable temporary differences and
as concerts, conferences and events is recognised following the completion of the event. deferred tax assets are recognised only to the extent that it is probable that taxable profit
Revenue receivable in advance of the event is deferred until its completion when it is will be available against which deductible timing differences can be utilised.
recognised as revenue. Revenue receivable in relation to partnership contracts over and Deferred tax assets and liabilities are measured at the tax rates that are expected to apply
above the minimum guaranteed revenue within the contract is recognised as revenue when in the year when the asset is realised or the liability is settled, based on tax rates (and tax laws)
each performance obligation within a contract has been extinguished. Revenue receivable that have been enacted or substantively enacted at the reporting date.
from partners in relation to bonuses for the success of the first team in certain competitions
represent variable consideration which is estimated at the contract inception using the most
likely amount method based on management’s estimate of where the first team will finish at
the end of each season. Revenue is recognised over the term of the contract in line with
the partnership benefits enjoyed by each partner.

Manchester City 2020-21 Annual Report 27

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

Deferred tax items are recognised in correlation to the underlying transaction either in the PROPERTY, PLANT AND EQUIPMENT
profit or loss account or in other comprehensive income. Property, plant and equipment is stated at cost, net of accumulated depreciation and accumulated
Deferred tax assets and deferred tax liabilities are offset if a legally enforceable right exists impairment losses, if any. Such cost comprises purchase price and any directly attributable
to set off current tax assets against current income tax liabilities and the deferred taxes costs. When significant parts of property, plant and equipment are required to be replaced at
relate to the same taxable entity and the same taxation authority. intervals, the Company derecognises the replaced part, and recognises the new part with its own
associated useful life and depreciation.
VAT and other sales taxes Likewise, when a major inspection is performed, its cost is recognised in the carrying amount of
Revenue, expenses and assets are recognised net of the amount of VAT or other sales tax, the plant and equipment as a replacement if the recognition criteria are satisfied. All other repair
except where the VAT or sales tax incurred on a purchase of assets or services is not and maintenance costs are recognised in the profit or loss account as incurred.
recoverable from the taxation authority, in which case the VAT or sales tax is recognised Assets are reviewed for impairment whenever events or changes in circumstances indicate that
as part of the cost of acquisition of the asset or as part of the expense item as applicable. the carrying amount may not be recoverable. Any impairment charges are recognised in the profit
The net amount of VAT or sales tax recoverable from, or payable to, the taxation authority or loss account when the carrying amount of the asset exceeds its estimated recoverable value,
is included as part of receivables or payables in the balance sheet. being the higher of the asset’s fair value less cost to sell and value in use. These amounts are
calculated with reference to future discounted cash flows that the asset is expected to generate
LEASES when considered as part of a cash-generating unit (‘CGU’).
IFRS 16 was adopted from 1 July 2019 using a modified retrospective transition approach. Property, plant and equipment and any significant part initially recognised is derecognised upon
The main impact of IFRS 16 for the Company was the recognition of all future lease liabilities disposal or when no future economic benefits are expected from its use or disposal. Any gain or
on the balance sheet. Corresponding right of use assets have also been recognised on the loss arising on derecognition of the asset (calculated as the difference between the net disposal
balance sheet representing the economic benefits of the Company’s right to use the underlying proceeds and the carrying amount of the asset) is included in the profit or loss account when the
leased assets. asset is derecognised.

The weighted average incremental borrowing rate applied to lease liabilities where no rate The assets’ residual values, useful lives and methods of depreciation are reviewed at each financial
is included in the lease contract is 5.07%. year end and adjusted prospectively, if appropriate.

For any new contracts entered into, the Company considers whether a contract is or contains Land is not depreciated. Depreciation on other assets is provided on a straight-line basis to write
a lease. A lease is defined as a contract that conveys the right to use of an asset for a period down assets to their estimated residual value over their estimated useful economic lives from the
of time in exchange for consideration. To apply this definition, the Company assesses whether date of acquisition by the Company as follows:
the contract meets three key evaluations: Freehold buildings: 50 years straight-line
• the contract contains an identified asset, which is either explicitly identified in Long leasehold buildings: estimated useful economic life of the asset
the contract or implicitly specified by being identified at the time the asset is made Short leasehold buildings: estimated useful economic life of the asset
available to the Company;
Fixtures and fittings: 4-10 years straight-line
• the Company has the right to obtain substantially all of the economic benefits from
Computer equipment: 4 years straight-line
use of the identified asset throughout the period of use, considering its rights within
the defined scope of the contract; and
• the Company has the right to direct the use of the identified asset throughout
the period of use.

Manchester City 2020-21 Annual Report 28

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

INTANGIBLE ASSETS Renegotiation

Intangible assets acquired separately are measured on initial recognition at cost. The cost of The costs associated with an extension of a playing contract are added to the residual balance
intangible assets acquired in a business combination is their fair value as at the date of acquisition. of the players’ registrations at the date of signing the contract extension. The revised net book
Following initial recognition, intangible assets are carried at cost less accumulated amortisation value is amortised over the remaining renegotiated contract length.
and accumulated impairment losses, if any.
The useful lives of intangible assets are assessed as either finite or indefinite. Impairment
Management believe the value in use of a player’s registration cannot be determined on a
Intangible assets with finite lives are amortised over their useful economic lives and assessed player by player basis unless certain circumstances arise, such as a player suffering a career
for impairment whenever there is an indication that the intangible asset may be impaired. threatening injury or a player is no longer deemed to be part of the first team. If such an
The amortisation period and the amortisation method for an intangible asset with a finite useful event were to arise, management would assess the registration’s fair value less cost-to-sell
life are reviewed at least at the end of each reporting period. Changes in the expected useful in comparison to its carrying value. Where the estimated fair value less cost-to-sell of a single
life or the expected pattern of consumption of future economic benefits embodied in the asset player’s registration was below its carrying value, management would record an impairment
is accounted for by changing the amortisation period or method, as appropriate, and are treated charge in profit or loss immediately.
as changes in accounting estimates. The amortisation expense on intangible assets with finite
lives is recognised in profit or loss in the expense category consistent with the function of the Disposal
intangible assets.
Players’ registrations available for sale are classified as assets held for sale when their carrying
Intangible assets with indefinite useful lives are not amortised, but are tested for impairment value is expected to be recovered principally through sale rather than continued use and a sale
annually, either individually or at the CGU level. The assessment of indefinite life is reviewed is considered highly probable. For sale to be highly probable, management must have committed
annually to determine whether the indefinite life continues to be supportable. If not, the change to sell the registration, it must be actively marketed by the Company, with offers being received
in useful life from indefinite to finite is made on a prospective basis. prior to the year end. For a registration to be classified as held for sale, management should
Gains or losses arising from derecognition of an intangible asset are measured as the difference expect to sell the asset within 12 months of the date of reclassification. These assets would
between the net disposal proceeds and the carrying amount of the asset and are recognised be reclassified as current assets and stated at the lower of their carrying value and their fair
in profit or loss when the asset is derecognised. value less cost to sell with any impairment loss being recognised in profit or loss at the date
of reclassification.
PLAYERS’ REGISTRATIONS AND FOOTBALL STAFF REMUNERATION When a player’s registration sale is completed, the fair value of consideration receivable less
Initial recognition any applicable transaction costs, is assessed against the registration’s carrying value. Where the
Players’ registrations costs including transfer fees, associated agent fees, Premier League amounts are different, gains and losses arising as a result of the sale are recorded and disclosed
levy fees and other directly attributable costs are initially recognised at the fair value of separately within profit or loss on players’ registrations in the profit or loss account. Contingent
the consideration payable for the acquisition. When a player’s registration is acquired, consideration receivable from a sale of the players’ registrations is only recognised in the profit
management will make an assessment to estimate the likely outcome of specific performance or loss account once the performance conditions within the contract are met.
conditions. Contingent consideration will be recognised in the players’ registrations costs
when management believes the performance conditions are met in line with the contractual Remuneration
terms. Periodic reassessments of the contingent consideration are completed. Any contingent Player remuneration is recorded in operating expenses in line with the conditions of the individual
amounts that management believe will be payable are included in the players’ registrations contracts. Performance bonuses are recorded as they become legally or contractually payable
from the date management believe the performance conditions are met. Any additional on a player by player basis. Loyalty and signing on fees payable are recorded in the profit or loss
amounts of contingent consideration not included in the costs of players’ registrations are account in the period to which they relate.
disclosed separately as a commitment. Amortisation of costs is on a straight-line basis over
the length of the players’ contract.

Manchester City 2020-21 Annual Report 29

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

INVESTMENTS Impairment of financial assets

The Company reviews each of its investments to assess whether control or significant The Company recognises an allowance for expected credit losses (‘ECLs’) for all debt
influence exists. When the Company concludes that it has control of an investment, the instruments not held at fair value through profit or loss. ECLs are based on the difference
investment is treated as a subsidiary. If control or joint control does not exist, the Company between the contractual cash flows due in accordance with the contract and all the cash
assesses the investment for significant influence. When significant influence does not exist, flows that the Company expects to receive, discounted at an approximation of the original
the investment is treated as a financial investment by the Company. effective interest rate.
Other investments held are stated at cost less any provision for impairment. ECLs are recognised in two stages. For credit exposures for which there has not been
a significant increase in credit risk since initial recognition, ECLs are provided for credit losses
FINANCIAL INSTRUMENTS that result from default events that are possible within the next 12-months (a 12-month ECL).
A financial instrument is any contract that gives rise to a financial asset of one entity For those credit exposures for which there has been a significant increase in credit risk since
and a financial liability or equity instrument of another entity. initial recognition, a loss allowance is required for credit losses expected over the remaining
life of the exposure, irrespective of the timing of the default (a lifetime ECL).
FINANCIAL ASSETS
Initial recognition and measurement Derivative financial instruments
Financial assets are classified, at initial recognition, as amortised cost, financial assets Derivatives are initially recognised at fair value on the date of inception and subsequently
at fair value through profit or loss or fair value through other comprehensive income measured at fair value at the end of each period. Subsequent changes in fair value are
financial assets. All financial assets are recognised initially at fair value. recognised depending on whether the derivative is designated as a hedging instrument
and, if so, the nature of the item being hedged.
Subsequent measurement The full fair value of the derivative is classified as a non-current asset or liability when the
For purposes of subsequent measurement, financial assets are classified in two categories: remaining maturity of the hedged item is more than 12 months and as a current asset or
• Financial assets at fair value through profit or loss; and liability if the remaining maturity of the hedged item is less than 12 months.
• Financial assets classified as amortised cost. Any gains or losses arising from changes in the fair value of derivatives are taken directly to
profit or loss, except for the effective portion of cash flow hedges, which is recognised in other
Financial assets at fair value through profit or loss comprehensive income and later reclassified to profit or loss when the hedge item affects profit
Financial assets at fair value through profit or loss include financial assets held for trading or loss. Amounts recognised in other comprehensive income and accumulated in equity are
and financial assets designated upon initial recognition at fair value through profit or loss. reclassified to profit or loss in the periods when the hedged item is recognised in profit or loss.
Derivatives, including separated embedded derivatives, are classified as fair value through
profit or loss. Financial assets at fair value through profit or loss are carried in the balance Trade and other receivables
sheet at fair value with net changes in fair value presented as interest payable and similar Trade and other receivables are recognised initially at fair value and subsequently measured at
charges (negative net changes in fair value) or interest receivable and similar income amortised cost using the effective interest method, less provision for impairment. If collection is
(positive net changes in fair value) in profit or loss. expected in greater than one year, the receivables are presented as non-current assets. If the
receivables are expected to be collected in one year or less, they are presented as current assets.
Financial assets classified as amortised cost
For trade receivables, the Company applies a simplified approach in calculating ECLs.
The asset is measured at the amount recognised at initial recognition minus principal Therefore, the Company does not track changes in credit risk, but instead recognises a loss
repayments, plus or minus the cumulative amortisation of any difference between that initial allowance based on lifetime ECLs at each reporting date. The Company has established a
amount and the maturity amount, and any loss allowance. Interest income is calculated provision matrix that is based on its historical credit loss experience, adjusted for forward-looking
using the effective interest method (‘EIR’) and is recognised in profit or loss. Changes in factors specific to the receivables and the economic environment.
fair value are recognised in profit or loss when the asset is derecognised or reclassified.

Manchester City 2020-21 Annual Report 30

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

Cash at bank and in hand 3. SIGNIFICANT ACCOUNTING JUDGMENTS,

Cash at bank and in hand in the balance sheet comprise cash at banks and in hand as well ESTIMATES AND ASSUMPTIONS
as short-term deposits with a maturity of three months or less.
The preparation of the Company’s financial statements requires management to make
Trade and other payables judgments, estimates and assumptions that affect the reported amounts of revenue,
expenses, assets and liabilities, and the disclosure of contingent liabilities, at the end
Trade and other payables are obligations to pay for goods and services which have been
of the reporting period. However, uncertainty about these assumptions and estimates
acquired in the commercial operations of the Company. Amounts payable are presented
could result in outcomes that require a material adjustment to the carrying amount of
as non-current liabilities if payment is due in greater than one year. Where amounts payable
the asset or liability affected in future periods. Estimates and assumptions used by
are due in one year or less, they are presented as current liabilities.
management are based on historical experience and other relevant factors.
Trade and other payables are recognised initially at fair value and subsequently measured
at amortised cost using the effective interest method. PLAYERS’ REGISTRATIONS
The costs associated with players’ registrations are initially recognised at the fair value
Other loans of the consideration payable for the acquisition. When a player’s registration is acquired,
Other loans are recognised initially at fair value and subsequently measured at amortised cost management will make an assessment to estimate the likely outcome of specific
using the effective interest method. performance conditions. Contingent consideration will be recognised in the players’
registrations costs when management believes the performance conditions are met
Pension costs in line with the contractual terms. Subsequent reassessments of the contingent
consideration payable are included in the players’ registrations. The estimate of the
The Company is one of a number of participating employers of The Football League Limited
amount of contingent consideration payable requires management to assess, on a
Pension and Life Assurance Scheme which has been closed for new employees. The Company
player by player basis, when it is deemed that the specific performance terms are met.
is unable to identify its share of the assets and liabilities of the scheme. As such, the Company’s
contributions into the scheme are recognised in profit or loss when they fall due. Management will perform an impairment review of player’s registrations, if events indicate
that the carrying value is not recoverable through an inflow of future economic benefits.
The Company also operates a defined contribution scheme. The assets of the scheme are held
Whilst management do not feel it is appropriate to separate an individual player’s
separately from those of the Company in an independently administered fund. The Company’s
registration from a single cash-generating unit (‘CGU’), being the operations of the club
contributions into this scheme are recognised in profit or loss when they fall due.
in possession of the registration, there may be limited circumstances in which a registration
is removed from the CGU and recoverability assessed separately. Where such indications
exist, management will compare the carrying value of the asset with management’s best
estimate of fair value less cost to sell.

FINANCIAL INSTRUMENTS
Financial instruments due to be settled or received in greater than one year are discounted
when the time value of money is considered by management to be material to the Company.
In such instances, management will estimate the timing of future cash flows and select an
appropriate discount rate in order to calculate the present value of future cash flows related
to the financial instrument.

Manchester City 2020-21 Annual Report 31

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

4. REVENUE

2021 2020
£000 £000

Matchday 732 41,694

Broadcasting - UEFA 114,765 67,261
Broadcasting - all other 182,683 123,063
Other commercial activities 271,669 246,341
Total 569,849 478,359

All revenue originates in the United Kingdom. The principal activity of the Company External revenue can be analysed into three main components, with broadcasting
is the operation of a professional football club. analysed further into revenue arising from UEFA competitions and all other
broadcasting revenue.
A breakdown of revenue has been provided above. All of the results for the above
activities are included within the primary statements.

Manchester City 2020-21 Annual Report 32

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

5. OPERATING LOSS

2021 2020
£000 £000
Other operating income
Other operating income 1,224 3,239
Total 1,224 3,239

Operating expenses
Direct cost of sales and consumables 67 6,136
Remuneration of Auditors (audit fees) 60 48
Other external charges 99,766 123,844
Employee costs (Note 7) 354,689 351,412
Amortisation and impairment of intangible assets (Note 11) 164,427 146,285
Profit on disposal of property, plant and equipment – 1,331
Depreciation of property, plant and equipment:
Owned (Note 12) 9,376 10,671
Leased (Note 13) 1,452 1,452
Total 629,837 641,179

Operating loss
Operating profit/(loss) before player trading 86,953 (13,761)
Amortisation of players’ registrations (145,697) (145,820)
Total (58,744) (159,581)

Manchester City 2020-21 Annual Report 33

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

6. DIRECTORS’ REMUNERATION
No Directors were paid in the period (2020: £nil) and no company pension contributions were made (2020: £nil).

7. EMPLOYEES
The average number of employees and Directors during the period is set out and analysed by category in the table below:
2021 2020
Average number of employees
Football staff – including players 245 214
Commercial/administration staff 264 263
Total 509 477

The aggregate payroll costs of these persons were as follows:

2021 2020
£000 £000

Wages and salaries 310,737 307,278

Social security costs 42,502 42,938
Other pension costs 1,450 1,196
Total 354,689 351,412

Manchester City 2020-21 Annual Report 34

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

8. I NTEREST RECEIVABLE AND SIMILAR INCOME

2021 2020
£000 £000

Bank interest – 17
Other 1,525 –
Total 1,525 17

9. INTEREST PAYABLE AND SIMILAR CHARGES

2021 2020
£000 £000

Bank loans and overdrafts 1,155 838

Interest expense on leases 5,123 4,521
Total 6,278 5,359

Manchester City 2020-21 Annual Report 35

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

10. TAXATION
(A) ANALYSIS OF THE TAX CHARGE IN THE PERIOD
2021 2020
£000 £000
Current tax

UK corporation tax at 19% (2020: 19%) on profits for the period – –

Total current tax charge – –
Deferred tax
Impact of change in UK corporation tax rate 2,681 894
Total deferred tax charge 2,681 894
Total tax charge 2,681 894

Manchester City 2020-21 Annual Report 36

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

(B) FACTORS AFFECTING TAX CHARGE FOR THE YEAR

The tax charge for the period varies from the standard rate of corporation
tax in the UK of 19% (2020: 19%). The differences are explained below.
2021 2020
£000 £000

Profit/(loss) on ordinary activities before taxation 5,048 (125,120)

Profit/(loss) on ordinary activities multiplied by standard rate

of corporation tax in the UK of 19% (2020: 19%) 959 (23,773)
Effects of:
Expenses not deductible for tax purposes 388 1,914
Property, plant and equipment timing differences 1,374 2,143
Other permanent differences 586 511
Deferred tax not recognised (3,212) 19,296
Tax rate difference arising on revaluation of stadium 2,681 894
Income not taxable for tax purposes (95) (91)
Total tax charge for the period 2,681 894

The Company has corporation tax losses available for carry forward of approximately
£568.0m (2020: £568.0m).

(C) FACTORS THAT MAY AFFECT FUTURE TAX CHARGES

The Company expects its effective tax rate in future years to be less than On 3 March 2021, the UK Government announced that the UK corporation tax rate
the standard rate of corporation tax in the UK due principally to the amount would increase from 1 April 2023 from 19% to 25%. This was substantively enacted
of tax losses available to be set off against future taxable profits. on 11 March 2021.

Manchester City 2020-21 Annual Report 37

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

11. INTANGIBLE FIXED ASSETS

Other Players’
intangibles registrations Total
£000 £000 £000
Cost
As at 1 July 2020 3,392 977,669 981,061
Additions – 193,728 193,728
Disposals – (196,339) (196,339)
As at 30 June 2021 3,392 975,058 978,450

Amortisation
As at 1 July 2020 3,338 529,091 532,429
Charge in the year 56 145,697 145,753
Disposals (2) (170,671) (170,673)
Impairment – 18,674 18,674
As at 30 June 2021 3,392 522,791 526,183

Net book value

As at 30 June 2021 – 452,267 452,267
As at 30 June 2020 54 448,578 448,632

An impairment charge of £18.7m has been recognised based on an assessment of

first team players that are not expected to be a member of the first team playing squad.

Manchester City 2020-21 Annual Report 38

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

12. PROPERTY, PLANT AND EQUIPMENT

Land and Assets under Fixtures,
buildings Short leasehold Long leasehold the course of fittings and
(freehold) improvements improvements construction equipment Total
£000 £000 £000 £000 £000 £000
Cost
As at 1 July 2020 193,091 1,594 119,295 3,020 69,459 386,459
Additions 421 – – 1,706 3,892 6,019
Reclassification 785 – – (1,346) 561 –
As at 30 June 2021 194,297 1,594 119,295 3,380 73,912 392,478

Depreciation
As at 1 July 2020 13,925 233 14,431 – 42,056 70,645
Charge for the year 3,056 21 1,484 – 4,815 9,376
As at 30 June 2021 16,981 254 15,915 – 46,871 80,021

Net book value

As at 30 June 2021 177,316 1,340 103,380 3,380 27,041 312,457
As at 30 June 2020 179,166 1,361 104,864 3,020 27,403 315,814

ETIHAD STADIUM
On 5 August 2003, Maine Road was exchanged for a 250-year leasehold interest in
the Etihad Stadium. Rental payments are made quarterly. The lease has historically been
treated as a finance lease, with the lease premium and the net present value of future rental
obligations capitalised. As per IFRS 16, the asset is included within right of use assets.

Manchester City 2020-21 Annual Report 39

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

13. RIGHT OF USE ASSETS

Land and
buildings
£000
Cost
As at 1 July 2020 90,248
Additions –
As at 30 June 2021 90,248

Depreciation
As at 1 July 2020 7,380
Charge in the year 1,452
As at 30 June 2021 8,832

Net book value

As at 30 June 2021 81,416
As at 1 July 2020 82,868

Manchester City 2020-21 Annual Report 40

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

14. FIXED ASSET INVESTMENTS

Shares in
subsidiary
undertakings
£000

Net book value at 30 June 2021 –

Net book value at 30 June 2020 –

Proportion of voting
Subsidiary and associate Principal rights and share Registered
undertakings activities capital held address

City Football HQ, 400 Ashton New Road,

Manchester City Investments Limited Dormant company 100%
Manchester M11 4TQ
Town Hall, Albert Square,
Eastlands Strategic Development Company Limited Dormant company 33%
Manchester M60 2LA

Incorporated in England and Wales.

During the year, the Company committed to a €2 million investment in the European Super League Company, SL.
This was fully impaired during the year and therefore the net book value was £nil at 30 June 2021.

Manchester City 2020-21 Annual Report 41

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

15. TRADE AND OTHER RECEIVABLES

2021 2020
£000 £000
Current trade and other receivables
Trade receivables 174,163 150,094
Receivables arising from player transfers 25,201 52,024
Amounts owed by group undertakings 46,174 3,537
Amounts owed by related party undertakings (Note 24) 44 44
Other receivables 43 536
Prepayments and accrued income 33,866 13,908
Total 279,491 220,143

Non-current trade and other receivables

Receivables arising from player transfers 7,203 14,310
Total 7,203 14,310
Total trade and other receivables 286,694 234,453

The fair values of the above trade and other receivables are equal to their carrying values.
Trade and other receivables are non-interest bearing and credit terms vary depending on the
type of sale. Credit terms relating to player transfers are determined on a player by player
basis. Seasonal facilities are paid in advance of the season or are collected via direct debit on
a monthly basis throughout the season. Credit terms in relation to sponsorship agreements are
agreed on a contract by contract basis, usually over the life of the contract. Other sales have
credit terms ranging between 21 and 30 days.
The above accrued income balance is expected to be received within 12 months of year end.

Manchester City 2020-21 Annual Report 42

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

16. CURRENT TRADE AND OTHER PAYABLES

2021 2020
£000 £000

Lease liabilities (Note 18) 445 423

Trade payables 12,581 7,688
Payables arising from player transfers 54,826 60,397
Amounts owed to group undertakings 29,047 29,332
Amounts owed to related party undertakings (Note 24) 85 947
Other payables including tax and social security 50,852 15,551
Accruals 49,064 113,897
Refund payable – 1,594
Total 196,900 229,829

17. NON-CURRENT TRADE AND OTHER PAYABLES

2021 2020
£000 £000

Lease liabilities (Note 18) 64,303 64,748

Payables arising from player transfers 48,509 12,848
Accruals 4,688 –
Total 117,500 77,596

Manchester City 2020-21 Annual Report 43

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

18. LEASES

Lease liabilities include future obligations under the lease of the Etihad Stadium.
Details are provided within note 12. The capital amounts of repayments are as follows:
2021 2020
£000 £000
Maturity of lease liabilities
Within one year 445 423
Between one and two years 467 445
Between two and five years 1,550 1,475
After more than five years 62,286 62,828
Total 64,748 65,171

The cash flows required are as follows:

2021 2020
£000 £000

Within one year 3,550 3,550

In the second to fifth year 14,200 14,200
Over five years 136,075 139,625
Less future finance charges (89,077) (92,204)
Total 64,748 65,171

Manchester City 2020-21 Annual Report 44

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

19. DEFERRED INCOME

2021 2020
£000 £000

Deferred income 196,095 152,983

The above deferred income balance will be cleared within 12 months of year end.

20. DEFERRED TAX

The following are the deferred tax liabilities recognised alongside details of
the movements. Deferred tax assets and liabilities are only offset where a legally
enforceable right exists to do so. The table below analyses the deferred tax balances:
2021 2020
£000 £000

Deferred tax liabilities 11,171 8,490

Property
revaluation Total
£000 £000

At 1 July 2020 8,490 8,490

Debited to profit or loss account 2,681 2,681
As at 30 June 2021 11,171 11,171

On 3 March 2021, the UK Government announced that the UK corporation tax rate would in relation to accumulated losses, accelerated capital allowances and short-term timing
increase from 1 April 2023 from 19% to 25%. This was substantively enacted on 11 March differences due to the uncertainty as to whether it can be utilised in the foreseeable future.
2021. The Company has not recognised a deferred tax asset of £173.8m (2020: £135.3m) The losses do not have an expiry date.

Manchester City 2020-21 Annual Report 45

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

21. SHARE CAPITAL

The authorised and issued share capital at the beginning and end of the period is as follows:
2021 2020
£000 £000

Issued, fully paid and called up

1,339,574,450 ordinary shares of £1 each (2020: 1,316,345,585) 1,339,574 1,316,345

3,399 ordinary shares of £1 each – 25p paid (2020: 3,399) 1 1

Total 1,339,575 1,316,346

23,228,865 shares at a nominal value of £1 each were issued in the year.

22. PENSIONS
DEFINED CONTRIBUTION SCHEME As at 30 June 2021, the present value of the Club’s outstanding contributions (i.e. their
Contributions to the defined contribution pension scheme are charged to the profit or loss future liability) is £299,058. This amounts to £75,859 (2020: £72,246) due within one year
account in the period in which they become payable. The total contributions in the period and £223,199 (2020: £211,505) due after more than one year.
amounted to £1,450,000 (2020: £1,196,000). As at 30 June 2021, contributions of £133,000
The funding objective of the Trustees of the Scheme is to have sufficient assets to meet
(2020: £125,000) due to the pension scheme were unpaid and recorded in current liabilities.
the technical provisions of the Scheme. In order to remove the deficit revealed at the
previous actuarial valuation (dated 31 August 2020), deficit contributions are payable
DEFINED BENEFIT SCHEME
by all participating clubs. Payments are made in accordance with a pension contribution
Manchester City Football Club (‘the Club’) participates in the Football League Pension schedule. As the Scheme is closed to accrual, there are no additional costs associated
and Life Assurance Scheme (‘the Scheme’). The Scheme is a funded multi-employer with the accruing of members’ future benefits. In the case of a club being relegated from
defined benefit scheme, with 92 participating employers, and where members may the Football League and being unable to settle its debt then the remaining clubs may,
have periods of service attributable to several participating employers. The Club is in exceptional circumstances, have to share the deficit.
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. Upon the wind-up of the Scheme with a surplus, any surplus will be used to augment
benefits. Under the more likely scenario of there being a deficit, this will be split amongst
The last actuarial valuation was carried out at 31 August 2020 where the total deficit the clubs in line with their contribution schedule. Should an individual club leave the
on the ongoing valuation basis was £27.6m. Scheme, they may be required to pay their share of the deficit based on a proxy buyout
The accrual of benefits ceased within the Scheme on 31 August 1999. The Club basis (i.e. valuing the benefits on a basis consistent with buying out the benefits with
pays monthly contributions based on a notional split of the total expenses and an insurance company). The Club is a member of the Scheme, a pension scheme
deficit contributions of the Scheme. providing benefits based on final pensionable pay. As this subsidiary is one of a number
of participants in the scheme, it is unable to identify its share of assets and liabilities
The Club currently pays total contributions of £76,997 per annum which increases and therefore accounts for the contributions payable as if they were made to a defined
at 5.0% per annum and based on the actuarial valuation assumptions detailed above, contribution scheme. The Club is advised by the scheme administrators of the additional
will be sufficient to pay off the deficit by 30 June 2027. contributions required to fund the deficit. The administrators have confirmed that the assets
and liabilities cannot be split between the participating entities.

Manchester City 2020-21 Annual Report 46

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

23. COMMITMENTS

CAPITAL COMMITMENTS
The capital commitments contracted but not provided for consist of ongoing capital expenditure projects:
2021 2020
£000 £000

Contracted but not provided for 580 1,117

TRANSFER FEES PAYABLE OTHER COMMITMENTS

Additional transfer fees, signing on fees and loyalty bonuses of £227,983,568 Manchester City Football Club Limited has assigned fixed charges in favour of HSBC plc
(2020: £158,245,080) that will become payable upon the achievement of in relation to its Premier League media revenues and stadium matchday revenues, as security
certain conditions contained within player and transfer contracts if they are still for City Football Group’s credit facility with the Bank. HSBC plc hold a floating charge over all
in the service of the Club on specific future dates are accounted for in the year other Manchester City Football Club Limited assets. Additionally, the Club assigned the following
in which management assess, on a player by player basis, when the specific two consecutive payments from PUMA SE or PUMA International, in respect of the guaranteed
performance terms are met, resulting in the payment of contingent consideration. retainer on a rolling basis to Barclays to cover operational exposures.
Following the year end the HSBC facility was settled and terminated and therefore the above
commitments have now expired.
The Club acknowledge an ongoing Premier League investigation linked to the speculation
resulting from the illegal hacking and out of context publication of Club emails.

Manchester City 2020-21 Annual Report 47

NOTES TO THE FINANCIAL STATEMENTS CONTINUED

24. RELATED PARTY TRANSACTIONS 25. EVENTS AFTER THE REPORTING DATE
TRANSACTIONS WITH SUBSIDIARIES OF CITY FOOTBALL GROUP LIMITED Since the year end the Club has entered into agreements to acquire the football
registrations of Jack Grealish (from Aston Villa), Kayky Da Silva Chagas (from Fluminense),
Transactions during the year ended 30 June 2021 with New York City Football Club LLC, and Scott Carson (from Derby County). The football registrations of Jack Harrison (to Leeds
a fellow subsidiary of City Football Group Limited, consisted of trading balances totalling United), Ivan Ilic (to Hellas Verona), and Lukas Nmecha (to VfL Wolfsburg) have been sold.
£1,569,000 (2020: £1,254,000), which are included in receivables due within one year The net expenditure on these transactions was approximately £79.8m.
and the provision of services of £315,000 (2020: £366,000).
Transactions during the year ended 30 June 2021 with Girona FC SAD, a fellow subsidiary
of City Football Group Limited, consisted of trading balances totalling £nil (2020: £nil), 26. ULTIMATE PARENT COMPANY
which are included in receivables due within one year, and the sale of services totalling As at 30 June 2021 the Company’s ultimate parent undertaking was Abu Dhabi United Group
£50,000 (2020: £52,000). Investment and Development Ltd, a company registered in Abu Dhabi and wholly owned by
His Highness Sheikh Mansour bin Zayed Al Nahyan.
TRANSACTIONS WITH BROOKSHAW DEVELOPMENTS LIMITED
A balance from Brookshaw Developments Limited, a company also owned by Abu Dhabi City Football Group Limited is the parent undertaking of the smallest and largest group to
United Group Investment and Development Ltd, of £85,000 (2020: £947,000) is included consolidate these financial statements. Copies of City Football Group Limited consolidated
in payables due within one year. financial statements can be obtained from Companies House.
From 25 July 2021, the Company’s ultimate parent undertaking is Newton Investment and
TRANSACTIONS WITH EASTLANDS DEVELOPMENT COMPANY LIMITED Development LLC, a company registered in Abu Dhabi and is also wholly owned by His
A balance to Eastlands Development Company Limited, a company also controlled by Highness Sheikh Mansour bin Zayed Al Nahyan.
Abu Dhabi United Group Investment and Development Ltd, of £44,000 (2020: £44,000)
is included in receivables due within one year.

KEY MANAGEMENT COMPENSATION

No key management personnel were remunerated by the Company. Details of key
management compensation are listed in the notes of City Football Group Limited
financial statements in note 6.

Manchester City 2020-21 Annual Report 48