SPFC explains overrun of R$106 million in budget with James, Lucas and awards

São Paulo’s 2023 balance sheet shows that the club spent R$106,054,000 more on the professional football department last year than its budget predicted.

In the document, the budget overrun is explained, in part, by the hiring of James Rodríguez and Lucas Moura. While the Colombian never established himself in the team, the Brazilian quickly became an important player.

“The variation in expenditure in professional football [em relação à previsão orçamentária] justified by the payment of the prize resulting from winning the Copa do Brasil, expenses directly proportional to the increase in box office revenue and investment in hiring
of the new technical committee, in addition to the
athletes Lucas Moura and James Rodríguez, among others”, says an excerpt from the tricolor balance. The technical committee mentioned is that of Dorival Júnior.

It is worth remembering that James and Lucas were free on the market. The balance does not specify individual expenses on gloves, salaries and image rights with its players.

Last year, Tricolor’s expenditure on professional football was R$531,666,000. The forecast had been an expenditure of R$425,612,000.

The document deals with the money invested in the team as follows:

“In professional football, R$76.7 million was invested in hiring athletes. Between permanent and temporary contracts, SPFC made adjustments with James Rodríguez, Lucas Moura, Michael Araújo, David Corrêa, Gabriel Neves, Alan Javier Franco, Jhegson Sebastian” Mendez”, Damian José Bobadilla, in addition to renewing contracts with athletes Pablo Maia, Rodrigo Nestor, Jandrei, and Jonathan Calleri, among others, strengthening the formation of a competitive squad, which won a much-desired title [Copa do Brasil]”.

Alert

The budget overrun in relation to football expenses was subject to observation in the opinion issued by the club’s Fiscal Council (CF) attached to the balance sheet.

“We emphasize that despite the absence of accounting irregularities, there was a considerable increase in expenses, mainly those related to professional football, exceeding the budget approved by the Honorable Deliberative Council for the year analyzed in a percentage exceeding that allowed”, says the opinion.

“It is important to highlight that in the continuous analysis carried out by this Supervisory Board of the club’s accounts, through the financial board and monthly examination of the balance sheets for the 2023 financial years, we alert the board regarding the need for strict compliance with the budget in its entirety, with special attention expenses, so that in this way we can reduce the institution’s growing debt”, points out another excerpt from the CF’s opinion.

However, the agency highlighted the increase in money inflow. “However, in a more detailed analysis, we can also see an increase in revenue, exceptionally those related to box office collections and TV rights, in addition to the variation in revenue from the stadium and social complex. Notably, the unprecedented victory of the World Cup title Brazil fostered numerous unforeseen benefits, adding additional revenue and appreciation of the institution’s assets: brand, stadium and enhancing other ‘assets'”, points out the document. The CF recommended the approval of the balance sheet by the Deliberative Council, which happened.

Awards

The breakdown of football expenses, in fact, shows that the payment of prizes was important. R$53,035,000 was spent on prizes. In 2022, this expense had been R$10,349,000.

Spending on rights to use images in football (professional and grassroots) jumped from R$51,415,000 in 2022 to R$78,832,000.

Personnel expenses (includes salaries of players, coaching staff and other employees from the professional department and base) was R$160,671,000 in 2023. In the previous year, this expense had been R$146,779,000.

Revenues

In turn, the revenue generated by the association’s main department in 2023 exceeded the forecast recorded in the budget by R$40,239,000.

Revenue last year was R$579,296,000 compared to a forecast of R$539,057,000.

The revenue obtained from the games went from R$64,402,000 in 2022 to R$110,230,000 last year.

In a contrary movement, the revenue obtained from the negotiation of athletes fell from R$228,694,000 to R$120,724,000. The values ​​also include fundraising with a solidarity mechanism.