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An effort to boost the playing squad in an unsuccessful attempt to avoid relegation took its toll on the finances of Dunfermline Athletic last season, offsetting the effects of a good run in the Scottish Cup which took them to the final. Accounts for the Fife football club for the year ended 31 May show that the cost of supporting a big increase in player numbers was partly to blame for Dunfermline reporting an underlying loss. The cup run helped turnover grow from £2.9m to £5.1m. However, sharp increases in costs meant Dunfermline recorded an underlying loss before exceptionals of £137,908 compared with a profit of £105,880 in the previous year. The company's bottom line was boosted by the write-off of a loan of £904,360 due to Wood Investments. This is a company whose board used to include chairman John Yorkston and another Dunfermline director, Gavin Masterton, at one time managing director of the Bank of Scotland.
The write off helped the Pars record a pre-tax profit of £319,842, compared with a loss of £358,753 in the previous year. Noting that Dunfermline had an overdraft that was repayable on demand, but that the nature of the business meant that cash flows were uncertain, the club's auditor Thompson Cooper raised concerns about the appropriateness of its going concern status. However, the directors responded that this was appropriate given the financial restructuring that had taken place in recent years and the deferred nature of the company's remaining debt.
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