The Sydney Swans would like to clarify the relationship between the Football Club, and the social club, Club SWANS.

In September 2004, the Sydney Swans signed a memorandum of understanding with the Sydney Aussie Rules Social Club (SARSC). Under this agreement, the SARSC was re-branded Club SWANS. This allowed Sydney Swans members to become members of Club SWANS, and to use the club as their social home.

While the Sydney Swans did not hold an ownership interest in Club SWANS, some Sydney Swans directors also sat on the board of the Sydney Aussie Rules Social Club and this meant the Swans had the ability to govern the financial and operating policies of Club SWANS. 

Consequently, under accounting rules, Club SWANS was a subsidiary of the Sydney Swans and was consolidated for financial reporting purposes.

Due to having to account for Club SWANS as a subsidiary of the Sydney Swans, the Independent Auditor’s Report in 2010 related to the consolidated financial entity.

Therefore when the Auditor commented that “there is significant uncertainty whether the consolidated entity can continue as a going concern” and “to continue as a going concern is dependent upon the continuing support of its landlord and principal banker”, these comments all related to the Club SWANS component of the consolidated entity, not Sydney Swans Limited.

There is no financial impact on the Sydney Swans now that Club SWANS has appointed an Administrator. All financial assistance from the Sydney Swans to Club SWANS has been fully provisioned in the accounts of Sydney Swans Limited in prior years.

Sydney Swans Chairman Richard Colless announced in February this year that Sydney Swans Limited (not the consolidated entity) had reported a $549,819 loss for 2010 which was a $200,000 improvement on the previous year.

Whilst the loss included non-cash expenses, in cash terms the result was a loss of $63,000.

On balance this was considered a reasonable result given the costs involved in establishing the QBE Sydney Swans Academy.

So far in 2011 the Sydney Swans Football Club has  achieved significant revenue growth from its Corporate Partners and is forecasting an increase of more than 30% in this important revenue source for the Sydney Swans.

2011 is tracking at this stage to record an improved financial result compared to 2010.