West Bromwich Albion has been penalized two points for violating EFL finance rules, specifically regarding Profit and Sustainability (P&S) regulations. Under these rules, Championship clubs can have a maximum loss of £39 million over a rolling three-year period.
Financial Overview and Recent Losses
The club faced scrutiny from the EFL after reporting increased losses of £23.4 million during the 2023-24 accounting period. This is their first period without parachute payments following relegation from the Premier League in 2021. Overall, West Bromwich Albion has incurred a total loss of £55.6 million since July 2022.
Exemptions and P&S Calculations
For P&S calculations, certain expenditures, including spending on infrastructure, the academy, and the women’s team, are exempt. This exemption means that, despite the reported losses, the actual figure for P&S purposes is considerably lower.
- Maximum allowable loss under P&S: £39 million
- Total loss since July 2022: £55.6 million
- Loss reported for 2023-24: £23.4 million
Dispute with EFL
West Bromwich Albion is contesting the EFL’s decision, particularly related to their financial practices regarding their charity partner, The Albion Foundation. The club argues that the EFL has shifted the criteria for community development expenditure.
Earlier in the year, the Club Financial Reporting Unit (CFRU) allowed the club to factor in “in-kind” donations—such as facilities and staff support—when calculating their financial position. However, a sudden change in the CFRU’s approach has resulted in a retrospective adjustment that the club claims has led to their P&S breach.
West Bromwich Albion stated it would explore options for a possible appeal against the points deduction. The club believes that without the CFRU’s revised approach, they wouldn’t have violated the P&S regulations.
