SINGAPORE - The Football Association of Singapore (FAS) is standing firm on its decision for beleaguered Warriors FC to sit out the upcoming Singapore Premier League (SPL) season, reiterating in a statement on Thursday (Jan 9) that it remains fully committed to working with the latter to help "pull through this challenging period".
In its five-page media statement, the FAS said that Warriors' financial statements - the club recorded a net capital deficit of $1,158,249 at the end of 2018 - "underscore the severity of the club's financial problems" and that it was in the best interests of the club to sit out the 2020 season.
Last December, the sport's governing body had instructed the SPL's most storied club to sit out the upcoming season, a decision that was swiftly rejected by Warriors as its chairman Philip Lam criticised the manner in which the decision had been made without consulting him or key representatives of the club.
However, the FAS said that it had been in contact with Warriors since September last year to assess whether it was financially sustainable for the club to participate in the SPL this year.
"The club is therefore well aware that with its continuing financial problems, it would not be able to comply with the FAS Club Licensing requirements, necessary for any club to participate in the 2020 season," said the statement.
"In fact, in its various discussions with the FAS on how to resolve its financial problems, Warriors FC had itself mooted the idea of sitting out of the 2020 season, although it subsequently changed its mind."
However, Lam’s spokesman said on Thursday that a SPL sit-out would only “worsen the financial state of the club” as it would not be able to continue gaming operations and pay off its debts. Thirty employees, both players and staff, would also be affected and agreed installment plans with various agencies would be at risk of default, he added.
Warriors, the record nine-time champions of the S-League, have been saddled with financial problems since 2018 and the FAS said on Thursday that the club owed more than $800,000 to players, staff, the Central Provident Fund (CPF) Board and Inland Revenue Authority of Singapore (IRAS) as of Dec 31, 2019.
In October 2018, The Straits Times reported that Warriors had struggled to pay their staff on time, which led to the Ministry of Manpower suspending their work-pass privileges, barring them from foreign hires.
In November last year, Warriors were charged with owing arrears of over $350,000 in salaries - of which $150,000 was paid to players last month through loans from their management committee members - to their employees from as far back as July.
The FAS said that the club also did not make timely payments of requisite taxes for its gaming machines and Goods and Services tax to the IRAS. It added that Warriors also owed money to other third-party creditors, including Borussia Dortmund for a licensing fee.
It added that the financial governance and propriety of the club "is also called into serious question" as Warriors had repeatedly failed to submit monthly management accounts and audited financial statements.
The national sports association had also through its engagements with Singapore Pools, helped Warriors to secure a 4D betting outlet at Jalan Bukit Merah to provide the club with an additional revenue stream, said the FAS.
Noting that the club's management was "unable to rectify the long-standing financial problems" and that its financial position and governance had progressively worsened, the FAS had issued a directive to Warriors to replace its general manager. The club has refused to comply with the directive, said the FAS.
Warriors, which has signed deals with 15 players for the upcoming season, had also asked to participate in the 2020 season so that it could be eligible to receive the FAS' subsidies and obtain a licence for operating its gaming machines, which FAS noted "had nothing to do with the football interests of the club".
"It was in these circumstances that the FAS decided that it was necessary and in the best interests of Warriors FC, including its players and staff, for the club to sit out of the 2020 season. This is not a decision taken lightly by the FAS," said the statement.
The FAS stressed that the sit-out period would allow Warriors to "focus on rehabilitating, consolidating the club's resources and improving its financial position" in order to compete in the 2021 season. It had also instructed the club to engage professional auditors to conduct a forensic audit of its accounts and financial transactions to determine the causes of its predicament and identify any systemic failures in its financial system or governance, and to make recommendations to resolve them.
The club had written a note to the FAS on Tuesday requesting for a Jan 13 deadline to present a detailed plan for Warriors to remain in the SPL. This would include a financial plan and proposals for operations, debt servicing and revenue generation.
It would also include the result of ongoing discussions with two foreign entities – City Academy and the Australasian Soccer Academy – regarding a takeover.