The Financial Reporting Council (FRC) has confirmed it is now overseeing an investigation into accounting irregularities at Manchester City, taking over the case from the Institute of Chartered Accountants in England and Wales on 30 September.
While no formal inquiry has yet commenced, the FRC is conducting a regulatory review of the club’s financial practices. The review follows an independent commission that found Manchester City guilty of all charges relating to breaches of the Premier League’s financial regulations between the 2009‑10 and 2017‑18 seasons, including inflating the club’s financial position by more than £900 million.
Manchester City has appealed the commission’s verdict, claiming it contains “material errors of law, principle and fact and is unsafe.” The club also argues that its auditors were “unaware” of the scheme used to disguise the origin of shareholder funds, a claim that the FRC will examine as part of its investigation.
The FRC, which routinely oversees accounting standards for listed public companies but not football clubs, now has the power to investigate the conduct of BDO – Manchester City’s auditors – and to sanction individuals such as directors or employees of the Etihad club if they are members of professional accountancy bodies.
BDO, the UK’s fifth‑biggest accounting firm, says it is a market leader in football, advising more Premier League and Championship clubs than any other firm. The FRC’s involvement is seen as a significant escalation, given its greater resources and powers to impose sanctions.
Liam Byrne, chair of the House of Commons Business, Culture and Sport Committee, has called for stronger powers for the FRC to compel evidence from clubs and pursue directors who fall outside its disciplinary rules. He warned that the regulator’s letter exposes gaps in its ability to hold companies and directors accountable.
As the investigation unfolds, stakeholders will watch closely to see whether the FRC can close the gaps identified by the commission and whether it will impose penalties on Manchester City or its auditors.
