sustainability Article Extraordinary Funding and a Financially Viable Football Industry—Friends or Foes? A Norwegian Football League Perspective Åse Jacobsen *, Morten Kringstad and Tor-Eirik Olsen NTNU Business School, Norwegian University of Science and Technology, 7491 Trondheim, Norway;
[email protected] (M.K.);
[email protected] (T.-E.O.) * Correspondence:
[email protected] Abstract: Financial distress has been frequently addressed in the sports business and management literature; however, surprisingly little attention has been devoted to implications for financial viability derived from funding beyond what the Union of European Football Association (UEFA) defines as relevant income in football, henceforth referred to as extraordinary funding. This study critically discusses and reflects upon whether extraordinary funding can contribute to financial viability. To address this issue, we draw on approximately 100 financial statements for Norwegian top division clubs and their cooperating companies for three fiscal years. Results indicate that, although extraor- dinary funding contributes with sorely needed funds, thus from the outset contributing in making clubs more robust, the manner in which extraordinary funding occurs is still of great importance from a viability perspective. In this respect, it is useful to distinguish clearly between ex ante and ex post funding. While ex post funding can be argued to be counter-productive to financial viability Citation: Jacobsen, Å.; Kringstad, M.; Olsen, T.-E. Extraordinary Funding (e.g., cloaking inadequate finances, providing incentives for overspending, and rewarding clubs that and a Financially Viable Football overspend), ex ante funding is more in line with sound financial management (e.g., funds that are Industry—Friends or Foes? A contingent upon a history of sound finances, incorporated in budgets).