Munster recorded a financial deficit of €1.9 million this season.
When Munster concluded their AGM last Thursday night, the grim reality of their financial position was laid out for all to see.
Years of mismanagement, both on and off the pitch, had culminated in the province posting a massive €1.9 million deficit for the year ending June 30 2016.
Although Munster’s Financial Controller, Philip Quinn, cited reduced gate receipts and increased player costs for the poor financial returns, the fact remains that the province’s deficit is far in excess of €330,000 recorded at last year’s AGM.
As a result, the Irish Independent have reported that the IRFU will come to Munster’s aid by topping up their annual grant by an additional €1.1 million.
Furthermore, as Munster owe €10 million following the the revamp of Thomond Park, an agreement has been reached whereby the annual repayment of €200,000 will not be sought by the IRFU, instead the province will only service the interest on the loan this year.
Quinn told the Irish Examiner,
We were due to pay €200,000 this year but the IRFU haven’t asked us for that money. They asked us for the interest but we’re talking €50-60,000 interest, which is the deposit rate that they’d be getting on the €10 million.
With Munster badly in need of a number of new players, what this means for Rassie Erasmus and his management team is not yet clear.
However what has become evident, is the distance Munster must now travel if they are to compete with Europe’s elite teams in the future.
Alan Drumm, Pundit Arena