REGISTERED NUMBER: SC012085 (Scotland)

Financial Statements for the Year Ended 31st May 2025

for

Queen of the South Football Club,

Limited

Page

Company Information

1

Balance Sheet

2

Notes to the Financial Statements

3

to

8

DIRECTORS:

C Paterson

W J Hewitson

SECRETARY:

C Paterson

REGISTERED OFFICE:

Palmerston Park

Terregles Street

Dumfries

Dumfriesshire

DG2 9BA

REGISTERED NUMBER:

SC012085 (Scotland)

SENIOR STATUTORY AUDITOR:

Stephen Harman BA CA

AUDITORS:

Messrs. Carson & Trotter

Chartered Accountants

Statutory Auditor

123 Irish Street

Dumfries

DG1 2PE

BANKERS:

Virgin Money

84 - 86 High Street

Dumfries

Dumfries & Galloway

DG1 2BJ

FIXED ASSETS

Intangible assets

4

-

1,000

Tangible assets

5

1,246,035

1,342,090

Investment property

6

301,581

301,581

1,547,616

1,644,671

CURRENT ASSETS

Stocks

22,500

23,500

Debtors

7

114,768

149,623

Cash at bank and in hand

45,354

81,878

182,622

255,001

CREDITORS

Amounts falling due within one year

8

(206,162

)

(171,277

)

NET CURRENT (LIABILITIES)/ASSETS

(23,540

)

83,724

TOTAL ASSETS LESS CURRENT LIABILITIES

1,524,076

1,728,395

PROVISIONS FOR LIABILITIES

9

(56,932

)

(56,932

)

NET ASSETS

1,467,144

1,671,463

CAPITAL AND RESERVES

Called up share capital

7,500

7,500

Share premium

1,010,022

1,010,022

Revaluation reserve

10

220,575

227,930

Retained earnings

229,047

426,011

SHAREHOLDERS' FUNDS

1,467,144

1,671,463

The financial statements have been prepared and delivered in accordance with the provisions applicable to companies subject to the small companies regime.

In accordance with Section 444 of the Companies Act 2006, the Income Statement has not been delivered.

The financial statements were approved by the Board of Directors and authorised for issue on 27th March 2026 and were signed on its behalf by:

C Paterson - Director

1.	STATUTORY INFORMATION

Queen of the South Football Club, Limited is a private company, limited by shares , registered in Scotland. The company's registered number and registered office address can be found on the Company Information page.

The financial statements cover only the individual entity and are presented in Sterling.

2.	ACCOUNTING POLICIES

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" including the provisions of Section 1A "Small Entities" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention as modified by the revaluation of certain assets.

The directors have considered the consequences of the recent performance of the company, and within the sector, on the company's ability to continue as a going concern. As a result of an extended period competing in League One, there have been increased financial pressures on the club. The company has reported a loss before tax of £204,319 (2024 - £64,104), with net assets of £1,467,144 (2024 - £1,671,463). The directors continue to look at ways to bring the club back to an even financial footing and are optimistic that this can be achieved within the short term.

Cashflow forecasts have been prepared by the directors, which recognise the ongoing challenges faced by the club. While forecasts are inherently uncertain, the directors are confident that the club will continue to meet its debts as they fall due. The directors have also signalled their intention to financially support the club for at least the next 12 months if required in the form of a signed letter of support. Given this, the directors remain confident that the company can continue to operate as a going concern and accordingly, the financial statements have been prepared on that basis.

Turnover

Turnover represents the net income from the company's activities, excluding Value Added Tax.

Turnover includes all gate receipts, season tickets, advertising, sponsorship, programme sales, hospitality receipts, transfer fees, club shop sales, payments for television rights, aerial rentals and any club organised functions as well as income from the Scottish Football Association and Scottish Football League that is linked directly to the above. It also includes the regular income from the club lottery and any grants and donations that are received in respect of normal trading.

As can be seen in Note 4, this does not include certain specific grants, donations or rents receivable which are defined as 'Other Operating Income'.

Intangible assets - transfer fees

Intangible assets represent monies paid in the form of transfer fees to other football clubs to procure the services of football players. Amortisation is provided at rates calculated to write off this cost in equal instalments over the period of the player's initial contract.

Tangible fixed assets

Depreciation is provided at the following annual rates in order to write off each asset over its estimated useful life or, if held under a finance lease, over the lease term, whichever is the shorter.

Freehold property

-

2.5% on reducing balance

Plant and machinery

-

20% on reducing balance and 10% on cost

Motor vehicles

-

25% on reducing balance

Amounts written off each asset over the estimated useful life represent cost less residual value.

Investment property

During 2014 and 2015 the company undertook a major development project with the former supermarket building next to the ground. This was redeveloped as the 'Queen of the South Arena' which incorporates two indoor football pitches traded by the club as well as a number of unrelated businesses. This property is thus now mixed use, held partly for investment purposes and partly for trading purposes. In accordance with FRS 102 the value of the building has been split between the value attributable to the club and included within Freehold property and the value attributable to investment purposes, shown separately as Investment property. No depreciation has been provided in respect of investment property. This represents a departure from the Companies Act requirements to provide for systematic annual depreciation of fixed assets. The directors consider that the adoption of this policy is necessary in order to give a true and fair view.

Stocks

Stocks are valued at the lower of cost and net realisable value, after making due allowance for obsolete and slow moving items.

Taxation

Taxation for the year comprises current and deferred tax. Tax is recognised in the Income Statement, except to the extent that it relates to items recognised in other comprehensive income or directly in equity.

Current or deferred taxation assets and liabilities are not discounted.

Current tax is recognised at the amount of tax payable using the tax rates and laws that have been enacted or substantively enacted by the balance sheet date.

Deferred tax

Deferred tax is recognised in respect of all timing differences that have originated but not reversed at the balance sheet date.

Timing differences arise from the inclusion of income and expenses in tax assessments in periods different from those in which they are recognised in financial statements. Deferred tax is measured using tax rates and laws that have been enacted or substantively enacted by the year end and that are expected to apply to the reversal of the timing difference.

Unrelieved tax losses and other deferred tax assets are recognised only to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits.

Leasing

Assets obtained under hire purchase contracts or finance leases are capitalised in the balance sheet. Those held under hire purchase contracts are depreciated over their estimated useful lives. Those held under finance leases are depreciated over their estimated useful lives or the lease term, whichever is the shorter.

The interest element of these obligations is charged to profit or loss over the relevant period. The capital element of the future payments is treated as a liability.

Rentals paid under operating leases are charged to profit or loss on a straight line basis over the period of the lease.

Pension costs and other post-retirement benefits

The company operates a defined contribution pension scheme. Contributions payable to the company's pension scheme are charged to profit or loss in the period to which they relate.

Revenue recognition

In accordance with the principles of revenue recognition, income is recognised as the rights to consideration obtained through performance of contractual obligations, and is included in the financial statements when the company is legally entitled to the income.

Other grant income

The directors have chosen to recognise capital grants within the Income Statement based on the performance method permitted by FRS 102. The directors believe that this leads to a more realistic balance sheet for the company.

Financial instruments

Cash and cash equivalents

Cash and cash equivalents comprise cash on hand and call deposits, and other short term highly liquid investments that are readily convertible to a known amount of cash and are subject to an insignificant risk of change in value.

Trade debtors

Trade debtors are amounts due from customers for the sale of goods and services performed in the ordinary course of business. Trade debtors are recognised initially at the transaction price and represent the full value of the services charged to customers.

Trade Creditors

Trade creditors are obligations to pay for goods or services that have been acquired in the ordinary course of business from suppliers.

Accounts payable are classified as current liabilities if the company does not have an unconditional right, at the end of the reporting period, to defer settlement of the creditor for at least twelve months after the reporting date. If there is an unconditional right to defer settlement for at least twelve months after the reporting date they are presented as non current liabilities.

Borrowings

Interest bearing borrowings are initially recorded at fair value, net of transaction costs. Interest bearing borrowings are subsequently carried at amortised cost, with the difference between the proceeds, net of transactions costs, and the amount due on redemption being recognised as a charge to the profit and loss account over the period of the relevant borrowing.

Interest expense is recognised on the basis of effective interest method and is included in interest payable and similar charges.

Borrowings are classified as current liabilities unless the company has an unconditional right to defer settlement of the liability for at least twelve months after the reporting date.

Share Capital

Ordinary shares are classified as equity. Equity instruments are measured at the fair value of the cash or other resources received or receivable, net of the direct costs of issuing the equity instruments. If payment is deferred and the time value of money is material, the initial measurement is on a present value basis.

3.	EMPLOYEES AND DIRECTORS

The average number of employees during the year was 37 (2024 - 42 ) .

4.	INTANGIBLE FIXED ASSETS

Transfer

fees

£

COST

At 1st June 2024

7,000

Disposals

(7,000

)

At 31st May 2025

-

AMORTISATION

At 1st June 2024

6,000

Amortisation for year

1,000

Eliminated on disposal

(7,000

)

At 31st May 2025

-

NET BOOK VALUE

At 31st May 2025

-

At 31st May 2024

1,000

5.	TANGIBLE FIXED ASSETS

Freehold

Plant and

Motor

property

machinery

vehicles

Totals

£

£

£

£

COST OR VALUATION

At 1st June 2024

1,488,663

934,599

77,209

2,500,471

Additions

-

705

-

705

Disposals

-

-

(38,991

)

(38,991

)

At 31st May 2025

1,488,663

935,304

38,218

2,462,185

DEPRECIATION

At 1st June 2024

563,913

550,149

44,319

1,158,381

Charge for year

23,130

54,615

7,840

85,585

Eliminated on disposal

-

-

(27,816

)

(27,816

)

At 31st May 2025

587,043

604,764

24,343

1,216,150

NET BOOK VALUE

At 31st May 2025

901,620

330,540

13,875

1,246,035

At 31st May 2024

924,750

384,450

32,890

1,342,090

Cost or valuation at 31st May 2025 is represented by:

Freehold

Plant and

Motor

property

machinery

vehicles

Totals

£

£

£

£

Valuation in 2003

237,163

-

-

237,163

Valuation in 2015

56,469

-

-

56,469

Cost

1,195,031

935,304

38,218

2,168,553

1,488,663

935,304

38,218

2,462,185

Fixed assets, included in the above, which are held under hire purchase contracts or finance leases are as follows:

Plant and

machinery

£

COST OR VALUATION

At 1st June 2024

45,982

Transfer to ownership

(45,982

)

At 31st May 2025

-

DEPRECIATION

At 1st June 2024

30,922

Transfer to ownership

(30,922

)

At 31st May 2025

-

NET BOOK VALUE

At 31st May 2025

-

At 31st May 2024

15,060

6.	INVESTMENT PROPERTY

Total

£

FAIR VALUE

At 1st June 2024

and 31st May 2025

301,581

NET BOOK VALUE

At 31st May 2025

301,581

At 31st May 2024

301,581

Fair value at 31st May 2025 is represented by:

£

Valuation in 2003

118,582

Valuation in 2015

28,234

Valuation in 2023

80,000

Cost

74,765

301,581

The QoS Indoor Arena building was valued on an open market basis on 22nd January, 2024 by DM Hall LLP, Chartered Surveyors at £1,000,000. This property has mixed use, being partly held traded by the club and partly held as investment property. On an approximate floorspace basis, it has been allocated as 70% Freehold Property and 30% Investment Property.

7.

DEBTORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2025

2024

£

£

Trade debtors

104,062

130,783

Other debtors

2,868

2,855

Prepayments

7,838

15,985

114,768

149,623

8.

CREDITORS: AMOUNTS FALLING DUE WITHIN ONE YEAR

2025

2024

£

£

Trade creditors

78,427

36,422

Social security and other taxes

11,359

26,983

VAT

9,381

4,161

Other creditors

523

-

Prepaid income

85,712

73,036

Accrued expenses

20,760

30,675

206,162

171,277

Monies received in advance for the following football season, most typically with regard to the "Shirt Sponsorship Draw", are included within 'Prepaid income'.

9.	PROVISIONS FOR LIABILITIES

2025

2024

£

£

Deferred tax

56,932

56,932

Deferred

tax

£

Balance at 1st June 2024

56,932

Balance at 31st May 2025

56,932

The deferred taxation provision arises from the requirement under FRS 102 to provide for deferred taxation on unrealised revaluation gains on investment property.

10.

RESERVES

Revaluation

reserve

£

At 1st June 2024

227,930

Amortised revaluation reserve

(7,355

)

At 31st May 2025

220,575

Called up share capital represents the nominal value of shares that have been issued.

Share premium includes any premiums received on issue of share capital.

Revaluation reserve comprises the value of asset revaluations and fair value movements on assets recognised in other comprehensive income. This does not include revaluations on investment property for which revaluations are adjusted within the retained earnings, in line with the requirements of FRS102.

Retained earnings includes all current and prior period retained profits and losses.

Non distributable amounts within retained earnings

Retained earnings includes an unrealised gain of £234,357 recognised on investment property, less a provision of £56,932 for deferred taxation on this unrealised gain. The net total of £177,425 is not distributable under company law.

11.	DISCLOSURE UNDER SECTION 444(5B) OF THE COMPANIES ACT 2006

The Report of the Auditors was unqualified.

Stephen Harman BA CA (Senior Statutory Auditor)

for and on behalf of Messrs. Carson & Trotter

12.	RELATED PARTY DISCLOSURES

During the year under review all of the directors, either personally as individuals, or through other business interests, have taken commercial sponsorships and advertising with the club. However, none of the sums involved were material enough to either party to warrant separate disclosure.