This article exposes the difficulty accountants have in deciding what is capital and what is revenue. In essence, it is a conflict between the matching rule and the reliability rule.
1 Where would you look for ‘intangible assets’ in a set of financial statements?
2 Do you agree with the current requirement that transfer fees and signing-on fees should be treated as an intangible asset?
3 If transfer fees and signing-on fees are not to be treated as intangible assets, how do you think that they should be dealt with in the financial statements?
4 What effect would this alternative treatment have on

(a) a club’s profit; and

(b) on its balance sheet?