The Insolvency Challenge at Ibrox

The situation of the Season Ticket cash at RIFC/TRFC is interesting and perhaps needs clarifying.

At the start of the campaign I understand that around £5.2 million had been brought in.

As regular readers here will know the auditors Deloitte are adamant that these monies cannot be touched until the company can demonstrate that they have enough working capital or access of credit to allow them to continue for the rest of the season.

However, what the Directors of RIFC CAN do is to access those monies on a pro rata basis at the completion of each home fixture.

Then there will be no dispute that they have fulfilled their obligation to the customer for that portion of the Season Ticket price.

This is why Rangers Match Day Services Limited was established on April 4th 2011.

This, you may recall dear reader, was at the time of the famous nod of the head from club chairman Alastair Johnston.

Rangers Match Day Services Limited was set up  to protect the board of directors of the deceased club  from personal liability in the event of Rangers (1872-2012) being unable to fulfil their home fixtures in season 2011-2012.

This, incidentally, showed that the board members of that club were sufficiently concerned in early 2011 that Rangers might not be able to continue operating throughout the coming season.

In the end Rangers Match Day Services, although established, was never put into operation.

When Craig Whyte bought the club he had no need of such frivolities and  proceeded as if nothing iffy was about to happen.

Had Rangers Match Day Services had been put into operation then it would have been, in effect, as escrow account for season ticket monies.

This corporate vehicle would have dripped down part of each season ticket on a game by game basis thus protecting the board of directors from any personal liability in the unlikely event of Rangers experiencing an insolvent event during that season.

If the RIFC directors are not touching these monies then they are, perhaps, in receipt of similar legal advice as was given to the directors of Rangers (1872-2012) at the start of 2011.

This also raises interesting questions about the VAT due on these season tickets.

However that is for another day.

In the meantime RIFC/TRFC is a loss making business with no credit line from a bank.

Moreover, the board of directors have to find external financing and find it fairly quickly.

What they could do with is another George Letham to step forward.

They need a break.

Actually they need someone to show them some generosity.

Sevco has become a charity case.

It remains to be seen if they can keep their head above water in the months ahead.

Meanwhile Charles of Normandy is dripping in wealth as the club he set up continues to give generously.

To him…

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