What a sanction does to the people around a club

What happens to the players?

Usually nothing, directly. A sanction on the club is not a sanction on its players. The Rules recognise these playing arrangements:

The standard contract sets out a basic wage, then “such of the bonuses and incentives as the Player shall be entitled to receive under the terms of the Club’s bonus and incentive scheme”, then other payments and benefits (Form 14, Schedule 2, clause 8). The club may deduct only what the player agreed to or what is “clearly established to be properly due” (clause 5.3), and may end the contract only for gross misconduct, an ignored final warning or a prison sentence of three months or more (clause 10.1).

What can move is a trigger. If a player’s bonus scheme pays on a league position, a European place or a trophy, a points deduction may decide whether it pays. The schemes are private; the Handbook prints only the blank form.

And the prize money?

It follows the table. The League shares out its UK broadcast money in funds. After a deduction for the League’s expenses and other agreed sums, the balance is split one half to a Basic Award Fund (shared equally), one quarter to a Facility Fees Fund (paid by televised matches), and one quarter to the Merit PaymentsThe share of the Premier League's UK broadcast money paid by final league position. Fund (D.16How UK broadcast money is split2022/23: D.16, p.63 ↗2026/27: D.16, p.66 ↗“one quarter shall comprise the Merit Payments Fund” (2022/23)Half to a Basic Award Fund, a quarter to Facility Fees, a quarter to the Merit Payments Fund.All rules, both editions →). The Merit Payments Fund is paid out after each season “in accordance with the Merit Based Distribution Method” (D.17.2). Glossary entry.

The method itself is a table of shares by final league position, set out in the Handbook’s definitions (A.1.154The Merit Based Distribution Method2022/23: A.1.154, p.51 ↗2026/27: A.1.201, p.53 ↗“the distribution of such funds in shares in accordance with the following table” (2022/23)Merit money is shared by final position: 20 shares for first down to 1 for twentieth.All rules, both editions →):

So the League’s champion takes 20 shares and the club in twentieth place takes one. The twenty clubs together hold 210 shares (1 + 2 + … + 20), so each share is one 210th of the fund. That is our arithmetic from the table; the Rules do not state a sum in pounds, and the course gives none.

A points deduction that moves a club down the final table moves it down this table. A club that would have finished tenth, on 11 shares, and is deducted enough points to finish twelfth, on 9, loses two shares of the 210 in the fund, and the clubs it falls behind gain one each. A deduction that does not change the final position changes nothing here. The Rules also make the distribution “subject to” two other rules (E.19 and E.28), which this course has not read for that purpose.

Can sponsors take their money back?

Only if their contracts let them. Nothing in the Rules gives a sponsor a refund or an exit when a club is sanctioned; the deal’s own termination, morality and warranty clauses decide. The general law adds one route — misrepresentation. A party talked into a contract by a false statement can claim damages unless the other side “proves that he had reasonable ground to believe and did believe up to the time the contract was made the facts represented were true” (Misrepresentation Act 1967, s.2(1)).

In past scandals the first sponsor response, as the press reported it, was a statement, a suspension or a walk-away — not a refund claim. The nearest thing to money back was a fraud claim: a bonus payer reopened a settled arbitration against the cyclist Lance Armstrong after his admission and won $10 million in 2015 (reported; the award was not read for this course).

Are the auditors exposed, and to whom?

To outsiders, rarely. An audit firm is not a party to a league’s case, and those who relied on the accounts usually cannot sue it: “auditors of a public company’s accounts owe no duty of care to members of the public at large who rely upon the accounts in deciding to buy shares”, and the House of Lords applied the same logic to lenders and suppliers giving credit (Caparo v Dickman [1990] UKHL 2).

The audited company is a different claimant — but where its own controller ran the fraud, the auditor may have a defence. In Stone & Rolls v Moore Stephens [2009] UKHL 39 the company’s claim was barred, though the judges divided and the Supreme Court later noted the view that the case produced “no majority reasoning” (Jetivia v Bilta [2015] UKSC 23).

The heavier exposure has been regulatory, and it comes from a different body. A football club’s auditor is a private accounting firm. The regulator of auditors is the Financial Reporting Council(FRC), which says it regulates “auditors, accountants and actuaries” and sets the UK’s Corporate Governance and Stewardship Codes (FRC). It exists to hold the people who audit public companies to account, for the benefit of those who rely on their accounts. It is not part of football: it is neither the FA, nor the Premier League, nor the Independent Football Regulator (Section 1).

KPMG and EY appear here only as examples of audit firms the FRC has sanctioned, for audits of other companies. They are not named in the City decision. The FRC fined KPMG LLP £18.55 million, after a 30% discount, over the Carillion audits (12 October 2023), and EY £4.875 million, after a 25% discount, over the Thomas Cook audits for the years ended 30 September 2017 and 2018 (10 April 2025). Both were listed-company audits; whether the FRC’s procedure reaches a football club’s audit is outside this course.

How long does regulatory action take? The Carillion investigations were opened on 26 January 2018 and the sanctions published on 12 October 2023, more than five and a half years later. The EY announcement does not say when its investigation opened. We found no statutory time limit for these cases. For 2024/25 the FRC reported that 90% of the applicable investigations were completed or resolved within two years (2024/25 enforcement review). A revised Audit Enforcement Procedure took effect on 1 July 2026 (FRC, July 2026).