WICB: Bankruptcy Reports Exaggerated

The West Indies Cricket Board (WICB) says reports of its state of bankruptcy have been greatly exaggerated.

Reacting to a CMC Sports report that it's depending entirely on profits from the 2007 World Cup to stave off bankruptcy, the board said the financial statement cited in the news item includes results of both the WICB and its 100%-owned World Cup subsidiary.

"The Board is currently investing in preparations for hosting Cricket World Cup 2007 which is the third largest global sporting event after FIFA's Football World Cup and the Olympic Games and on which US$22.0 million was invested as at September 30th 2005," the WICB explained.

It said accounting standards require that the $22 million is not reflected as an investment in the Balance Sheet to be offset against the revenues from the event.

Instead, the WICB said that amount must be expensed.

"Without these amounts, the accumulated deficit in the Consolidated Accounts would reflect US$15 million which has been fairly constant over the past four (4) years and which is not going to increase in the current financial year," the board added.

"The Board also wishes to draw attention to its improved performance in the current financial year which is expected to show a break even position at year end September 30th 2006 compared with a loss of US$6.5 million in the prior year," the WICB added.

Additionally, the WICB said steps have been taken to reduce costs and to identify new lines of revenue including the Windies Superball Lottery game to be launched in August 2006, the WICB Co-branded Credit Card, the ODI's to be held in conjunction with the Indian cricket board and the licencing and merchandising program promoted in connection with the World Cup.

According to the CMC Sports report , the financial statements indicated that the WICB and its World Cup subsidiary had incurred a net loss of US$19 million, during the year ended September 30, 2005.

"And as of that date, it had an accumulated deficit of US$34 million, and that the group's current liability exceeded its current assets," the report stated.