VISION GROUP

MEMBERS
Dear Mphiri
Master Maideni
Noel Kapalamula
Chipiliro Kasinja
Innocent Mbendera
Linda kasito
Innocent Chimpesa
Decca Linje
Vincent Likongwe
Mphatso Chilamba
Margret Matekenya
  

MEMO
 
TO : The Chief Executive Officer
FROM : The Accountant
DATE : 31st January, 2023.
 RE: HOW ACQUISITION OF NEYMAR FITS IN OUR FINANCIAL
STATEMENTS
As we are preparing the year ended 2019 financial statements the acquisition of
Neymar will fit in the following areas of financial statement as follows:
 ASSETS
Acquisition of Neymar will increase the value of our intangible assets with $100,
000.00 which will contribute to future economic benefits in form of cash inflows.
Since Neymar has signed our contract, we have full control over him and that he
cannot play for another club except Barcelona.
 LIABILITIES
Since we have acquired Neymar using a loan from BL Bank, our liabilities will
increase by $ 100, 000.00 and the club has an obligation to settle the loan
which will result in an outflow of our resources hence decreasing the
economic benefits.
 INCOME
The signing of Neymar to our club will bring the following future economic
benefits:
Commercial merchandise for example sale of kits and tickets
Sponsorship deals
Television rights
Winning of trophies
Selling him at a profit in future
The above economic benefits will help us to reduce liability hence increasing
our equity.
EXPENSES
Since the club has obtained a loan to pay for the acquisition of
Neymar, the club has an obligation to pay interest amounting to
$ 20 000.00 per year. In addition to this there will be other
expenses like Salaries, game bonuses and fringe benefits. These
expenses will increase outflows there by reducing our economic
benefits.
 
In conclusion transaction of acquiring Neymar affects multiple
elements of the financial statement and it is important to correctly
record these Transactions to accurately reflect in the Financial position
of the club.
 Submitted for your information and action.
 
VISION GROUP