Despite receiving the money from a new loan that will not be paid off until December 2025, Watford are standing behind statements made at the summer fan forum with owner Gino Pozzo that the club will be debt-free by summer 2024.

The loan has been taken with Macquairie Bank, who Watford have dealt with regularly in the last few years.

It’s for €11,375,000 and is basically an advance on the outstanding portion of the transfer fee agreed with Marseille for Ismaila Sarr – with the repayments being made by the French club, and not the Hornets.

As with many such transfer deals these days, Marseille would ordinarily pay Watford in a series of instalments.

However, the arrangement with Macquairie means Watford have the money now from the bank and Marseille pay off the loan instead.

Watford will ultimately receive less than if they had waited for Marseille to pay the instalments, as there will be interest payable on the Macquairie advance - Watford will probably end up with a figure around €10.5m.

Effectively, the club can point to the fact that they aren’t repaying the loan and the debt is with Marseille, which is why they are happy that what chairman Scott Duxbury told fans in the summer is still accurate.

“The situation is really simple,” he said in June.

“We have £25m of debt with Macquarie that will be repaid in full in 12 months’ time, and then we are effectively debt free. We only have owner debts, and owner debts is a vehicle for funding the growth and continual development of the football club.

“It’s quite normal, it’s what most owners do, put working capital into the club. That’s the position.

“The only thing we need to concern ourselves with is Macquarie debt and that’s £25m, repaid in full in 12 months’ time. And then we’re effectively debt free. That’s our position.”

When asked to comment on this latest Macquairie arrangement, which the club completed on November 23, these are the questions The Watford Observer put to the club:

  • At the fans forum it was made clear there was a financial plan that would have included cash-flow forecasts. Has that plan unfolded as expected, or have there been any major things that haven’t gone to plan?
  • Did the plans you had in the summer include having to take any additional loans?
  • Most people took the statement about being ‘debt free’ by end of June 2024 to mean that. Now there is a new loan, were those statements over ambitious or – at worst – false?
  • An advance like this is a sort of invoice finance (called factoring), and although this debt would be viewed as basically being repaid by a third party (Marseille), it will still show in the annual accounts as debt. If that explains the potential misunderstanding of the club being debt-free in summer 2024, do you think the statements made at the fan forum were misleading?
  • The new loan suggests the club needed Sarr transfer money sooner than it was due from Marseille. Can you give an indication of how this advance will be used?
  • Can you provide an update of non-owner debt that will show in the June 30 2023 accounts, and what you anticipate the equivalent figure will be on June 30 2024?

In response, a spokesperson said: “The club made a commercial decision in taking on an industry-standard factoring arrangement, whereby all the transfer instalments of a player the club sold are paid to the club immediately.

"This factoring arrangement is classified as a debt but the reality is that the buying club, and not Watford, is the one responsible for paying the debt back in accordance with the transfer agreement payment schedule.

“As previously stated, by the summer of 2024 the Macquarie loans will be fully repaid and - save for the owner debt at holdco level - the club will be free of any other debt."