Graphic: this is Anfield - in debt

More than any ordinary business — and we know that football is not that — the “going concern” question is a sensitive one for top European clubs.

For Liverpool, it is vital not only to their future as a solvent company but also their continued participation in the Champions League, on which they rely increasingly for the income to service their burgeoning debt.

It is a delicate situation. Uefa, which runs the Champions League, demands that clubs provide detailed financial forecasts before it will issue them with a licence to compete in its competitions.

But, despite worrying levels of debt and the caveat from their auditor at KPMG about their ability to remain solvent, George Gillett Jr and Tom Hicks, the co-owners, must have done enough to convince Uefa that Liverpool will not go bankrupt halfway through next season or the club would already have been thrown out of Europe.

Given the continued reluctance of banks to lend money in the recession, the language of Liverpool’s accountants is not wholly unexpected. Auditors are required by financial regulators to make their assessments about whether a company is a going concern on the assumption that it can stay in business for the next 12 months. Increasingly, confidence in that assumption is low.

Yet the fact that a £350 million credit facility secured by Kop Football (Holdings) Ltd, the club’s holding company, is due for repayment on July 24 is undeniable. So, too, is the lack of a replacement arrangement with RBS and Wachovia, despite the insistence of the owners that there will be one in the coming weeks.

So KPMG has a duty to highlight the “material uncertainty which may cast significant doubt on the company’s ability to continue as a going concern”. Experts say this constitutes a special alert for shareholders — or, in this case, supporters. It is essentially code for “you should be worried about this”.

What is worrying for Liverpool is a basic admission that the club are not generating enough income to cover interest payments totalling £36.5 million and the ambition to attract the biggest — and most expensive — players to Anfield. Staff costs in the 2007-08 season were nearly £90 million.

Even if Gillett and Hicks do successfully renegotiate the soon-to-expire credit facility, there remains the question about their long-term ability to take losses that at the last count were £42.6 million.

There will be continued pressure on the owners’ American sports businesses to prop up Liverpool’s financial house of cards if the credit crunch continues to equal crippling lending terms.

It surely has not helped that they made a dud call on the direction of interest rates, entering into fixed agreements between 4.3 per cent and 6 per cent as the Bank of England cut its rate to a record low of 0.5 per cent. The cost of exiting these hedging agreements would total £30.6 million, prompting KPMG to describe them as “potentially onerous contracts”.

The bottom line is, when they add it all up, will they reckon it is worth it?