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Data Analysis for Accountants: Assessment

Today’s Date: 15/3/2023

Name: Reef
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TITLE:
What is the relationship between Squad Value and Total Revenue among UEFA
Champions League teams?

ABSTRACT:

The purpose for the research was to find out whether the correlation between the

Squad Value and Total Revenue among UEFA Champions League teams is positive

or negative. The methods used include, line of best fit in scatter graph, regression

analysis, and correlation. The findings were that Real Madrid FC which has a Squad

Value of 874 made 681 in total revenue while FC Porto which had the lowest squad

value of 214 made only 87. The answer to the research question is that teams with

higher squad value have bigger the total revenue in general.

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Data Analysis for Accountants: Assessment

INTRODUCTION:

In this analysis the focus was comparing UEFA Champion league’s teams Squad

Value to their Total Revenue from the data supplied by the KPMG Sports Advisory

Practice in January 2021.The two main variables mentioned above, i.e., Squad

Value and Total revenue, were correlated with the purpose of finding out whether the

correlation between the them is positive or negative.

DATA AND METHODS:

The columns chosen for this research were the Total Revenue column (B2 to B7)

and the Squad Value column (G2 to G7). The data on these columns was chosen

because it contained the necessary data to carry out the correlation as explained in

the introduction.

One method of understanding the relationship between UEFA Champion league

teams’ Squad Value and Total Revenue is the line of best fit from scatter graph. For

more reliable results, regression analysis was used to find the line of best fit.

Another method used is correlation, whereby changes in one variable tend to go

together with changes in the other, and it can be positive or negative.

FINDINGS:

The analysis expectation was that the team that had the highest squad value would

also generate the most total revenue. In the analysis, the correlation coefficient was
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Data Analysis for Accountants: Assessment

0.905. This figure shows that there is a huge positive correlation between how high a

team’s squad is valued and how much revenue the team makes. For example, Real

Madrid FC which has a Squad Value of 874 made 681 in total revenue, while FC

Porto which has the lowest squad value of 214 made only 87. This corresponds to

the scatter graph which shows teams with high squad value have higher total

revenue in general. However, what is rather remarkable is that the team with the

highest squad value of 1094, i.e., Liverpool FC was third in terms of total revenue,

the top team being Real Madrid FC which is third in terms of squad value at 874. All

in all, it is evident that teams with higher squad value have bigger the total revenue.

CONCLUSION:

The conclusion made in this research is that the higher the team squad value is the

higher the chances of a UEFA Champions league team total revenue being bigger.

Therefore, the it is okay, to a certain extent, to theorize that the higher the squad

value of a UEFA Champions league team is, the higher the total revenue will be.

This is because according to the scatter graph, the teams having higher squad value

in the league have more chances of making more total revenue than those ranked

lowest.
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Data Analysis for Accountants: Assessment

REFERENCES:

KPMG Sports Advisory Practice, January 2021

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Data Analysis for Accountants: Assessment 1

APPENDIX:

Fig 1:

Squad Value vs Total Revenue

800
700
f(x)==0.819003029783598
R² 0.637339478022098 x − 16.8501139011923
600
500
Total Revenue

400
300
200
100
0
0 200 400 600 800 1000 1200
Squad Value

Fig 2:

Fig 3:

Total Revenue Total Staff Costs Pre-tax profit/loss Average attendance Capacity Squad Value Facebook Instagram Twitter YouTube TikTok Weibo X Y
FC Bayern Munchen 607 315 11.7 75000 75000 944 51.4 24.8 5.2 1.9 3.8 4.4 944 607
FC Porto 87 91 -116 35625 50000 214 4.1 1.6 1.3 0.2 0.2 0.01 214 87
Juventus FC 401 284 -81.7 39691 41507 735 43.5 45.5 8.7 3.1 1.9 3.1 735 401
Liverpool FC 557 N/A N/A 53143 53394 1094 37.1 29.3 16.2 5.4 3.5 3.4 1094 557
Paris Saint-Germain FC 541 406 -127 47517 48712 807 41.9 32.5 8.5 2.7 3.7 2.2 807 541
Real Madrid CF 681 411 1.9 66875 81044 874 111 94.4 35.7 6.2 4.1 4.4 874 681