A CASH-STRAPPED football club which spent more than its total income on wages has been cleared of breaking any league rules.

The Northern Echo revealed last week that Darlington Football Club’s 2006-7 accounts showed the club had spent 110 per cent of its turnover on staff costs.

The accounts, which run up to October 2007 and are the most recent available, show a £2.6m annual turnover and wages of nearly £3m.

The Football League introduced the Salary Cost Management Protocol (SCMP) in 2003 to cap spending in Division Three – now League Two.

The agreement, which was signed by all 24 clubs, limited spending on player wages to 60 per cent of club turnover and total salary costs to 75 per cent of revenue.

Although the Football League continually monitors clubs’ spending, it passed the accounts to its finance department to investigate.

A league spokesman said yesterday it was content the club had complied with the SCMP.

He said: “The definitions of turnover and employee costs used when producing annual accounts vary from those included in the SCMP. For example, equity injections are counted as turnover.”

The accounts showed the club also spent £2.1m on other, non-defined, charges.

Taking into account depreciation of assets, other minor operating income and interest, the club made a £2,662,724 loss up to October 2007, bringing total debt to £5,157,313, which included a £3.1m loan from then chairman George Houghton.

As a result of the accounts, auditor Charlton Williamson Accountants, warned in December the club could not continue as a going concern.

Two months later, Mr Houghton placed the club in administration, saying it was losing £54,000 a week and was more than £5m in debt.

Administrators were unable to negotiate a deal for the club and its ground and land, which are held separately by Mr Houghton, leading to a threat it may not be able to start next season.

But last week, Mr Houghton said he would return to the club. He was not available for comment last night and is understood to be finalising contracts to bring the club out of administration.

Former club director David Jones said more details were expected next week. The Football League confirmed there was nothing to prevent Mr Houghton returning as chairman, as long as he still passed the fit and proper persons’ test.