Queen of the South Football Club has conceded that its latest accounts and expected figures for the current season ‘casts significant doubt’ to whether the club can continue to run.
Queens accounts for the year to 31st May 2010 show a £1.2m loss, up from £750,000 the previous year as well as net assets falling to £82,000, having previously been worth £500,000.
The club has also suffered cash flow issues this season following a number of postponements in its fixture list, with Queens expecting further losses this season.
The club’s financial statement said: "The unaudited results of the current year indicate there will be a further significant loss for the year ending 31st May 2011 which could result in the company's balance sheet showing net liabilities at that date.
"The directors recognise that the combination of circumstances outlined above represents a material uncertainty which casts significant doubt upon the company's ability to continue as a going concern."
But the statement did reveal hopes of retuning the club, who play in the Irn Bru Scottish Football League Division One, to profitability in the future.
"On the basis that support from directors, creditors and investors will continue in the short to medium term and that the directors have plans in place which they believe will return the company to profitability and positive cash flow in the longer term," the statement said.
Queens is one of a number of Scottish club who suffered postponements due to the snow and cold conditions in December.