Chelsea FC has revealed a £65.7m loss for the financial year to June 2008.

£23m was shelled out in compensation to former managers and five coaches including Jose Mourinho and Avram Grant.

The figures do not take into account the sacking of Luiz Felipe Scolari, who was axed from the west London club this week. It has been estimated the Brazilian could walk away with £8m.

Abramovich losses - investment changed

Stanford Bridges banker Roman Abramovich will add the losses to the estimated $20bn he shed due to the credit crunch.

The Russian has invested over £700m in the blues but has spent almost the last two years throphyless.

Fans will however be encouraged after the billionaire changed to interest-free loans to the club into shares in a sign of continuing commitment to Chelsea.

'Strong business base'

The club has reiterated its intention "to require zero cash funding from the owner (Roman Abramovich) at the beginning of the financial year 2009/2010".

Chelsea chief executive Peter Kenyon added:

"There is no doubt that the positive upward trends of turnover and the continued reduction in losses shows that Chelsea is building a strong business base to build on in what will be challenging times.

"This is even more evident given that the results were adversely affected by the exceptional items."

Transfers funded by sales – power shift

In a sign of the times Kenyon said that all transfers this summer will be financed by sales.

It is all far cry from the tens of millions splashed about in the trophy laden seasons of the mid 2000s.

The arrival of Arab wealth to Manchester City in the form of the Abu Dhabi United consortium saw the financial clout of the Premiership shift decisively north.

They hijacked Chelsea's bid for Real Madrid's Robinho just minutes before the summer transfer window closed in a British record transfer fee of £32.5 million. Last month the club also had a world record £100m bid for Brazilian Kaka rejected.

English clubs attacked for debt

English clubs have been attacked by their European rivals and UEFA for having high levels of debt, something Chelsea are now trying to address.

Chelsea improved on the £74m lost last year and £80.2m in 2006/7. In 2004/2005 it lost £140m.

The club came fifth on the list of the world's richest clubs in 2007/8 - behind Real Madrid, Manchester United, Barcelona and Bayern Munich.