Liverpool's financial report for the year ending in May 2016 was released this week, with the club posting a profit of around £39 million.

Back in 2011, when owners Fenway Sports Group had first taken over the reins, the figure was a £50 million loss, whilst even for the year ending in May 2015, it was a loss of £21 million.

It is a stark contrast to the financial situation Liverpool found themselves in under the previous regime of Tom Hicks and George Gillett, when the club was on the verge of administration and in one of the darkest moments in the history of the institution.

This time around, overall revenue shot up by just over 20%; television money increased by £30 million and commercial revenue by £20 million due to 12 new sponsors. The new kit, a special edition for Liverpool's 125th anniversary, sold in record numbers, with New Balance’s design certainly a hit with fans.

Andy Hughes, Liverpool's chief operating officer, said: “Progress on and off the pitch is critical to the growth of this football club – we all want success and everything we’re doing is geared towards fulfilling our football ambitions.”

Of course, for all the good signs off the field, trophies are the only real success that matter to supporters. Silverware needs to follow, with only one trophy won throughout Fenway Sports Group’s tenure – the League Cup in 2012.

Money is generally considered the quickest way to success in modern football, and even though Liverpool's owners will not be competing on that front with the likes of Manchester City, who are on another level financially, closing the gap is key.

Investing smartly in the right areas is also crucial to the club’s sustainability.

Anfield Road End expansion

The new Main Stand, completed in 2016, has taken Anfield’s capacity to around 54,000, and has been a major success. It adds £1 million per game to revenue, approximately a 50% increase on the situation before it was built, and means more fans getting into the ground.

There is also the new retail store outside Anfield plus a new pitch, something that was in the pipeline as far back as Brendan Rodgers’ tenure.

The total spend on Anfield renovation so far is around £200 million, with the infrastructure massively enhanced, but more can be done.

Anfield still needs to be bigger to fulfil demand. Expanding the Anfield Road End of the stadium is the next step, with around 50 designs reportedly under consideration for doing so.

Fenway Sports Group have always maintained that further expansion would be dependent on the success of the Main Stand, with no commitment made until that was completed. Now the success of that has been revealed, though, there is no excuse not to press on.

The idea is to complete a new training ground first, and then begin work on expanding Anfield further, meaning it will be a number of years before further extension comes to fruition, but the expectation is that it is a matter of when rather than if the building work will take place.

New training ground

A state-of-the-art training centre is the next building project in line for completion, with the acquisition of 14 acres of land next to their existing Academy site in Kirkby already agreed. That will take the footprint of the land owned by the club to 60 acres in total.

Around a £50 million investment will be made to bring the first team to the existing Academy facilities, literally bringing the first team and the youth setup closer together, making the transition between the two smoother.

The likes of Rafa Camacho and Curtis Jones, two recent players to make the step up to training with the first team, will in future only have a short hop onto the pitch adjacent to where they normally train, rather than a quarter of an hour drive.

This investment is only possible because of good financial health, and the club hope it will benefit youth players looking to make the grade for decades to come.

It should be completed by the summer of 2020, ready for Liverpool's first team to to move in for pre-season training as they prepare for the 2020/21 season.

Transfers

Last, but certainly not least, investment in the playing staff is the most pressing concern.

The accounts revealed that £91 million was spent on the acquisition of players such as Gini Wijnaldum, who arrived from Newcastle United, and Joel Matip, who was signed from Schalke 04.

Next summer, that outlay is almost certain to be topped as Jurgen Klopp seeks top level players to take his side to the next echelon of the Premier League.

The accounts showed an 8% increase in the wage bill, which includes all employees from players to ground staff, and that will need to rise again to attract the elite players, with new contracts for Roberto Firmino, Sadio Mané and Mo Salah likely to be on the horizon too.

Liverpool will still need to be sensible with purchases, and will seek value in the market, just as they did when signing Salah for £36 million, a bargain in today’s climate, but can afford to go to the next level with transfer fees. To compete at the very top, that is a must.

The most important thing is that Liverpool win trophies, and the first two things contribute in their own small ways, but transfers are the most significant contributor to success on the field.

The Reds are now in a position to challenge, as shown by the £75 million capture of Virgil van Dijk from Southampton, and must continue to capitalise.

Financial stability is one thing, but making the most of it is now the biggest challenge. Liverpool must now put their rude financial health to the best possible use.