Bristol City have highlighted a growing wage bill as the chief cause behind a £1,997,779 loss for the 2007/08 season.
The march of Gary Johnson's men to the Championship play-offs helped turnover double from £4.3m to £8.8m - but staff costs rose from £5.6m to £8.5m.
It more than doubles the £882,148 loss from the previous financial year.
City chairman Steve Lansdown said: "Competing in the Championship has brought its own problems, in particular, controlling the wage bill."
Lansdown told the club website: "Everyone focuses on transfer activity when talking about improving the playing squad but an equally important element of this is the renegotiation of contracts with existing players.
"It is going to be increasingly difficult to keep wages under control if we wish to progress as a football club""In fact, one of our biggest challenges is managing player expectation whilst at the same time providing the appropriate incentives.
"This also applies to all members of staff throughout the group.
"What we will work hard to ensure is that we use every means available to bring in quality players at the best possible price and reward as much as possible on a performance-related basis."
The club will hold their AGM on 27 November, open to shareholders and members of the Supporters Club and Supporters Trust.
Lansdown said: "Both these organisations are club shareholders and I believe it is essential to open up discussion on how the club is run and what the future holds to the members and individual shareholders."
The City chairman also further outlined the club's plans to build a new stadium at Ashton Vale.
"I am pleased to report that this project is progressing satisfactorily," he said. "It is vitally important for the success of the football club that such a project is successful."
The club has invited the public to have their say on the stadium plans during an exhibition from 5-8 November.
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