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Manchester City has reported an annual loss of £194.9m for 2010-11, the biggest in English football history.

But the operating loss does not include the club's huge sponsorship deal with Etihad Airlines, worth a reported £35m a year, or revenues from this season's Champions League campaign.

Uefa's Financial Fair Play rules, which come into full effect in 2013-14, say clubs must break even over three years.

However fall outside the accounting window for that.

The previous biggest Premier League loss was £141m reported by Chelsea in 2005 - when they went on to win the league.

The scale of City's losses reflect the investments made by owner Sheikh Mansour of Abu Dhabi, who has spent more than £460m on players since taking over the club in 2008.

Since then, City have been transformed into the current Premier League leaders.

Brian Marwood, chief football operations officer at the club, told the ����ý: "We know that we still have an awful lot of work to do but I think it's exactly where we said we would be in terms of the initial investment.

"Over a period of time we are fully aware we have to be compliant and there's a lot of work going on to make sure that's achieved."

He added that the club was working with Uefa all the time and was "comfortable" with the governing body's new rules.

'No repeat'

It is the second year in a row that City has made big losses. In 2009-10, it reported an operating loss of £126m.

But chief operating officer Graham Wallace said the losses "will not be repeated on this scale in the future".

Turnover hit £153.2m, up from £125.1m in 2009-10.

This was driven by a 49% jump in commercial partnership revenue to £48.5m.

Income from television rights rose by 27.4% to £68.8m, thanks largely to the club's third-place finish in the Premier League, winning the FA Cup and a run to the last 16 of the Europa League.

Match day ticket sales were up 8.2% to £19.7m.

But wage costs continue to exceed turnover, rising from £133m in 2009-10 to £174m in 2010-11.

Abu Dhabi concerns

Although City's results next year will be boosted by the 10-year sponsorship deal with UAE's Etihad, questions have been raised about the £400m agreement.

Etihad is based in Abu Dhabi, which is also the home of Sheikh Mansour, a member of the emirate's ruling Al-Nahyan family.

Concerns have been raised that the deal has been inflated to help City meet Uefa's financial fair play rules.

Liverpool managing director Ian Ayre has said: "Are Etihad, City and Sheikh Mansour related parties? If they are, it's up to Uefa to rule on them."

Arsenal manager Arsene Wenger has also claimed the deal "raises the real question about the credibility of financial fair play".

Uefa has confirmed it is looking at the deal to see if the club is taking advantage of its links with Abu Dhabi to circumvent its strict new financial rules.