Sunderland have recorded a loss before tax of £27.9m, latest figures have revealed.
The annual report and financial statements of Sunderland Limited for the year ended July 31, 2010 show losses rose by £1.4million on the previous year.
Turnover increased from £64.6million to £65.4million, but the club's investment in the playing squad in a bid to retain its Barclays Premier League status pushed it further into the red.
Gross transfer fees of £28million, excluding wages, were committed during the summer, although neither a club record £13million swoop for striker Asamoah Gyan nor the sales of Kenwyne Jones to Stoke, Marton Fulop to Ipswich or Martyn Waghorn to Leicester are included in the figures.
In addition, they stand to receive a total of £24million from Aston Villa for striker Darren Bent following his January move away from Wearside, while Stephane Sessegnon joined from Paris St Germain for £6million and Sulley Muntari arrived on loan from Inter Milan with a view to completing a permanent transfer during the summer of this year.
The report says: "The directors consider the major risk of the business to be a significant period of absence from the FA Premier League.
"Ongoing investment in the playing squad aims to reduce this risk."
A loan of £19million from owner Ellis Short was capitalised - or transferred into shares - in November 2009, and the Texan has since injected interest free-loans of £22.4million and £6million and promised his continued support.
Wages accounted for £46.63million, a rise of £2.5million on the previous year, while the club's directors were paid a total of £1.12million, a fall of £821,000.
The highest-paid director - who is not named in the report - collected £325,678, down from £888,142.
Chairman Niall Quinn has been vociferous in recent weeks over those fans who choose to watch the club's home games via illegal broadcasts in the city's pubs.
The figures show that gate receipts fell from £13.88million in 2009 to £12.6million during the reporting period, although television and media payments increased by almost £4million.
Sunderland currently sit in seventh place in the Barclays Premier League, but have faltered slightly in recent weeks on the back of three successive league defeats.