West Ham's financial woes were laid bare on Monday night when the club published their latest accounts.
The club's decision to award injury-plagued striker Dean Ashton a new contract in December 2008 backfired, leaving them liable for a £5.81million payment when he was forced to retire in December.
Freddie Ljungberg and Kieron Dyer will have cost the club £34million over the terms of their contracts, having only started a combined total of 32 matches for West Ham since the summer of 2007.
For two years under the ill-fated Icelandic regime, West Ham's wages totalled around 80% of their annual turnover, nearly 20% higher than the Barclays Premier League average.
The club's finance director, Nick Igoe, wrote in the accounts that the club's subsequent on-field performances were unsatisfactory following such major investment.
"It is a truism to observe that a club's playing success (and almost certainly long-term financial success) is largely dependent on how wisely it invests its available resources," Igoe wrote.
"It has to be concluded that many of the group's investment decisions in the last two to three seasons have been ill-judged.
"Two players who signed in the summer 2007 transfer window, one of whom has since left the club, have started a combined total of 32 games and will have cost the group £34million over the term of their contracts. No football club can sustain this level of expenditure on underperforming members of its squad.
"It must be concluded that the investment in the playing squad has not generated an appropriate return, either financially or in terms of performance. It follows that an eighth and 10th-place league finish, one Carling Cup last eight and one FA Cup last 16 represent an unsatisfactory return on this expenditure.
"Clubs with fewer resources and lower levels of expenditure on their squad have achieved a greater level of league and cup success."
The figures also reveal the major belt-tightening programme West Ham undertook last season in the hope of staving off financial meltdown. The wage bill was reduced and West Ham made £10.8million from player sales - but that accounted for less than a quarter of the transfer expenditure from the previous two seasons.
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