The 2010 financial statements for the companies which run Formula One were released last week and, perhaps unsurprisingly, they led to several inaccurate reports.

The F1 company accounts certainly aren't straightforward and easy mistakes can be made by journalists who rush out their reports or don't understand the business behind the sport. Pitpass' business editor is on hand to set the record straight and, as he reveals in a report in the Daily Mail, F1's fortunes are stuck in reverse thanks to the recent recession.

Pitpass has already explained in some detail the deep flaws in one of the assessments of the accounts - that of Telegraph sports reporter Tom Cary who wrote that "Formula One has seemingly defied the economic downturn after announcing turnover once again in excess of $1billion (£610 million) for 2010.". Cary's comment is laughable and demonstrates to editors why it is risky for sports journalists to cover business issues.

All of the key F1 companies filed their accounts last week but the figure Cary is referring to is the amount of money which flowed into the coffers of Formula One Administration (FOA) the company which directly owned the rights to F1 in 2010. FOA's revenue increased by £11.6m ($19m) to £661m ($1,082m) and contrary to Cary's understanding, there is very, very little positive about this. In fact, the increase suggests that F1 was so badly hammered by the recession that not only did it have to waive the 10% escalator which is usually applied to its race hosting fees every year, but several of FOA's clients didn't pay up. It's pretty easy to see that this is the case if you know where to look and Sylt does.

Let's start at the beginning. FOA gets it money from three key sources - TV stations, which pay to broadcast F1, sponsors which pay to be known as F1's official partners, and circuits, which pay to host F1 races. According to F1's industry monitor, Formula Money, TV contracts bring in around £275m ($450m) with £61m ($100m) coming from sponsorship and £325m ($532m) from race hosting fees. This makes up FOA's £661m ($1,082m) of revenue.

As any seasoned F1 business reporter will know, escalator clauses in the race hosting contracts increase the fee paid by 10% each year. This alone should have increased FOA's revenue by around £30m ($50m) and, of course, last year new races in Canada and South Korea were added to the calendar. These two events are believed to have annual fees totalling £37m ($60m). That's a total of £67m ($110m) in additional revenue which FOA should have got without its boss Bernie Ecclestone even lifting a finger. However, instead, its revenue only increased by £11.6m ($19m). It certainly doesn't fit the 'economic downturn defying' picture painted by Cary.

He didn't have to look far to find evidence that FOA still hadn't raced out of the recession as FOA's chief financial officer Duncan Llowarch writes in the accounts that the revenue from the new races "more than offset the impact on certain revenues of the continuing effects of the global economic downturn."

Indeed, to show just how bad FOA's latest financial results are, just consider that in 2009, when there was one less race than the previous year, the company's revenue rose by £51.3m ($84m) - far more than the increase in 2010 when two races were added to the calendar. Revenue in 2009 increased by 9% which is no surprise given the 10% escalator on the race hosting fees. The increase last year came to 2% which is the evidence that escalator clauses were waived and, most probably, several clients failed to pay FOA what they were due. It wouldn't be the first time that this has happened as the 2009 accounts for FOA's parent company Delta 3 revealed that £13.4m ($22m) in fees were still outstanding for the Canadian Grand Prix from 2006 to 2008.