The question is: Did they?
A Tartan Army foot soldier wasn't sure and sent this email to the SFA:
A bit of back story may help. I was a committed tartan army man, missed 5 home games in 20 years, though not always a card holding member of tartan army. But a big part of my support for the national team died when Walter Smith left us during the campaign. I honestly couldn't believe it and it still rankles 5 years on. I've gone over the published accounts of Rangers every year looking for the £400,000 compensation payment that the SFA negotiated. But I've never seen any sign of it. I also checked the published creditor list that Duff & Phelps made public, thinking perhaps the payment was still to be made. But there was no listing of yourselves to the tune of £400,000. Which is an enormous amount of money, but nothing compared to us qualifying which I'm sure he would have accomplished. Really I'm looking for someone at the SFA to supply documented proof positive that this money was paid. I've spoken to a few tartan army boys about it and they're very curious also and had just assumed it to be settled. . Many thanks for your assistance in this matter"
Looking at the RFC accounts from the subsequent years, there is no record of any such payment, staggered or otherwise.
RFC 2007 accounts http://www.rangers.co.uk/index.php/club/shareholders/item/download/8_74207668d5bb80ab4797b36213bcb2f6 RFC 2008 accounts http://www.rangers.co.uk/index.php/club/shareholders/item/download/14_4b4314d272b0efc3c4e3335bdb1d0e56 RFC 2009 annual report http://www.rangers.co.uk/index.php/club/shareholders/item/download/10_bcb3b0419d29cbdedf758252f787221c RFC 2010 annual report http://www.rangers.co.uk/index.php/club/shareholders/item/download/11_d3a9cebfa14973131a304f4cd27b0e2cYet this was Mark Snell's reply:Hi XXXX I can confirm that compensation was paid by Rangers for the release of Walter Smith from his contract with the Scottish Football Association. We cannot disclose details of confidential contracts. Regards, Mark Snell Communications Executive The Scottish Football Association Tel: +44 (0)141 616 6029 Mob: + 44 (0)7904 604 943 Fax: +44 (0)141 616 6001 Email: email@example.comSo nothing in the accounts, not in the list of creditors but SFA confirm it was paid. If so, when? how? and by whom?Scotland deserves to know.