UEFA have warned Europe's top sides they must comply with their "indirect salary cap" and have used Arsenal as an example of a well-run club.
UEFA's latest figures show that financial problems affecting European clubs are getting worse, with spending on player wages up almost 10% - and increasing at a faster rate than income.
Under their new rules, clubs will face possible bans from European competition from the 2014/15 season if they spend more than they earn over a three-year period.
UEFA's general secretary Gianni Infantino held up Arsenal as an example of a well-run club who have boosted their income without ever overspending.
He said: "Ten years ago Arsenal reported less income than Chelsea, Liverpool and Newcastle. Now it is more than those clubs and in 2009 more than double Newcastle's.
"This shows what is possible with good management and careful investment.
"What kind of healthy business model is it to wait for a knight rider on a horse with a lot of money to throw around and then one day jump back on his horse and ride away?"
He used the example of Scottish club Gretna to illustrate the danger of a rich benefactor spending heavily initially then leaving a club in peril.
Infantino admitted the new rules are targeted at the amount spent by clubs on players' wages.
"It is about better cost management, in particular the wages of players - it is an indirect salary cap."
Manchester City's recent £121million losses mean they are the club in England facing the greatest difficulty to abide by the rules - even though owners are also allowed to inject £12million a year (15m euro) into their side.
They are one of 11 clubs competing in Europe this season that would fall foul of the rules were they in force now.
Leading Italian clubs also face problems but UEFA president Michel Platini said whatever their stature, the European governing body would not hesitate to take action.
Platini, speaking at UEFA's headquarters in Nyon, Switzerland, said: "If a club doesn't fall in line and follow the same rules as everyone else then it will be time to face the music.
"Certainly it is not something we want to see.
"Our objective is not to put clubs into financial difficulty. Financial fair play is to help them escape from this devilish spiral and have a viable economic strategy in the long term. I will leave no stone unturned to do this.
"This is not a witch-hunt, this is so they no longer continue blindly and mindlessly."
Manchester City have already sent officials to meet UEFA about complying with the financial rules.
Andrea Traverso, UEFA's head of licensing, said: "We are in talks with the club - they are aware of the rules and they probably have a strategy to raise their income.
"They have been to see us and they are confident that they can manage this challenge."
