Louis van Gaal has been told he is free to break the world transfer record to bring the right player to Manchester United.

Last year Real Madrid set the record by signing Gareth Bale from Tottenham Hotspur for £86m, eclipsing the £80m they had paid United four years earlier for Cristiano Ronaldo. Van Gaal, who will take charge of United for the first time in a friendly against LA Galaxy that kicks off in the early hours of tomorrow morning UK time, has been told his transfer activity will not be constrained by money.

“It’s difficult to deal in hypotheticals based on lots of different things,” Ed Woodward said. “The reality is that we’re not afraid of spending significant amounts of money in the transfer market.”

The club’s executive vice-chairman added: “Whether it’s a record or not doesn’t really resonate with us. What resonates is an elite player that the manager wants who is going to be a star for Manchester United.”

United have already paid £27m for Southampton’s Luke Shaw and £28.5m for Athletic Bilbao’s Ander Herrera. The £37.5m paid to Chelsea for Juan Mata in January is a United club record but Woodward says United will not be put off spending what it takes to secure the players of Van Gaal’s choice. “Of course it’s in our capabilities,” he said. “You guys think about the money in a way that I don’t. I get pointed in the direction of a target that the manager wants and there is an assessment of what that might cost and I’ll negotiate hard to do the best I can on the trade.

“I stand by what I said – there is no budget. We are in a very strong financial position. We can make big signings. That doesn’t mean we go and throw money around. Louis is the manager. We have a lot of scouting output through the last 12 months, flagging up various things to us. Louis is the one that makes the ultimate decision around who he wants in the squad. I’m not going to force feed him with a player that he hasn’t selected.”

Although Van Gaal wants to assess the squad Woodward says no time is being lost with regard to signings. “We’re still looking at options. We’re not sitting on our hands waiting for Louis. He is very good at communicating clearly what he wants.”

With Patrice Evra, Rio Ferdinand and Nemanja Vidic having left, United need at least one central defender, potentially another left-back, and are still chasing another central midfielder despite Herrera’s arrival.