Genuine question regarding transfers and money losses

[northstandsteve]

If there are 300 stewards inside the stadium , think of all those outside in the various car parks and the station area , stopping non resident vehicular access to Falmer village and monitoring the controlled parking zones.

Still doesn't add up to 2,000, if catering staff included would still be under 2,000, total, but they are employed by the caterers not the club. No doubt stewarding costs will be evaluated, inline with all other departments in the club.

 

[tinycowboy]

Not necessarily... it actually depends on the clubs accounting policy and they would be justified in recognising and expensing the entire amount in the year of the transfer under IFRS regulation.

Under which IFRS? That would be a pretty severe accounting policy for an intangible asset - the useful life of the asset is the contract period. As long as the player is not injured or deemed to be a bad purchase, it would be unusual to write the asset down to nil like that.

 

[The Large One]

You miss the point - of course all these expenses need be incurred but I have no idea as to their quantum whereas we can speculate on income.

My point is that BHA has more income than most in Championship so £8m loss means we are spending well over £20m pa (if I am anyway near right). Just seems a lot, that is all. It ain't complicated.

If you don't like speculation, NSC is not the place for you.

'Seems' a lot? It either is or it isn't.

Read the accounts, they've been published and digested on here already.

 

[Seagull on the wing]

It's a good question that has had me foxed. The average gate last season was 26.2k. Guess average price is £25, so League attendances raised £15m, plus cup and PO match, say £16m, less VAT = £13.3m net. This is more than double most Championship clubs.

AND from what Barber says about take up of food and drink, there must be a big addition here. If average spend is £10, that is 10 x 26.2 x 25 matches = £6.6m. Margin is difficult as beer margins are low but I would hazard £1.5m overall, so total from gates plus catering around £15m.

The point about matchday staffing is fair but let's say we have 500 more than we need. Guess they get about £45 (6 hours x c.£7.50) per match shift, plus oncosts say £50. 500 x £50 x 25 matches = £625k, not a large proportion of the gate revenue.

So where does it all go? Have no insight on this, only thing to bear in mind that we have had minimal transfer income in, only esimated £1m for Nooney.

Don't forget the TV money....we had quite a few matches on telly....don't know how much we were paid but it must be a substantial sum...

 

[tinycowboy]

The problem with answering the question is that the accounts straddle the transition period between us being a Withdean club and an Amex club. The initial transition is clearly going to cost money, but we've no idea how much of that inevitable extra spend will be recurring and how much won't - either the CEO will tell us, or we'll have to keep on guessing: better to get these things explained by the CFO/CEO in my experience.

 

[SeagullEd]

Under which IFRS? That would be a pretty severe accounting policy for an intangible asset - the useful life of the asset is the contract period. As long as the player is not injured or deemed to be a bad purchase, it would be unusual to write the asset down to nil like that.

Fairly unimportant, but nonetheless...

For an item to be recognized future economic benefits must be expected to flow, and moreover, control over these needs to be established - for some the purchase of the player might constitute adequate control but there is an obvious case against this. (I believe this is all IFRS 16 and 18 type stuff). Similarly, impairment testing is likely to be fairly problematic so if a reliable estimate of economic benefit cannot later be established it may be deemed necessary to do so. I would not be surprised to learn that many clubs expense players fee directly...

Actually, thinking about it (although BHAFC wont have to adhere to IFRS) for most companies no staff cost can recognized as an asset - I wonder where football clubs are on this issue.

 

[tinycowboy]

Fairly unimportant, but nonetheless...

thanks SeagullEd. Well, i'm interested! If there was inconsistent treatment amongst football clubs for capitalising transfer fees (do we know if there is?), they would be completely incomparable. I don't know where FFP stands on this. Back to the accounting, I think this would come under IAS 38. I agree with your point about impairment testing - eg if CMS is out injured, would we take an impairment charge covering the expected period of time spent out? Would Ryan Harley be impaired because he's not regularly playing in the first team? Regarding control, the presence of an enforceable legal contract surely establishes this. You're correct in that it is unusual to capitalise staff (although not in a business combination), but you're not technically capitalising people, but the access you have to utilising their skills through an enforceable legal contract - in the end, though, these amount to pretty much the same thing.

 

[jmsc]

beer margins are low

No they're not.

 

[burnee54]

One thing I can't understand is why are we offering one year contracts to people like Spanish Dave? The man has class written all over him and yet he would be on a free of contract again next year? If he signed for two years and somebody wanted him next summer then at least we would get something back for him to put towards a replacement.
Can somebody explain the logic here?

 

[Tubby-McFat-Fuc]

How is It we have accumulated a 8mil loss along with one of the lowest Transfer budgets In the league

Maybe because our transfer budget was not as low as Pooyet bleated on about........ after all, cost him his job in the end

 

[SeagullSongs]

The travel subsidy must be costing the club a bomb. It costs me £4.25 to get to the Amex and back with a railcard in off-peak times, so that's at least £100 a season, we're getting it for half that. 600,000 people through the gates each season probably saving an average of £5 each, so I'm guessing the club has to pay that extra 3 million?