Hypothetical question re: FFP and transfer fees we might receive this month

[Brighton Breezy]

With the club likely to post losses of at least £8million in the next set of accounts and the threat of FFP looming ever large, would it be a sensible move to put the large majority of any cash received this month into keeping that figure down?

It might seem slightly defeatist in the short-term but next year could be a good opportunity to push on and really compete at the very top end of this division, with a host of clubs likely to be hit with fines, transfer embargoes etc.

We could enter the new season with money from the fines dished out elsewhere, a nice little transfer/wages pot and facing a host of rivals who are in a significantly weakened position.

Not an expert on FFP by any means. Just a thought.

 

[Ernest]

Why bother when all the other teams aren't bothering with it ?

 

[Nathan]

The problem will be actually receiving that money to then be able to spend it. I think the start of the football season and reporting year ends for most clubs are different dates. But i could be wrong.

 

[KZNSeagull]

- clubs staying in the division will only get embargoes, not fines.
- we may never get any money from fines as they may end up going to charity!
- the first FFP "reporting season" is at the end of the calendar year, not season.

 

[Husty]

No one else is bothering to.

 

[El Presidente]

With the club likely to post losses of at least £8million in the next set of accounts and the threat of FFP looming ever large, would it be a sensible move to put the large majority of any cash received this month into keeping that figure down?

It might seem slightly defeatist in the short-term but next year could be a good opportunity to push on and really compete at the very top end of this division, with a host of clubs likely to be hit with fines, transfer embargoes etc.

We could enter the new season with money from the fines dished out elsewhere, a nice little transfer/wages pot and facing a host of rivals who are in a significantly weakened position.

Not an expert on FFP by any means. Just a thought.

1: The losses will be far far higher than £8 million.
2: The fines and embargoes don't start until January 2015, there are NO sanctions for failing to comply with FFP for the year ended 30 June 2014.
3: The fines (when they do kick in) are now being donated to charity rather than being redistributed to those clubs that do comply.

 

[Machiavelli]

1: The losses will be far far higher than £8 million.

Please explain. My interpretation is that they'll be lower, so I'm interested in how you've arrived at this conclusion.

 

[GingerBeerMan]

"Fines" won't happen. It's not thought through and I bet there are some loopholes that the clubs will fight the Football League with. The clubs signed up to an agreement where fines were re-distributed. The Football League then said, at the drop of a hat, these fines were going to charity. This isn't the agreement signed by some clubs, who could say therefore it's void. There will be many loopholes, and we're going to suffer because of it.

 

[sparkie]

Please explain. My interpretation is that they'll be lower, so I'm interested in how you've arrived at this conclusion.

The next accounts are for Amex year 2, not this season.

 

[El Presidente]

Please explain. My interpretation is that they'll be lower, so I'm interested in how you've arrived at this conclusion.

1:No depreciation on the stadium was charged last year, but in this year's accounts it will be £4-5 million (doesn't count for FFP though).

2: We gave contracts to ex-Prem players in the form of PIG, Bridge and Upson, even if we paid 10% of Bridge's City salary it is still £9,000 a week. In addition to that we had a number of existing players sign new contracts. All of the above would push up the wage bill. We also signed Ulloa for £2 million, and his wages will kick in.

3: There is a possibility (no one knows for sure) that the management team who were dismissed may have received a payoff.

4: Some costs in relation to the training ground could have been charged against profits.

5: Losses on the sale of Harley.

 

[nwgull]

I've always got the impression that the club has been on target to meet it's FFP requirements this season without any additional transfer money for potentially selling players in Jan taken into account. For example: it was announced that, thanks to PB's work, the playing budget was higher than they were initially hoping to be able to give Oscar; they wouldn't have done this at the risk of exceeding FFP thresholds.

As such, I'd expect a good proportion of any transfer fees received to be reinvested into the playing side (if we do actually sell any players).

 

[Husty]

3: There is a possibility (no one knows for sure) that the management team who were dismissed may have received a payoff.

Would that sort of thing have to be reported in detail in the accounts?

 

[Weststander]

Leicester and Forest stand out as clubs completely disregarding the rules, in a desperate one-off bid to grab PL riches. Where the FL penalty which would still be payable, but small in comparison to PL income. This gives them both now far better squads than their attendance income would warrant (no better than Leeds, Brighton and Derby, in broad terms you would say), in what Wenger labelled "financial doping" ... the results and league positions of Forest and Leicester have been achieved by cheating.

The rules are in black and white, not complicated, and the audited accounts of each club would be signed off by completely independent auditors preventing manipulation of the figures by clubs. I'd love both Leicester and Forest to fail to gain promotion this season. The other 70 league clubs would not let them off the hook, and the substantial £m penalties would be shared out amongst the abiding clubs.

 

[El Presidente]

Would that sort of thing have to be reported in detail in the accounts?

It depends on the amount. For example, when MUFC reported their results, it included a cost of £6 million for payoffs to SAF's backroom staff who were not wanted by Moyes (including our ex goalkeeper Eric Steele).

 

[Weststander]

Would that sort of thing have to be reported in detail in the accounts?

Only if directors, or if an exceptional amount. But

There is no payout for gross misconduct, so Poyet and Oatway wouldn't have got one.
Taricco was by mutual consent, as he was planning his lucrative next job with Poyet.

 

[Husty]

Leicester and Forest stand out as clubs completely disregarding the rules, in a desperate one-off bid to grab PL riches. Where the FL penalty which would still be payable, would be small in comparison. This gives them both far better squads than their attendance income would warrant (no better than Leeds, Brighton and Derby, in broad terms you would say), in what Wenger labelled "financial doping" ... the results and league positions of Forest and Leicester have been achieved by cheating.

The rules are in black and white, not complicated, and the audited accounts of each club would be signed off by completely independent auditors preventing manipulation of the figures by clubs. I'd love both Leicester and Forest to fail to gain promotion this season. The other 70 league clubs would not let them off the hook, and the substantial £m penalties would be shared out amongst the abiding clubs.

 

[B.W.]

1:No depreciation on the stadium was charged last year, but in this year's accounts it will be £4-5 million (doesn't count for FFP though).

2: We gave contracts to ex-Prem players in the form of PIG, Bridge and Upson, even if we paid 10% of Bridge's City salary it is still £9,000 a week. In addition to that we had a number of existing players sign new contracts. All of the above would push up the wage bill. We also signed Ulloa for £2 million, and his wages will kick in.

3: There is a possibility (no one knows for sure) that the management team who were dismissed may have received a payoff.

4: Some costs in relation to the training ground could have been charged against profits.

5: Losses on the sale of Harley.

3 - Gus got nowt.

 

[S'hampton Seagull]

1:No depreciation on the stadium was charged last year, but in this year's accounts it will be £4-5 million (doesn't count for FFP though).

2: We gave contracts to ex-Prem players in the form of PIG, Bridge and Upson, even if we paid 10% of Bridge's City salary it is still £9,000 a week. In addition to that we had a number of existing players sign new contracts. All of the above would push up the wage bill. We also signed Ulloa for £2 million, and his wages will kick in.

3: There is a possibility (no one knows for sure) that the management team who were dismissed may have received a payoff.

4: Some costs in relation to the training ground could have been charged against profits.

5: Losses on the sale of Harley.

Outside of depreciation I assume our losses will be less than £8m as Barber said the budget for this season had increased slightly.

 

[Weststander]

3 - Gus got nowt.

Exactly

 

[brightn'ove]

FFP will be ruled unlawful by the ECJ soon enough.