[Albion] Panic Ye Not on the finances.

[Super Steve Earle]

Tony’s not just a mathematician. He’s a magician too!

A mathemagician?

 

[Greg Bobkin]

It's *almost* like they know what they are doing and are better placed to deal with/worry about the accounts than, I don't know, 'JeffTheSeegul1965' from Pulbrough...

 

[Eeyore]

It's *almost* like they know what they are doing and are better placed to deal with/worry about the accounts than, I don't know, 'JeffTheSeegul1965' from Pulbrough...

Jeff is an authority on the political state of affairs in this country as well as the menace of cyclists and 20mph speed limits though. You can't deny that.

 

[Stato]

And yet we do. We really really do.

Am I right to be hearing that in Frank Sidebottom's voice?

 

[Triggaaar]

Purchases this summer £145m

Are you not out of date already?

 

[ChickenBaltiPie]

Player sale profits
Undav £22m (25-3 book value)
Gross £7.5m (8-0.5 book value)

Can someone please explain the ‘book value’ bit? Thank you

EDIT: Oh, I get it, sale price minus original purchase price?

 

[Baldseagull]

Good question. And also brings the query - do you have to amortise, or can you place the entire cost in one year if you have big sales to offset it? I understand that the assets are on the books so need to be accounted for, but that can hurt you in terms of PSR accounting

I would guess that it is the correct way to do the accounting, it's similar to having a depreciating asset. We hope to have bought appreciating assets, but every player could stay till their contract runs out if they wanted to.

 

[Bozza]

Can someone please explain the ‘book value’ bit? Thank you

EDIT: Oh, I get it, sale price minus original purchase price?

If you buy a player for £20m and give them a 4-year contract, then that £20m is amortised over the course of those four years in a straight-line fashion, ie £5m per year.

So, after the player has been at the club for one year, then his book value will be £15m - £20m-£5m.

When you sell a player, the impact on PSR/FFP will take account any remaining book value.

So if that theoretical £20m player has had a blinding year and Chelsea buy him for £50m, then the PSR impact would be £50m-£15m=£35m.

Players that have come through the youth system, as opposed to being bought, have no book value, hence 100% of the sale proceeds count for PSR purposes. That is why Chelsea were keen to ship out Conor Gallagher as the entire sale proceeds - supposedly £34m - get put in the PSR plus column.

Even though Joao Felix, moving in the other direction, supposedly cost more. the deal will only have a minimal impact on this year's PSR as the transfer fee will be spread over the maximum permissible five years.

 

[dazzer6666]

Can someone please explain the ‘book value’ bit? Thank you

EDIT: Oh, I get it, sale price minus original purchase price?

No. Sale price less unamortised cost

 

[Baldseagull]

Can someone please explain the ‘book value’ bit? Thank you

EDIT: Oh, I get it, sale price minus original purchase price?

I think it's sale price minus what value they had left after amortisation.

 

[Motogull]

But but but this looks like financial doping. Agan.



Its not fair. We should have the book thrown at us.

Why not be fair and show the non financial doping ethically accurate figures for Palace?

Them plonkers will never get it will they?

 

[ChickenBaltiPie]

No. Sale price less unamortised cost

Thank you

I think it's sale price minus what value they had left after amortisation.

Thank you

If you buy a player for £20m and give them a 4-year contract, then that £20m is amortised over the course of those four years in a straight-line fashion, ie £5m per year.

So, after the player has been at the club for one year, then his book value will be £15m - £20m-£5m.

When you sell a player, the impact on PSR/FFP will take account any remaining book value.

So if that theoretical £20m player has had a blinding year and Chelsea buy him for £50m, then the PSR impact would be £50m-£15m=£35m.

Players that have come through the youth system, as opposed to being bought, have no book value, hence 100% of the sale proceeds count for PSR purposes. That is why Chelsea were keen to ship out Conor Gallagher as the entire sale proceeds - supposedly £34m - get put in the PSR plus column.

Even though Joao Felix, moving in the other direction, supposedly cost more. the deal will only have a minimal impact on this year's PSR as the transfer fee will be spread over the maximum permissible five years.

Thank you

 

[Uh_huh_him]

Purchases this summer £145m
Average contract length 4.5 years
Annual amortisation expense £32m

Player sale profits
Undav £22m (25-3 book value)
Gross £7.5m (8-0.5 book value)
Leonard £0.5m
Total £30m

Net transfer cost this season £2m

#TrustInTony

How does the new PSR rules affect us?

I think Revenue last season was around £200m which under the new rules, would have given us £170m to spend on wages/fees/amortisation.
Last season we spent £128m on wages and £32m on amortisation.

On the face of things an extra £32m on Amortisation would push us pretty close to the limit, wouldn't it?

 

[warmleyseagull]

How does the new PSR rules affect us?

I think Revenue last season was around £200m which under the new rules, would have given us £170m to spend on wages/fees/amortisation.
Last season we spent £128m on wages and £32m on amortisation.

On the face of things an extra £32m on Amortisation would push us pretty close to the limit, wouldn't it?

No, for 2 reasons: 1) clubs can make losses of up to £105m over a 3 year period; 2) we sold Caicedo and Sanchez for £135m in August 2023 so were not included in the £120m profit for last year ending 30 June 2023. The profit on them is virtually the same amount as there would be little unamortised cost from Caicedo (cost little and 2/3 through his contract) and nothing for Sanchez.

The £145m quoted by OP would therefore be almost covered by these two transactions even if the costs of the incoming players were immediate written off.

One factor that receives less attention in these discussions is cost of agents. The club pays players agents’ fees, typically I believe 10-20%. I guess that these are also amortised over the contract period as a cost of acquisition. Interested whether EP or anyone can confirm

 

[Gabbiano]

Purchases this summer £145m
Average contract length 4.5 years
Annual amortisation expense £32m

Player sale profits
Undav £22m (25-3 book value)
Gross £7.5m (8-0.5 book value)
Leonard £0.5m
Total £30m

Net transfer cost this season £2m

#TrustInTony

What's the amortisation cost this year from previous seasons' signings? Surely that needs to be considered for the PSR numbers?

 

[Uh_huh_him]

No, for 2 reasons: 1) clubs can make losses of up to £105m over a 3 year period; 2) we sold Caicedo and Sanchez for £135m in August 2023 so were not included in the £120m profit for last year ending 30 June 2023. The profit on them is virtually the same amount as there would be little unamortised cost from Caicedo (cost little and 2/3 through his contract) and nothing for Sanchez.

The £145m quoted by OP would therefore be almost covered by these two transactions even if the costs of the incoming players were immediate written off.

One factor that receives less attention in these discussions is cost of agents. The club pays players agents’ fees, typically I believe 10-20%. I guess that these are also amortised over the contract period as a cost of acquisition. Interested whether EP or anyone can confirm

Not next season they don't.

My question is about what this season's increase in amortisation will have against next season's rules (85% of annual revenue).

 

[El Presidente]

The chances are that we

How does the new PSR rules affect us?

I think Revenue last season was around £200m which under the new rules, would have given us £170m to spend on wages/fees/amortisation.
Last season we spent £128m on wages and £32m on amortisation.

On the face of things an extra £32m on Amortisation would push us pretty close to the limit, wouldn't it?

Not quite, as player sale profits are subtracted from amortisation and wages are those of players and coaches only.

For reasons best known to itself, the assessment is on a calendar year basis too.

 

[redoubtable seagull]

We’ll sell Mitoma and one other exciting top talent next season. That will bring in £100m and help with balancing the books.
It’s all part of the plan.

 

[Uh_huh_him]

The chances are that we

Not quite, as player sale profits are subtracted from amortisation and wages are those of players and coaches only.

For reasons best known to itself, the assessment is on a calendar year basis too.

Weird.

How will that work?
Will the first review be on the period Jan-Dec 2024? or 2025?

 

[Uh_huh_him]

The chances are that we

Not quite, as player sale profits are subtracted from amortisation and wages are those of players and coaches only.

For reasons best known to itself, the assessment is on a calendar year basis too.

So in effect our spending allowance os 85% of Revenue + Player profit in the past 12 months.
But you have to use that profit in the next window.