Terraloon

Have to keep going back to the accounts because just when I start to get my head around matters then something else jumps out at me. For instance the debt under the stadium HP has increased. I am trying to get my head around how or indeed if the extra sum impacts PSR . Similarly debt interest on sums converted to equity have been waived. Nothing is wrong in terms of how the accounts are put together but following on from the Man City arbitration settlement with the PL there are now requirements around assorted and related parties when it comes to PSR calculations.

Initially there was a £90+ million loan drawn down from KPI to finance the build. But following conversation of debt to equity it become ever more difficult to work out what is owed and not subject to a formal fixed or floating charge or what exactly the position is when it comes to what would happen if any creditor had need to enforce non payment. Everything I see or shall I say read , suggests that LCFC Ltd is the owner of Seagrave. The problem is that LCFC is owned by Top and or KP. So to a degree it’s irrelevant.

Sorry but that’s not quite what the club states. It said “It anticipates compliance” Bear in mind that the accounts were signed off before the outcome of the 23/24 charges were known but also some of the rulings in there particular around the apportionment of the 13 month period. Like someone else posted until we see the outcome of the appeals it would be process to lodge , if applicable, any charges for 24/25. One little snippet in the accounts was something I didn’t know was that the EFL are running a shadow SCR model for 25/26

It would appear so , yes I use the word appear , that depreciation on the asset appears on the clubs balance sheet meaning it is a club asset but there is also mention that it is subject of an HP agreement with KP which has been extended for another 10 ? years.

The money bought in may be close to £50m but the profit will likely translate into circa £25m profit. Which as we know will equate to no more than £15m more than reflected in the 24/25 monies. I need to gather my thoughts fully and of course the wages being paid to what were bought in as PL players along with their amortisation will slowly but surely be no more. The problem is that without PL football or Parachute Payments the running costs of things such as Seagrave , and the Stadium will alone take care of a significant % of all the income streams if you ignore broadcasting ( Parachute Payments)

I must admit I haven’t fully read the accounts but do the club say that or do they something along the lines of we believe we are compliant?

I’ve actually just found my notes when I put together my PSR estimates. 22/23 loss £89m allowables £29m number for PSR £60m loss 23/24 loss £19m allowables £29 m number for PSR £10m profit 24/2* loss £71 m allowables £29 m number for PSR £42 m loss. In my initial calculations I believed it would be £30 m Three years £92m against allowable £83m I should add that some of the income numbers such as gate receipts were higher than I expected and I have used the same number for academy and woman’s football.

When I adopted a back of a fag packet calculation some months ago I suggested that anything over a £40 million loss would cause problems and at that time I thought the loss would be around that number but i genuinely thought both wages and amortisation would be lower. So on the face of it I fear an incoming charge. What concerns me even more is that using the chart the suggestion is that 25/26 has to deliver no more than a £11 million ish loss if yet another charge is to be avoided.

The 80% isn’t just wages . You also have to add on amortisation/ impairment and agent fees.

Odd isn’t it assumed that it was a 5 year deal but no you are right it was a 4 year one.

Not sure it will achieve its aims but in theory that’s the whole point of SCR. However the 85% allowable in the PL is too high and whilst wouldn’t want to applaud UEFA 70% seems far more realistic

The charges, they have aren’t just in respect of parachute payments , are numerous the club have jumped into bed with Macquaire in respect of sums still owed to LC in respect of historical transfers. In effect any of those clubs default that will lead to trouble. It appears that the parachute payments probably aren’t paid in one sum in June as the charge has been extended into 2027. If you look at the latest confirmation statement there has been quite an increase in equity , well there has been since we last saw the allocation of shares , Top himself seems now to have 30m £1 shares alongside increases in KP shares . That almost certainly is the announcement increase in equity where debt was converted to shares. I don’t want to defend Top/KPI but the fact that they have converted debt to equity does suggest that they have injected cash indeed Seagrave was built using their monies In reality cash is going to be the problem . Top may well have to put cash in but with those loans will now come an assumed charge to interest which will all add to the running costs.

Not the most accurate but I rely as much on Transfermarket as any other source. It’s stated that he signed in 24/25 for €22.5 m and that a loan fee of €3 m was received . At the end of 24/25 his remaining value would have been €18 m and although not at the end of 25/26 that value will be down to €13.5m however as the transaction happened, it seems in 25/26 the sum that needs to be used is €18 m i would imagine that around 50% of his initial fee is still owing along with circa 60% of his signing on fee that will become payable immediately. So what does all that mean? Well effectively the reported €15 million fee and €3 m fee spooky as it seems matches his book value. So accounting broadly neutral but it’s those pesky wages, likely agents fees etc which added up mean…. A disaster

Not wanting to defend anyone but trying to track filed documents on the Companies House website isn’t it seems the exact science it should be. I noticed significant delays not just in LCFC but numerous other entities that I have viewed what I noticed is that a significant number were said to be late in filing confirmation statements. In the case of LC the front screen on the record suggests that the confirmation statement was actually filed on 25/11/25

Liability is limited( hence why we have Ltd companies ) so I very much doubt that she personally would have any liability although their is something called negligent employee which would include directors and those that hold senior but have not been directors but that is usually only invoked when an employee doesn’t ensure that their tax/ Nic is deducted correctly or the deductions aren’t submitted to HMRC. I believe the legal responsibility rests with the directors when it comes to charges of trading whilst insolvent.

It’s the directors that are legally bound to steer clubs into administration. It’s one of a variety of actions that are deemed to be insolvency events and in the hands of the directors to invoke or potentially face charges for trading whilst insolvent. Banks lend , not always, but more often than not knowing if the sh1t hits the fan they are to a large degree protected having secured either a fixed and or floating charge over the entities assets. HMRC doesn’t force clubs into Administration what they do is issue WUO ( winding up orders) when clubs don’t pay the VAT, PAYE and Nic .They take such actions to “ Protect The Public Purse” and that doesn’t mean just dealing with debt already quantified but also to ensure that further debt doesn’t accrue. The Enterprise Act 2002 removed what was then The Inland Revenue and Customs and Excise from preferential creditor status and although that has to a degree returned the football creditor rule added a super creditor type which HMRC has challenged , unsuccessfully, but I wouldn’t rule out that the Labour Government and some point legislate to clarify. It’s worth noting that the number of WUOs issued by HMRC has decreased significantly. That to a large degree is because clubs are more up to date with tax payments if for no other reason than debt not under control ( paid or subject to a time to pay agreement) leads to a transfer embargo as a minimum. The EFL announced pre season that the Championship clubs were discussing the possibility of introducing SCR not a lot has been reported but I for one think it’s inevitable the only question will be what % of football revenue will be allowed to be spent on the squad. Some months ago I talked about how the likelihood was that spend limits over in % terms as opposed to a set sum £105 million) that is the mechanism that will in place in the PL post 25/26 . I can’t believe 14 clubs voted for SCR . I am not sure exactly how it will play out but I genuinely believe that it will massively benefit the big 6 and yes they will be constrained to UEFas 70% that will be measured against a significantly number than those PL clubs that don’t feature in UEFA football. On that I suspect some clubs will possibly reject the opportunity of playing in the EL or the Conference because the prize money isn’t big enough

It’s understandable to compare costs but the reality is that non league clubs main revenue stream, generating a huge % of their overall running costs, is match day whereas for LC and indeed most PL, EFL receive a significant % of their income from broadcasting and in the EFL monies filtering down from the PL deal. Yes NL clubs get a little from the PL but drop down the pyramid and little to nothing finds it way to non league.

I have just re read my posting and I must be thick! The last accounts we have seen were up to 30/6/24, not 30/6/25. So it’s possible indeed fa t that that debt to equity will reflect in the soon to be lodged accounts.

We need to wait a couple more weeks before we get sight of the ye 30/6/25 numbers but sorry unless the numbers have massively improved then debts are massive. From memory it’s circa £250 m which I believe, again from memory was after the equity swap which was said to have happened in Jan 25. We know not all the debt to KP has been wiped because for instance the stadium is subject to an HP agreement. The club own the stadium and indeed both training grounds but again without access to the accounts and or Land Registry records it’s difficult to get a handle on the here and now. Seagrave was financed with a close to £100m loan from KP. If and it’s an if, the cub goes into Administration and football creditors are owed then it will be interesting which takes precedence. Why I say that is because if Macquarie does then somehow all football creditors will have to be paid and if the club were to retain league status I think I am right in saying that all other creditors will have to be satisfied as well. There was a significant sum owing to the club but a fair chunk of that was, again as of some 9-10 months ago was sums still owed in respect of transfer sums still owed but as we know LC factored these out so the likelihood is that whist the debtors will still be shown the cash has already been spent. Finally I think you need to look at the Jan 26 charge registered by Macquarie because even when the 30/6/25 accounts come out I doubt the full impact and indeed current borrowing under that agreement will be clear.

So if the club let a player with sums still to be amortised go for free aren’t you reducing the book value ? You simply can’t under accounting process just write off the value of an asset without it impacting in the numbers and in every squad ratio calculation I have seen player trading and that includes both amortisation and impairment are factored into squad costs . Heres the explanation of the PLs rules Four primary expenditure types constitute the regulated squad costs. Wages and salaries: This encompasses the total gross compensation, including base salary, performance bonuses, and image rights payments, for all contracted first-team players and the head coach. Notably, the salaries of assistant coaches, medical staff, and administrative personnel are excluded. Amortisation of transfer fees: In line with standard football accounting, the cost of acquiring a player is not recognised as a lump sum in the year of purchase. Instead, the transfer fee is amortised, spread equally, over the length of the player’s contract, up to a maximum period of five years. Agent and intermediary fees: All commissions and fees paid to player representatives during contract negotiations or transfer transactions are included in the annual squad cost calculation. Impairment losses: If the book value of a player’s registration decreases significantly due to factors such as long-term injury, permanent performance decline, or the club’s relegation, the resulting impairment loss must be factored into the squad costs for that period. I admit I am not close to 100% of the EFL rules but unless impairment were factored into squad costs all clubs would do is write players values down to nil and they simply won’t do that Irrespective if transfer profit and loads is excluded in the 60% squad cap ( I think in year one for a relegated Championship Club it’s actually 75%) then no point selling anyone that’s any good.!

Morally, yes I know that’s a strange word to use when discussing football, there is absolutely no way that ST shouldn’t go down but, LC probably can’t afford to keep prices the same so will be increased. That is unless the club somehow cut costs by a vast %

A loss on player transfer value is factored into squad cost its called impairment which is treated in exactly the same way as amortisation.

There was no doubt that the points deduction on Luton was draconian but Luton’s issues at the time regarding entering administration on more than one occasion added to their seemingly lesser issues but the FA believed and so it turned out ,were able to be proven in front of an IC . That it is stated is where the PL believed their case against Chelsea differed. The second Chelsea fine came about not because of any complaint by anyone but it was the way in which a senior member of staff conducted themselves and it was their new owners that flagged up what had happened. I should add that there are still the 74 cases they have been charged by the FA and it was their new owners FA that deducted those points from Luton

Think you are wishing something that really isn’t going to happen.