5waller5 Posted 27 February 2014 Posted 27 February 2014 This is presumably why they are joining in the campaign against it then? My questions were genuine questions by the way ... not a point of view, just what i understood and seeking clarification on!!
Strokes Posted 27 February 2014 Posted 27 February 2014 If that's the case I fail to see how we can reach FFP this year... Would take a £12m drop from that kind of figure.Maybe a bit of creative accounting, dumping as much expenditure into last year as possible?
Ric Flair Posted 27 February 2014 Posted 27 February 2014 Who have we got rid of that would save us £12m? Beckford and Marshall transfer fees received (£2 million) disposing of Wellens, Danns, Gallagher on loan/termination, Waghorn wages saved for at least 6 months. Hmmmm doesn't equate to £12 million not when you add in Wasilewski, Hammond, GTF, Mahrez and Phillips.
Bert Posted 27 February 2014 Posted 27 February 2014 Beckford and Marshall transfer fees received (£2 million) disposing of Wellens, Danns, Gallagher on loan/termination, Waghorn wages saved for at least 6 months. Hmmmm doesn't equate to £12 million not when you add in Wasilewski, Hammond, GTF, Mahrez and Phillips.Consider the fact that 4/5 players that left we're earning £1m+ a year with us as well. The players brought in won't be earning that much each a year.
Ric Flair Posted 27 February 2014 Posted 27 February 2014 Consider the fact that 4/5 players that left we're earning £1m+ a year with us as well. The players brought in won't be earning that much each a year. Yes i'm sure that must make up a large part of it, but it would take a £12 million drop minimum to make FFP if we dropped from £30 mill loss to £20 mill last season (subject to confirmation) which is a massive cost cut and I can't see where all the obvious cuts have come from, perhaps there's some behind the scenes that we aren't aware of.
Bert Posted 27 February 2014 Posted 27 February 2014 Yes i'm sure that must make up a large part of it, but it would take a £12 million drop minimum to make FFP if we dropped from £30 mill loss to £20 mill last season (subject to confirmation) which is a massive cost cut and I can't see where all the obvious cuts have come from, perhaps there's some behind the scenes that we aren't aware of.As someone else has mentioned (I have no idea on this) interest will have a big part to play in it all as well.
Tommy G Posted 27 February 2014 Posted 27 February 2014 The interest would be in the P&L regardless if it was paid, it would be on an accruals basis. Some people here getting mixed up with what hits the balance sheet and what hits the P&L
MooseBreath Posted 27 February 2014 Posted 27 February 2014 Of course the interest was relevant, it was hitting our P&L every year, regardless of whether it was paid. Fair enough then. Do ffp look at P&L or the actual expenditure? If we've accrued that interest but not paid it in previous years can we reverse the accrual this year to give us a profit?
Guest ttfn Posted 27 February 2014 Posted 27 February 2014 Fair enough then. Do ffp look at P&L or the actual expenditure? If we've accrued that interest but not paid it in previous years can we reverse the accrual this year to give us a profit? Good question and I wonder if that was done before the loan was converted to equity. It seems like a no-brainer that should have happened to me.
Ric Flair Posted 27 February 2014 Posted 27 February 2014 The interest would be in the P&L regardless if it was paid, it would be on an accruals basis. Some people here getting mixed up with what hits the balance sheet and what hits the P&L I watched some programme a while ago about how players aren't classed as assets if they are purchased, only if they come through the academy. Very unusual given many bought in players have a re-sale value of more than they paid for them, not sure if it's actually true or if the programme was off the mark. It might explain why football clubs are an absolute mess.
Manwell Pablo Posted 27 February 2014 Posted 27 February 2014 We could spend what we want next year, the point I was trying to make was that should you them come down you would get hammered by FFP. I thought you get a year exempt from it on relegation to try and sort yourself out (terrible rule)
Foxes Blue Blood Posted 27 February 2014 Posted 27 February 2014 This is where my understanding of FFP fizzles out ..... Are Premier league clubs bound by the same rules??? I thought not? If they are then £120m is the often touted prize of promotion so surely we could spend £120m and without bumping into any FFP problems ..... also isn't there a percentage loss that you're allowed??? If so the percentage loss of an additional £120m would make that figure £130m? £140m?? Do you, or anyone know for sure how this works and can answer those question Premier League clubs come under it in December 2014 for wages/equity breaches & December 2016 for exceeding loss limits, the maximum loss for a Premier club is £15m over 3 seasons or if an owner is prepared to inject equity the it rises to £105m over 3 seasons, exceed this and it's points deduction. I believe the £120m quoted is made up of TV money final position payment and 3 years payment for dropping into Championship. the last figures I saw was :- £40 m TV £40 m Bottom Place £45m (3x£15m) for dropping into the Championship. An interesting point for us is any Promotion related bonus payments do not count for FFP. I think Pearson is on £1m Bonus if we get promoted.
hackneyfox Posted 27 February 2014 Posted 27 February 2014 I believe the £120m quoted is made up of TV money final position payment and 3 years payment for dropping into Championship. the last figures I saw was :- £40 m TV £40 m Bottom Place £45m (3x£15m) for dropping into the Championship. An interesting point for us is any Promotion related bonus payments do not count for FFP. I think Pearson is on £1m Bonus if we get promoted. It's a combined total of 60m for the first season (position & tv) The other 60m is spread over 4 years with the first payemnt being 23m.
5waller5 Posted 27 February 2014 Posted 27 February 2014 Premier League clubs come under it in December 2014 for wages/equity breaches & December 2016 for exceeding loss limits, the maximum loss for a Premier club is £15m over 3 seasons or if an owner is prepared to inject equity the it rises to £105m over 3 seasons, exceed this and it's points deduction. I believe the £120m quoted is made up of TV money final position payment and 3 years payment for dropping into Championship. the last figures I saw was :- £40 m TV £40 m Bottom Place £45m (3x£15m) for dropping into the Championship. An interesting point for us is any Promotion related bonus payments do not count for FFP. I think Pearson is on £1m Bonus if we get promoted. Good response - Thanks for the info!!
bluesbrothers Posted 27 February 2014 Posted 27 February 2014 Frankly, I'd be fvcking embarrrased if our club was one of those objecting, given the state we were in before the belt tightening here began.
hackneyfox Posted 27 February 2014 Posted 27 February 2014 Good response - Thanks for the info!! Unfortunately it's wrong about parachute payments.
lancyclaret Posted 27 February 2014 Posted 27 February 2014 FFP may have too many loopholes to stop the "big" clubs spending what they want, but sooner or later I think English football will go down the same route as American football, US basketball and baseball - not to mention English cricket - and introduce a salary cap which is the same for every club/franchise. There are 30-odd teams in grid-iron - some with extremely wealthy owners but the richest clubs cannot spend any more than the poorest club if that poorest club reaches the salary cap's maximum. I follow Washington Redskins, who have one of the richest owners, but if he wants to sign the superstar players, it leaves him with a problem. If 3 superstars use up 30% of the salary cap, there will only be 70% left to sign the 40-odd other players needed for the squad. This salary caps works as an unglamorous team like Seattle (without many household names) thrashed a star-studded Denver in this year's Super Bowl. Denver's star player earns a ridiculous amount of money but that means there is less in the pot for the other Denver squad players. It's starting to work in English cricket as the "richest" club Surrey got relegated last year while Northamptonshire, one of the poorest, got promoted in their place.
shade Posted 27 February 2014 Posted 27 February 2014 FFP may have too many loopholes to stop the "big" clubs spending what they want, but sooner or later I think English football will go down the same route as American football, US basketball and baseball - not to mention English cricket - and introduce a salary cap which is the same for every club/franchise. There are 30-odd teams in grid-iron - some with extremely wealthy owners but the richest clubs cannot spend any more than the poorest club if that poorest club reaches the salary cap's maximum. I follow Washington Redskins, who have one of the richest owners, but if he wants to sign the superstar players, it leaves him with a problem. If 3 superstars use up 30% of the salary cap, there will only be 70% left to sign the 40-odd other players needed for the squad. This salary caps works as an unglamorous team like Seattle (without many household names) thrashed a star-studded Denver in this year's Super Bowl. Denver's star player earns a ridiculous amount of money but that means there is less in the pot for the other Denver squad players. It's starting to work in English cricket as the "richest" club Surrey got relegated last year while Northamptonshire, one of the poorest, got promoted in their place. nice to see the US of A getting something right!
LCCFox96 Posted 27 February 2014 Posted 27 February 2014 This just makes promotion this year even more important.
49er Posted 27 February 2014 Posted 27 February 2014 This must be an early April fool - the article is written by Mr Conn!
Guest ttfn Posted 27 February 2014 Posted 27 February 2014 I watched some programme a while ago about how players aren't classed as assets if they are purchased, only if they come through the academy. Very unusual given many bought in players have a re-sale value of more than they paid for them, not sure if it's actually true or if the programme was off the mark. It might explain why football clubs are an absolute mess. As far as I understand it, the players themselves aren't assets but their registrations are. The accounting for it is as follows: Let's say we signed Andy Reid from Forest on 31 May 2014 (the final day of our accounting year) for £4 million on a four-year deal. At 31 May 2014, his registration would be worth £4 million - this is the amount we paid in an arm's length transaction with another club. The "cost" is not recognised in profit or loss for the year. The only other impact on the accounts is that we have £4 million less. The next year (ended 31 May 2015), £1 million of his contract is recognised as a loss in the accounts, as it is 1/4 of the way through its duration, and the value of his registration would be reduced to £3 million. This happens every year until the contract expires, when it is worth nothing (obviously). Where it gets a bit more "interesting" is if, for example, Manchester United come in on 31 May 2016 (i.e. 2 years into his contract) and offer us £5 million for him. Rather than make a profit on the transfer of £1 million in the accounts, in that year (2016 accounts) we'd actually make a profit of £3 million, being the £5 million cash received less the £2 million remaining value of his contract. This is why, for FFP and accounting reasons, the fact that we spent £2.5 million on Beckford and only received £1 million back when we sold him at the start of 2013-14 won't give us a £1.5 million loss in this year's accounts, nor will it give us a £2.5 million loss in the year in which he was bought and a £1 million profit this year. Instead it will give us about a £500k loss in each of the three accounting seasons he was with the club. As such, any analysis of our FFP position which discusses transfer fees in any particular season sort of misses the point, because a £1 million signing on a 3 year deal costs you less in "accounting" transfer fees than a £500k signing on a 1 year deal.
5waller5 Posted 28 February 2014 Posted 28 February 2014 As far as I understand it, the players themselves aren't assets but their registrations are. The accounting for it is as follows: Let's say we signed Andy Reid from Forest on 31 May 2014 (the final day of our accounting year) for £4 million on a four-year deal. At 31 May 2014, his registration would be worth £4 million - this is the amount we paid in an arm's length transaction with another club. The "cost" is not recognised in profit or loss for the year. The only other impact on the accounts is that we have £4 million less. The next year (ended 31 May 2015), £1 million of his contract is recognised as a loss in the accounts, as it is 1/4 of the way through its duration, and the value of his registration would be reduced to £3 million. This happens every year until the contract expires, when it is worth nothing (obviously). Where it gets a bit more "interesting" is if, for example, Manchester United come in on 31 May 2016 (i.e. 2 years into his contract) and offer us £5 million for him. Rather than make a profit on the transfer of £1 million in the accounts, in that year (2016 accounts) we'd actually make a profit of £3 million, being the £5 million cash received less the £2 million remaining value of his contract. This is why, for FFP and accounting reasons, the fact that we spent £2.5 million on Beckford and only received £1 million back when we sold him at the start of 2013-14 won't give us a £1.5 million loss in this year's accounts, nor will it give us a £2.5 million loss in the year in which he was bought and a £1 million profit this year. Instead it will give us about a £500k loss in each of the three accounting seasons he was with the club. As such, any analysis of our FFP position which discusses transfer fees in any particular season sort of misses the point, because a £1 million signing on a 3 year deal costs you less in "accounting" transfer fees than a £500k signing on a 1 year deal. That makes sense from an accounting perspective and is a logical way of writing down the asset which is the player's contract with the club. Good explanation.
ealingfox Posted 28 February 2014 Posted 28 February 2014 Twohundredpercentâ€@twoht Tee hee: David Conn accused of "lazy journalism" by some Leicester supporters - http://www.foxestalk.co.uk/forums/topic/93154-clubs-make-legal-threat-to-football-league-over-financial-fair-play/ … Reply Retweet Favorite More RETWEET1 6:34 PM - 27 Feb 2014 Twohundredpercent â€@twoht 14h New on 200%: On Financial Fair Play & Legal Threats - http://twohundredpercent.net/?p=25477
Iwan is a Welshman Posted 4 March 2014 Posted 4 March 2014 @StringerSport: #LCFC confirm losses of £34m for 2012-13. No Financial Fair Play penalty yet. Shows work needed for 2013-14. 104.9fm for more
Number 6 Posted 4 March 2014 Posted 4 March 2014 I actually think most football fans think the concept of FFP is a good one. Especially after we all saw what happened with Pompey. The problem is that the current set up is flawed. EPP will make it very difficult to get good value youngsters in and utilise the youth system. Clubs coming down from the Premier league will also have a HUGE advantage over those who have not been up for a while. It's a vital time to look for promotion as next season the teams coming down will have received £60m+ for their finishing position, as much as Manchester City got for winning the title. I imagine whoever comes down this year will comfortably challenge for promotion straight back. This will balance out after a few years to a group of teams who will yoyo. It'll become much harder for a team to break back into the top flight after a long absence. It will, of course, still be possible, but it might see owners disregarding FFP for a year to go for it and I'm not sure that'll leave clubs in a sounder financial position.
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