Football 2010-2011

[eFestivals]

Their form near the end of the season was actually not that great, Everton and West Brom's was as good.

Much of last year's revival seemed to be down to the likes of Mereilles and Rodriguez playing much better, sounds like they're going to be binned though. That's what I dont get, binning them for Adam and Henderson? Weird, replacing like with like, not bettering the team.

Perhaps they wont sell them though, which will improve the squad, if not the team

With Maxi - if he is going - I don't think it's particularly the club binning him. He came to Liverpool as a mate for Mascho who wasn't happy (not that it ended up making a difference), so after Mascho went I always thought he wouldn't stay around for too long.

[Benj]

isn't it the case tho that an owner can pump as much money into a club as he likes, as long as it doesn't go on the books as a debt?

If that's correct then ultimately, for the likes of Chelski and Shitty, the FFP rules come to mean very little.

[ralph250]

isn't it the case tho that an owner can pump as much money into a club as he likes, as long as it doesn't go on the books as a debt?

If that's correct then ultimately, for the likes of Chelski and Shitty, the FFP rules come to mean very little.

[TheGayTent]

Neil,

Got your WHU v Aldershots tickets yet? Adults £10, kids £5.

[ralph250]

The break-even result for a reporting period is calculated as relevant income

less relevant expenses (see Article 58).

2. Relevant income is equivalent to the sum of the following elements (detailed in

part :

a) Revenue – Gate receipts

Revenue – Sponsorship and advertising

c) Revenue – Broadcasting rights

d) Revenue – Commercial activities

e) Revenue – Other operating income

f) Profit on disposal of player registrations (or income from disposal of player

registrations)

g) Excess proceeds on disposal of tangible fixed assets

h) Finance income

Relevant income is decreased if the elements a) to h) in paragraph 2 include any

items below (detailed in part :

i) Non-monetary credits

j) Income transaction(s) with related party(ies) above fair value

k) Income from non-football operations not related to the club

3. Relevant expenses are equivalent to the sum of the following elements (detailed

in part C):

a) Expenses – Cost of sales/materials

Expenses – Employee benefits expenses

c) Expenses – Other operating expenses

d) Amortisation/impairment of player registrations and loss on disposal of player

registrations (or costs of acquiring player registrations)

e) Finance costs and dividends

Relevant expenses are increased if the elements a) to e) in paragraph 3 include

the item below (detailed in part C):

f) Expense transaction(s) with related party(ies) below fair value.

Relevant expenses are decreased if the elements a) to e) in paragraph 3 include

any items below (detailed in part C):

g) Expenditure on youth development activities

h) Expenditure on community development activities

i) Non-monetary debits/charges

j) Finance costs directly attributable to the construction of tangible fixed assets

k) Expenses of non-football operations not related to the club

http://www.uefa.com/MultimediaFiles/Download/Tech/uefaorg/General/01/50/09/12/1500912_DOWNLOAD.pdf (page 70)

[strummer77]

With Maxi - if he is going - I don't think it's particularly the club binning him. He came to Liverpool as a mate for Mascho who wasn't happy (not that it ended up making a difference), so after Mascho went I always thought he wouldn't stay around for too long.

[eFestivals]

Neil,

Got your WHU v Aldershots tickets yet? Adults £10, kids £5.

nah, I won't be there - it's too far to travel in midweek at a busy time of year. I'd lose a big chunk at the end of a working day, plus I'm likely to lose a chunk out of my normally earlier starts the next morning.

[eFestivals]

Haven't really read up on it completely, but isn't the general gist of FFP that it's revenue minus the relevant expenses.

Pumping capital as such, into the club wouldn't be classified as revenue and so would be excluded would it not?

I'm not entirely sure - every time I've read something about what the rules are they've differed from what I've read at a point before that.

But I've defo read at one point that pumping capital in is allowed, because the main purpose of the rules is to stop clubs being loaded with a dangerously high level of debt rather than making clubs strictly self-financing.

As far as it goes, pumping capital into a club isn't (from an accounting point of view) classed as normal 'income' - it's a gift, a donation, a 'loan' without re-payment terms because it doesn't get paid back. When people gift efests some money as some kindly do now and then, it's not in my accounts as normal 'income' (which would be liable for VAT), but is dealt with as money from a loan would be (tho of course without the need for it to be paid back) - this is how my accountant has said it should be done.

It doesn't seem to be the case that these rules coming up has changed how the money clubs (Chelski & Shitty) are doing things, aside from Roman having written off some loans in one part of the various Chelsea companies books, but (according to Private Eye, I think it was) the loans remain as a liability in one part of the companies that's outside of the reach of the fair play rules.

So I'm guessing that those two clubs (if not others) believe they've got a work-around to those rules. Accountants using loopholes? Who'd have thought it, eh?

[pink_triangle]

Am I the only one who thinks sunderland got the best of the deal. O shea, Brown, Gibson and Wickham for Henderson seems decent business. Although Im not sure I trust Bruce to get the best out of them.

[ralph250]

I'm not entirely sure - every time I've read something about what the rules are they've differed from what I've read at a point before that.

But I've defo read at one point that pumping capital in is allowed, because the main purpose of the rules is to stop clubs being loaded with a dangerously high level of debt rather than making clubs strictly self-financing.

As far as it goes, pumping capital into a club isn't (from an accounting point of view) classed as normal 'income' - it's a gift, a donation, a 'loan' without re-payment terms because it doesn't get paid back. When people gift efests some money as some kindly do now and then, it's not in my accounts as normal 'income' (which would be liable for VAT), but is dealt with as money from a loan would be (tho of course without the need for it to be paid back) - this is how my accountant has said it should be done.

It doesn't seem to be the case that these rules coming up has changed how the money clubs (Chelski & Shitty) are doing things, aside from Roman having written off some loans in one part of the various Chelsea companies books, but (according to Private Eye, I think it was) the loans remain as a liability in one part of the companies that's outside of the reach of the fair play rules.

So I'm guessing that those two clubs (if not others) believe they've got a work-around to those rules. Accountants using loopholes? Who'd have thought it, eh?

Edited July 7, 2011 by ralph250

[ralph250]

Am I the only one who thinks sunderland got the best of the deal. O shea, Brown, Gibson and Wickham for Henderson seems decent business. Although Im not sure I trust Bruce to get the best out of them.

Edited July 7, 2011 by ralph250

[ralph250]

Don't see a hope in hell of him going there but rumours that Malaga have bid 35m euros for Sneijder.

Sheikh your body down to the ground!

[eFestivals]

edit: don't know how much has changed regards Chelsea and writing off loans, but unless major changes do know they're not "debt free" as such. May 2010, the holding company (Fordstam) had a liability of £726m to Abramovich recallable with 18 months notice.

http://www.guardian.co.uk/football/2010/may/19/roman-abramovich-chelsea-loan-debt

As I said, what I'd read said that the debt (it was in the £700M area) was written off in the company or companies that are subject to the FFP rules, but left (or transferred, or something) as a debt in another part of the business - I can't remember the specific company names involved tho.

And I have a feeling that what I read was referring to something that's happened since the date you give (May 2010), tho I'm not entirely sure how the writer might have got access to that info if it's not in published accounts (could it be that the different Chelsea companies have different accounting dates?). Off the top of my head, it was around 5 or 6 months ago that I read what I did; unfortunately I don't keep copies of Private Eye, so I can't reference back to it (if it was even from Private Eye - it might not have been [i forget], but I think it was).

[lost]

city lease the city of Manchester stadium from the council don't they? I'm surprised the council has allowed them to sell the naming rights.. especially with all the cuts.

[TheGayTent]

city lease the city of Manchester stadium from the council don't they? I'm surprised the council has allowed them to sell the naming rights.. especially with all the cuts.

[eFestivals]

city lease the city of Manchester stadium from the council don't they? I'm surprised the council has allowed them to sell the naming rights.. especially with all the cuts.

it'll come down to what the terms of the lease agreement is. There's no particular reason I can think of why the council would want to absolutely stop the stadium being named in exchange for money paid to city, as long as the council felt that they were getting fair value out of their deal with city.

[ralph250]

Just signed new 5 yr contract with Smalling on presumably increased terms. Would expect similar with Hernandez this summer.

http://www.manutd.com/en/News-And-Features/Football-News/2011/Jul/smalling-signs-new-contract.aspx

[eFestivals]

good to see Aldershit in the promotion places.

http://news.bbc.co.uk/sport1/hi/football/eng_div_3/default.stm

The only way is down.

[ralph250]

Tariqpanja of bloomberg

EXCLUSIVE: Manchester City's 10-year agreement with Etihad Airways worth more than £300 million, according to person with knowledge of deal

http://twitter.com/#!/tariqpanja

[ralph250]

Bayern (who have the highest commercial income worldwide) receive £4m p/a for the Allianz stadium rights. (30 year deal)

Arsenal's Emirates deal was £100m for 15 year contract, though that includes 8 year shirt deal, which was £5.5m last year. Might have contractually gone up per year so might not have always been £5.5m but taking that figure, would mean around £3.7m p/a.

http://www.ukmediacentre.pwc.com/content/detail.aspx?releaseid=2227&newsareaid=2

Etihad stadium £30m p/a?

edit:

Man City values sponsorship at not only stadium/shirt contract but also ability for Etihad to sponsor several projects across 80 acre site

http://twitter.com/#!/tariqpanja

Edited July 8, 2011 by ralph250

[eFestivals]

Bayern (who have the highest commercial income worldwide) receive £4m p/a for the Allianz stadium rights. (30 year deal)

Arsenal's Emirates deal was £100m for 15 year contract, though that includes 8 year shirt deal, which was £5.5m last year. Might have contractually gone up per year so might not have always been £5.5m but taking that figure, would mean around £3.7m p/a.

http://www.ukmediacentre.pwc.com/content/detail.aspx?releaseid=2227&newsareaid=2

Etihad stadium £30m p/a?

I don't see how anyone can question it's value.

But in all seriousness, I don't. If you're a business - MCFC - and another business wants to pay you what you consider to be way over the odds for something, are you really going to stop them? (It might be said that Fergie does just that with every player sale to another mug punter, the latest being Steve Bruce ).

For UEFA to take action, they'd surely have to prove something corrupt about the deal, which is probably unlikely because if it is corrupt they've surely covered their tracks. And City could argue that the value includes their potential as the next 'best club in the world', and the value of that at the point the contract finishes (and, they could argue, including a long time beyond) could be astronomical - but certainly impossible to value right now.

As I said above, I'm sure the clubs will find ways around the FFP rules, and this looks like one of them. I'm sure your own club (and others) will have its own highly questionable deals or transactions of one sort or another.

Edited July 8, 2011 by eFestivals

[eFestivals]

having edited the post above to say "I'm sure your own club (and others) will have its own highly questionable deals or transactions of one sort or another", I've just realised its already there.....

The move of the Glazers' accounts to Delaware, where they're able to legally hide all sorts of details from UEFA. That surely gets to mean that UEFA have to take anything Utd say about their finances on trust, without being able to verify if that's really the case thru published accounts (which they'll be able to do for most, if not all, other clubs).

We had a brief discussion at the time of the move wondering what exactly was behind it. I don't think we ever considered that it might be the FFP rules.

[ralph250]

I don't see how anyone can question it's value.

But in all seriousness, I don't. If you're a business - MCFC - and another business wants to pay you what you consider to be way over the odds for something, are you really going to stop them? (It might be said that Fergie does just that with every player sale to another mug punter, the latest being Steve Bruce ).

For UEFA to take action, they'd surely have to prove something corrupt about the deal, which is probably unlikely because if it is corrupt they've surely covered their tracks. And City could argue that the value includes their potential as the next 'best club in the world', and the value of that at the point the contract finishes (and, they could argue, including a long time beyond) could be astronomical - but certainly impossible to value right now.

As I said above, I'm sure the clubs will find ways around the FFP rules, and this looks like one of them. I'm sure your own club (and others) will have its own highly questionable deals or transactions of one sort or another.

[ralph250]

having edited the post above to say "I'm sure your own club (and others) will have its own highly questionable deals or transactions of one sort or another", I've just realised its already there.....

The move of the Glazers' accounts to Delaware, where they're able to legally hide all sorts of details from UEFA. That surely gets to mean that UEFA have to take anything Utd say about their finances on trust, without being able to verify if that's really the case thru published accounts (which they'll be able to do for most, if not all, other clubs).

We had a brief discussion at the time of the move wondering what exactly was behind it. I don't think we ever considered that it might be the FFP rules.

[eFestivals]

The clubs accounts aren't in Delaware though, just one of the ultimate holding companies. Wages/Amortisation/general running expenses can't be outside of those club accounts.

Of relevant expenses outlined on the previous page, only "finance costs" (so debt), would be in that holding company. We're back to the PIKS (or refinanced amount) being personal debt argument though.

as before, if PIKS have been refinanced, presume Glazers will eventually take dividends in the future to reduce that liability or wait until they sell up and clear that debt with the proceeds.

Outside of FFP I think, how far up the chain (or holding companies) do you go? otherwise might as well start including the mall's mortgages etc or other debts in the Glazer portfolio (and additionally to every other club's owners).

While Delaware companies might not be in the relevant financial loop currently, I'm sure there's plenty of ways they could be used to FFP rule advantage if Utd was so inclined.

Off the top of my head, a less transparent thing might be to grant those companies certain licencing rights, which can then be exploited outside of UEFA's sight. Or completely hidden for the details, the payments that Utd make up the chain that are ultimately used to service the debt could be increased so that some of the money was being used to pay players (and so showing lower wage costs in the visible UK companies). While some of the details might be a bit fiddly to achieve in an accounting sense, it only takes a glance at the more normal multi-national companies to see that (say) a million quid's worth of costs in doing something like these pays back big time.

These are the sorts of things that dodgy accountants live for.