Not completely true. A club isn't going to increase their salary just because a rule allows them to. This rules prevents a Man city or Chelsea jumping from relegation fodder or outside chancers to title challengers in one summer. It means that clubs have to build their way up. If a club is already at the title challenging level (or even top four) then they are unlikely to increase their salary level that much anyway.
Fair point but my point is that it simply maintains the gap between the smaller clubs and the bigger clubs. I understand that it's to stop teams spending massively in one go, but I felt that the FFP rules would help bring the richer clubs back down to a more reasonable level.
I'm sure someone will point this out BUT..... hang on.. anti competitive???? this is anything but. Simply put does Apple give a toss what some small little company tries to build or just cos apple has huge cash reserves its not allowed use them cos nokia hasn't got it? nope. If utd can AFFORD to spend 100mil on a player or 50, or 30 and west ham cannot there is a reason. Why should west ham spend 50mil of banks money to "compete" this is just a simple fact of life so lets not confuse what we all know Real MAdrid and Man city get up to with the real reason these rules are created. Companies (and all football clubs are companies) must live within their means and at least break even if not show a profit. The thing is... despite all this nobody complains about well run clubs in germany having massive amounts of cash. they are called successful. and nobody is complaining when city or chelsea descend on them to pay stupid moeny for players, nor should they. Lescott, milner, young, downing, torres, sinclair, the lsit of what can only be called lottery wins for clubs goes on and on. the fact is 100k is now average wage for these silly clubs, its not a star its donkeys and the "stars" are on 250k per week. The issue at hand is the sustainability of football itself, look across at us sports like baseball and basketball where wages and fees spiralled and similar actions had to be taken. If we want a healthy sport then we must accept that some clubs are top clubs but that should not prevent a wigan getting to a cup final or even an everton challenging for top 4. IF the situation continues as it is and europe is effectively full of middle east and russian oil monied play things like PSG, City, chelsea, Anzi and others then the sport suffers. If we've 6 billionaires competing for 4 cl slots then he rest suffer too. I'd much rather we see the club with the biggest support be the biggest side not some nothing club like city or CHESLEA boosted to the top and artificially held there while a few of their fans are in heaven but surrounded by plastics who are just there for the glory ithe stadium. 30k go to cheslea week on week, half are plastics in from all over. in any other world when utd have 76k and arsenal 60k then cheslea would be midtable at best... PERIOD.
Putting rules in place that stop clubs making huge consistent operating losses, is nothing more than common sense. Football needs to self regulate & it's long overdue. The current cycle had to end, or football in this country would eventually implode. The only people moaning about it are those who dream of the billionaire benefactor doing 'a City' at their club. Sorry but the door needed to be closed at some point & on the eve of a massive new TV deal, the timing had to be now. You chose to use United as your yard stick, United spend money they have generated by growing their business. Incidentally, you do know that they've spent less on players (both net & gross) than Liverpool, in both the last decade & during the entire time the PL has been in existence, don't you?
I can see the point in FFP, but its really a strange way of doing things. Firstly, what is its purpose? Is it to level the playing field? Entrench the already wealthy at the top? Prevent reckless gambling with a club's future? As far as I can see it, it is simply about entrenching the elite at the top. The rest is window dressing. Will it level the playing field and prevent gambling? Only to a limited extent. It will make mid-table teams competitive with each other, and prevent another sugar-daddy coming in and supercharging one midtable team. Gambling with a future? I can't imagine any other industry that tells a company's CEO that they can't speculate with their own money - be honest here - if a bank has agreed to bankroll a team, it isn't the team squandering the money, its the bank taking a punt having given the money to the club to use. As for making consistent operating losses, it used to be that a wealthy man would buy a club and bankroll it, the Moores family for instance with Liverpool and Everton. Making a profit was secondary (as it should be with sport). Its only with the intervention of banks into what was previously a rich man's province that profit and loss became critical. And its the money men ensuring that they keep the gravy train running. **** knows just how much the banks have made out of the Glazers' leveraged purchase of United, or from Real Madrid's repeated bailouts by the Spanish Government. Cynical? Moi?
True but Fergie spent a lot as he was developing and shaping up the squad - he broke transfer records consistently. He then got his squad to a place where he only needed to add 1 or 2 signings each season - big signings. I would like to see the average price per player though. In addition, we have spent a lot - but we should bear in mind the natural inflation of our prices as well as the inflation caused by Chelsea and Man City which makes the comparison with Utd's spending somewhat skewed.
lets leave the hatred of utd aside. let be frank here. while david moores was pissing about moaning about the cost of 12mil for the centenary stand utd built their stadium up to 76k, they spent THEIR money, made by their own revenue. there was no sugar daddy, no quick jump to the top. They built through their own endeavour. That's not to say "success" this their right but you cannot EVER deny they didn't do everything right, everythi the earned they did so by their own endeavor and fan base etc etc. Compare to chavski... the club that ken bates decided to run into the absolute ground by spending recklessly and then who got handed to a russian oligarch who set about spending billions to baost to his "friends" about his european cup to go with his biggest yacht. they have a pittance of a ground and spend shed laods, grossly wasting most. Now we see the city come after getting a stadium handed to them by the government of the back of the commonwealth games and not one but two extremely wasteful sugar daddies can count a couple of fa cups and one league bought so far. Fair... hardly. now look at arsenal mortgaged to the hilt to built thier ground but making money yet not willing to spend to ruin themselves... until some of their billionaire suitors take over and spend the legacy..... now look at west ham as two right corrupt spivs are rubbing thier hands with glee as another public project get awarded to a club and they fully expect to cash in hugely in selling up. 15mil and 2mil per year is the fee for the means to sell a london club who've done nothing ever to the highest bidder and again jump the queue now finally look at the disastrous state of blackburn, qpr et al. You do not even need look at LFC's near disappearance to see that some sense and regulation MUST come into this industry or see it ruined
With Arsenal supposedly making money and having X amount sat in a bank account, will they be able to spend this without incurring problems with FFP? I know clubs can make a loss (of about £13m?) over three years but if they have made large sums and they can legitimately afford to spend within their means do these rules allow it?
I'm not sure actually. It would be interesting to know the rules in regards to retained profits from either years. There maybe some calculation where these are taken into account but I'm not sure.
When I first read about these rules, my initial thought on the three year period was to cover this but in Arsenal's case, it is a much longer period than that. Same goes with Man Utd if you believe their 'money in the bank' claims.
Arsenal's cash reserves being spent won't create a loss in their P&L, so therefore won't infringe the FFP rules.
Why won't spending cash create a loss in the current year ? They may not have a deficit in retained profits but if they spend cash it will still be included in the relevant years profit and loss.
No, as there'd be no operating loss if they used cash reserves for player purchases, the cash released would offset the spending in the amortisation calculation.
Whether the money is reserves or not, the overall operating costs are a profit or loss including the use or build up of reserves when looking at company acocunts. I'm assuming you mean that the FFP rules encompass the possibility of reserves?
Yeah but you're assuming it's for player purchases in which case your right but losses can be created by wages, bonuses and other expenditure. I think the calcualation must have some way of ring fencing current reserves or some weird and wonderful calculation to take into account for current cash in hand / retained profit.
Yeah I'm sure it's an area that they've covered off, as you could just bolster the balance sheet with £400m of shareholders cash tomorrow & then release it over the next 'X' years. & yes I'd assumed purchases, as covering off losses with it, would of course mean you had a loss producing P&L. I'm sure cash reserves will have to be proven to have been previously generated by the business (not that there's many out there with any cash reserves anyway like)
At first yes, but once the system has been fully operating for a year or more, clubs shouldn't need to prove where reserves have come from because it would all be part and parcel of company accounts with each years report linking to the previous.
