FFP benefits bigger clubs

Thanks Schad for taking the time to post that. This bit I've pulled out is probably the key bit then for non-accounting folk (like me) to get to grips with.... I'd like to know how Chelsea managed to do that and are we accounting differently and how?

The difference in the PL and the UEFA interpretations is classic football with the right hand and the left hand not delivering the same message!

I'd need to take some time to look at all out expenditure and how we account for it (Liebherr loans etc) to really take an educated view. After all, it can be just like having a mortgage, that to an individual person is a large number but still has manageable payments.

I will take a good look when Octobers figures are published and try and understand them better and in particular this area.

 

Best I'm aware, the accounting is standardized. It's just that the way that player sales is handled is a bit silly; the 'profit' is against their paper value, and their paper value is effectively what you paid for them, deducting whatever percentage of their contract has elapsed. So academy players, for whom no transfer fee has been paid, are considered worthless until they're sold, at which point it becomes pure profit. It's also why the club's profit really only matters for the UEFA calculations (or if you're the guy cutting the cheque to HMRC), because it's quite easy to feature paper profits or losses entirely divorced from actual movement of money; the most meaningful numbers are the ones pertaining to cashflow, namely the net debt and any major financial commitments (or incoming money owed) down the line.

I don't disagree with the belief that spending every cent is a bad idea; we shouldn't go nuts, though I'd argue that there's a middle ground between going nuts and our current approach that would be a better long term option. But that's a choice we're making, rather than a reality foisted upon us by the FA's regime.

 

The main issue I have with FPP is why are we supposedly struggling to comply when we regularly post profits in terms of transfers each season, not taking into account the TV money? Virtually every other team in the PL operates at a loss when it comes to net spend on transfers so why are we not hearing about them flapping about FPP? Is it that they just don't care about it? And if that is the case then why do we care? I have had the feeling for the past couple of seasons that whilst it is "admirable" or whatever you want to call it that we are trying to be self sufficient it just means that we are starting at a disadvantage to other teams who are willing to spend bigger.

I'm not talking about the traditional big clubs who obviously have far high turnover than we do, but the likes of Sunderland/Watford/Swansea

 

I can only point you in the direction of the man who makes the comments. What twist you put on it afterwards is entirely upto you. However, I tend to take it at face value until proven otherwise.

 

Yes Les Reed has a history of telling the truth and not just spouting a line the majority want to hear