Here's hoping we don't end back there with spending restrictions in place from next season... http://www.bbc.co.uk/sport/0/football/17841566 QPR celebrate Championship win Championship clubs making losses of more than £6m will be fined millions of pounds or put under a transfer embargo from the 2014-15 season. Three of the 24 clubs voted against new regulations to limit investment from owners and curb total spending. The changes will also prevent owners from funding their clubs through loans. Football League chairman Greg Clarke said: "They will begin to lay the foundations for a league of financially self-sustaining football clubs." Owners will be allowed to invest £6m next season, £5m the year after, then £3m in the 2014-15 season. From 2015-16, clubs will be allowed to make a £2m operating loss, as well accept a £3m investment from an owner - allowing for a £5m overall loss. Clubs promoted to the Premier League that fail to adhere to the amendments must pay a fair-play tax on their losses, ranging from one per cent on the first £100,000 to 100 per cent on anything over £10m. Non-promoted clubs will not be punished financially for failing to adhere to the new rules, but instead placed under a transfer embargo. QPR made a loss of £25.4m in their promotion season and would have been fined around £15m if the new regulations had been in place last year. Clubs relegated to the Championship will not be subject to sanctions in their first season as long as they have met their financial obligations under Premier League regulations. They would, however, have to pay the fair-play tax if they did not comply with the new regulations and got promoted. The new regulations are based on Uefa's break-even model of Financial Fair Play and come after the Football League's research revealed the 72 clubs of the Championship, League One and League Two are on course to accumulate £2bn of debt. And chairman Clarke is happy the trend is to be reversed after the successful vote on Wednesday morning. He said: "On the pitch we have three exciting, competitive divisions with crowds at their highest levels for 50 years. "But that success isn't necessarily being reflected on our clubs' balance sheets and we have to remedy that situation or face an uncertain future. "I'd like to commend the Championship clubs for the courageous decision they have taken today. "It means that for the first time, all 72 Football League clubs have agreed to take concerted action towards controlling their financial destiny." Youth investment and accounting charges from past spending on players and stadium-building will not be included. Leagues One and Two will continue to limit spending on wages to a proportion of turnover.
I like it although it shouldnt affect us. It means owners will have to put their money in rather than lend it Tango and Cash style. Thats what gets teams in trouble, owners not willing to run the club properly. Even if we went down, Id hope wed be back up before this happens, if not then Id hope out owners put money into the club rather than loan it. It also means a new stadium is a must, we cannot survive at Loftus Road.
**** me. That's ridiculously harsh. Especially fining a club for not balancing the books - let's face it, if they did that 2-3 seasons ago, Pompey, Cardiff and probably Leeds would go out of business. And they're just the first 3 to come to mind.
I suppose with the squad that we now possess it won't really affect us if the worse were to happen, I wonder which 3 teams were to object...i'm thinking Leicester, Cardiff and West Ham.
Although I like the intention this sounds like a fantastic way to unintentionally reduce the size of the League by driving clubs out of business. Also will make newly promoted teams even less competitive in the Prem.
In theory sounds alright but this will surely create an even bigger divide between the Prem and all below. It will also mean that the smaller will be under intense pressure, more than they are now, to sell their more talented players simply to balance the books. Also this will surely put off a megga rich owner wanting to invest into a club knowing he will make a loss in the first couple of years and then being slapped with a 100% fine? Or am I missing something. Only time will tell but does't look great at first glance.
It looks like an owner can pump money into the club but cannot continually loan the club money without taking risk himself. ie TF could sponsor us any amount he wanted to if he wanted Caterham F1 on our shirts.
UEFA, and by default the FL who are copying them are going to close that loophole. Exact details haven't been released yet, but UEFA have already said in the aftermath of the Man City stadium deal that money coming from 'related sources' or some similar term can be excluded from the calculations. (They can't stop the club receiving the money, but they can ignore it from the calculations) Relegated clubs get a year once they're down to fall in line with the rules, so newly promoted clubs should sign players up on 2 year contracts with an option on a 3rd year that they'll trigger if they stay up the first year. They've got the important things about youth and community projects not counting, and stadium building costs will count, but due to the way property is treated in accounts they're not likely to actually cost anything.
I can't see how they can really implement these changes long term? It is really financial unfair-play, how can it be fair for a team of say our size, getting 18,000 supporters for home games, in a city with 13 other professional clubs, to compete in the same league as a team with only 1 other club in their city, getting 76,000 supporters and turns over billions a year due to the stature of the club worldwide? The only way you can compete is by having a wealthy investor in the club, the plans being agreed to will basically stop this. All this will do is make the big clubs bigger and richer and will end with smaller clubs going out of business. That being said, there should be a system in place to stop clubs like Portsmouth, Luton and Leeds being run into the ground. I just don't think the way that UEFA is heading is necessarily the right one. I don't remember Michele Platini complaining about the unfairness of rich benefactors while he was making millions at Juventus???
But on the plus side Chelsea's fans that own the freehold on the pitch won't let them get a new ground so they'll be condemned to midtable obscurity for years to come.
That may be true, but they'd be in a league or two above us because ours only holds 18k and surely, according to UEFA, we wouldn't be allowed to borrow the £500m it would cost to build a bigger one?
You would. I know it says owners can't fund the club through loans, but I'm pretty sure that only refers to covering losses using loans, it shouldn't apply for the purchase of long term assets as that's funding the project not the club. I think it's the BBC being simplistic on the terms they're using, otherwise to the same meaning clubs won't be allowed to have a bank overdraft to let them pay wages over the summer when they're waiting to receive season ticket money from the credit card companies in October/November as that's effectively a loan from the bank. If you built a stadium for £500M the first stage of the accounting would be to split the cost over 50 years (a standard rule for property) so it would cost you £10M a year. The 2nd stage of the accounting would be to revalue it every year. So at the end of the first year the stadium is supposed to be worth £490M, with £10M having been written off. If when the valuers come round they say it's worth £495M then you'll get to deduct the extra £5M from the £10M cost so that it's only cost you the £5M that it's actually devalued by. (I'm not 100% on what happens if they say it's worth £485M, but I think you still only need to do the £10M a year) And for the loan that you've taken out, the repayments don't count as an expense, the only expense is the interest on it. So going back to the ABC loan that was £10M @ 10%, After a year the balance would be £11M. If you handed over £11M cash to settle it, then over the year it would only show as a cost of £1M for the interest, the £10M you'd handed over would be irrelevent in terms of profit/loss. So long as from your other trading you made enough profit to cover the cost of the interest and the fall in value of the stadium you would be within the rules. Oh, and existing debts won't be held against you, so long as you're making a profit even after paying the interest each year you'll be within the rules.
I think thats because Man city went so far over the top but we could up all of our sponsorship to levels similar to the top teams. How are they going to exclude that from the calculations?
Whenever rules are introduced clubs find clever ways of by-passing them, the same will happen here...
Has it really come to this level of stupidity? The FL want to impose added complications and fines on clubs they believe are poorly managed. Brilliant. Why don't they address the real reason clubs fail. Player wages.. Cap them at a level all clubs can compete fairly with and eliminate elitist monopolies like Utd, Chelsea et al. Encourage them to invest what they would have spent on player wages on player development and youth. Or better yet leave things alone and embrace the financial freedoms of capitalism.
Saints, Leicester and Reading were the 3 to vote against it. I know Saints and Leicester were not self sufficient but I thought Reading were run well.
