Tranfer market

Well, Shad Khan is flying out to Costa Rica next week to have discussions with Jol. Mr Khan has also inserted the Jacksonville Jaguars President on the Fulham Board. So I guess we’ll have to hold our breath.

Reading a bit about he how went about business with the Jags, I don’t get the impression that he’s the kind of guy that says, “here’s a transfer kitty of £xm, go spend”. Rather, I think he’ll look at suggested purchases on a player-by-player basis. And very much looking at the player’s future value - for example if he’s currently undervalued and would fit our need or if it’s thought that the player has high re-sale potential.

That’s not to say, Mr Khan won’t put up a decent amount of capital for transfer fees. However, I believe he’ll only do it if he thinks it’s got a prudent financial outcome.

I can't understand this, surely with financial fair play around the corner, his hands are tied in the transfer market? We would have no way of breaking even with such a small capacity so how are we going to be spending £20m+ without having to sell players?

Yes, I agree, it does seem problematic. Though the FFP does have a 3 year break even period early on and investment in the stadium and youth is not part of FFP. So maybe an initial spending boost, to be covered by increased income from ground expansion??

Only guessing.

then Norwich and the saints have spent well, we need younger players and quickly

I suspect we will be in for a bit of a rollercoaster ride in the transfer market.
No doubt a few press will mention us when marquee signings are up for sale,
will we now be mentioned being in competition with Liverpool, Everton, Tottenham etc
when it comes to press gossip.
But going on Jol's previous transfer history he has stuck mostly with players
that he has had knowledge from previous european leagues and teams.
Will he become more adventurous ?

Bandit said:

I can't understand this, surely with financial fair play around the corner, his hands are tied in the transfer market? We would have no way of breaking even with such a small capacity so how are we going to be spending £20m+ without having to sell players?

Click to expand...

What about the £20m we got for Demps and Dembele? I know it was a while ago but I'm not sure how it works, we've only spent about £4m since them.

Bandit said:

I can't understand this, surely with financial fair play around the corner, his hands are tied in the transfer market? We would have no way of breaking even with such a small capacity so how are we going to be spending £20m+ without having to sell players?

Click to expand...

"Fair Play" is about revenue not capital spend on transfers. So it's about the wages we pay new acquisitions although gate receipts come in to this equation when it comes to balancing the 'fair play' balance sheet.

On "what has happened to the money?" question raised by others, there is also "what has happened to the £17m raised in the Virgin Islands against the anticipated extra TV revenue?". I had always assumed that this was going to be used as the first installment towards developing the Riverside. Mr K has said that development of the 'stadiun' is his priority, so hopefully that still holds.

I wonder if Jol now has a bigger budget he may think about getting Enoh and Emanuelson on permanent contracts.
He said when we loaned them that he couldn't buy them cause they were out of our price range.
They played and settled in last season, which would be a bonus. The only thing is would they stop any of our younger
players from getting in the team.
It's rumored Diarra may be off to Panathinikos, but not much news for others who have been let go.

He will probably spend wisely... And as such I would like to see the team spending.

Regarding Diarra, it seems that his knee is gone completely and Panathinaikos are not risking it. If he stays around the best bet is on a game per game pay or something.

Cottager58 said:

"Fair Play" is about revenue not capital spend on transfers. So it's about the wages we pay new acquisitions although gate receipts come in to this equation when it comes to balancing the 'fair play' balance sheet.

On "what has happened to the money?" question raised by others, there is also "what has happened to the £17m raised in the Virgin Islands against the anticipated extra TV revenue?". I had always assumed that this was going to be used as the first installment towards developing the Riverside. Mr K has said that development of the 'stadiun' is his priority, so hopefully that still holds.

Click to expand...

I think you'll find that Transfer spending is amortised over the length of the contract and treated as revenue C58.

toshchamberlainsmate said:

I think you'll find that Transfer spending is amortised over the length of the contract and treated as revenue C58.

Click to expand...

Thanks Tosh. That would make sense and might explain something which has been puzzling me - in our last set of published accounts (2011/12) there was an ammortised entry of £18.6m, which in effect was the 'trading loss' for that year:





I had always taken "amortisation" to be the 'written-off value' of players (in other words, a player is potentially worth less to the club as his contract runs down) and allowed as a deduction for tax purposes, which is what seems to have happened here. What I couldn't figure out was why it was so high.

To be honest I'm still puzzled. If the 'amortised amount' was treated as revenue it would be an addition not a subtraction, wouldn't it? I don't know - has "amortisation" more than one definition/application/purpose?

Where's that accountant Surlyc?

The depreciation is writing down the book value of assets. So a player on a renewed contract may have been worth 5m on the day he signed it but only 4m after 12 months = 1m depreciation in that year.

Amortisation is saying that if we pay 5m for a player and give him a 5 yr contract then there is a 1m per year revenue cost, instead of a 5m capital cost.

Amortisation is not allowable for tax purposes. It is purely an accounting issue, it is reversed back out of your income statement when you calculate taxable profits. It is also an expense, rather than revenue; you're writing down the value of an asset and lowering the overall value of the club.

It's worth noting that the club's accounting date is 30 June - meaning that the departures of Kamara and Greening fall into the period. The period would also include the first quarter of Bryan's fee, as well as quite possibly the last quarter of AJ's and assorted other transfer fees. It's also worth noting that depreciation/amortisation is not just player fees - all assets acquired and held by the club will be depreciated, with the exception of land.

Edit - Having gotten home and actually looked at the accounts, I thought the following were interesting:

- Transfers between the balance sheet date (30 June) and the date of signing (10 December) realised a profit of £14m. I think that pretty much confirms what we knew; Dembele, Dempsey and Dickson out for £22m and Berba, Lister and Ashkan in for £8m.
- We wrote down the value of our playing staff by £3m. I wonder if we expected to release a large number of players this summer anyway?
- Amortisation of player registrations was £17.7m.
- We sold/released players with original transfer costs of £23m. That'll be players like AJ, Zamora, Greening, Salcido, Paintsil and Gera. These players had a carrying value of only £3m at the beginning of the year.

Thanks guys and especially for that breakdown Surly.


Think I'd better stick to the day job.

As long as your day jobs not an accountant Cottager, otherwise your clients are in a bit of trouble.

roscafre said:

Another name added to our want list Odemwingie,lets hope its just paper talk.
33 next birthday with an attitude problem.i dont think so.

Click to expand...

Couldn't think of a player less fulhamish that we would sign. Old, high wages, attitude problem and hasn't played for quite some time. I can't imagine any PL team being in for him, let alone one that's just been taken over by a billionaire!

Paper talk