Insolvency means that you can't pay your debts as they fall due. It is not a mathematical calculation on the balance sheet. Auditors will ask large creditors for confirmation that they don't intend to ask for repayment in the short/medium term. Didn't Chelsea convert the owners loans to shares? I'm sure he will have lent Chelsea plenty more since then, though!
Company Law isn't the issue. It's the phenomenal amount of money poured in by millionaire/billionaire owners, together with dodgy 'sponsorship' deals, that makes football totally unlike any other normal business. As you well know - so why accuse other people of sarcasm?
And you say I'm patronising!! Of course there is Company Law, one would have thought that would have gone without saying. What I am saying is there is no law to stop Billionaires ploughing their millions into their football clubs without any thought to normal business practices, ie. turning a profit. The basic principle here is there are different kinds of insolvency. If a club is insolvent because it's owner has loaned it money without any likelihood they will recall that loan then that really isn't insolvency.
Financial fair play will have an effect on that. I hope UEFA deal effectively with the sponsorship deals. Will Liverpool be able to throw money at their problems because they are not in Europe now and then cut back on expenditure once they get near the top 4?
The argument(s) in this thread are getting to be circular I know a man What man? A man with a power What power? The power of hoodoo Who do? You do I do what? You remind me of a man What man? A man with a power What power? and on....and on...and on...
You go and look at their freewebs page and you're presented with smiling pictures of Ibrahim Sonko, Ian Dowie and Caleb Folan. Ummm... right, fine, think I'll form my own branch
Thankyou Peter. I was actually being sarcastic as a response to your somewhat hectoring and patronising post.
Really? Where from and when? and at what point did you learn that the "accounting done on an economics and accounting degree is mickey mouse compared to that done on an accounting degree."?
Who owns Hull City? Allamhouse Limited Who was the biggest creditor in the last published account? Allamhouse Limited If any accountant can explain how that is anything but a positive situation is beyond me. Assam Allam was appointed to his role at Tempest Marine by who? The bank that was its biggest creditor. His role was to turn a failing business into a solvent business. Could the question on betting odds have been "how do they make Bruce the favourite" how does that work?" Now that would fit with Bruce not ever being in the running. Fez you are so ****ing right.
City of London Polytechnic 1974 - 1977. It was the first pure accounting degree in the country. Before my degree I investigated all courses with any significant accounting content. Over the years I have kept up to a certain extent with accounting education. My final year marks were based on ten 3 hour exams in one week at the end of the year. Coursework didn't contribute to the marks and there were no multiple choice questions.
When a business has creditors a lot greater than it's assets there is a worry. The creditors could demand repayment of the loans. It would be safer if the loans were converted into shares but it won't be done because of the hope that sometime in the future the Allams may want to get money out of the company and repayment of the loans will be tax free unlike the other two ways of getting money out of the company, ie. salary and dividends.
How are those loans accounted for in the new financial rules? Are we better having a huge debt, no debt or something in between? Does the debt being to a company associated with the Club chairman make a difference to how it sits with the rules?
This is an article on the rules http://www.bbc.co.uk/news/business-17843511 There's no rules about chairmen per se, it's more to do with owners. <<<And an "equity investment" is allowed, cash that can be put into the club by an owner or benefactor by way of equity, that is, cash for shares rather than debt. In other words, the money cannot be loaned to the club by the owner.>>> It would appear that an owner can subscribe for shares but can't lend the club money over certain limits. I would expect that there can't be circular transactions via friends or associates, either. <<<In Leagues One and Two, there are constraints for clubs with regard to the proportion of turnover that can be spent on wages.>>> The rules seem quite hit and miss though if anybody is really trying to get around them. I prefer the rules for UEFA Financial Fair Play Regulations which only apply to European competition. http://www.uefa.com/MultimediaFiles/Download/uefaorg/Clublicensing/01/50/09/12/1500912_DOWNLOAD.pdf They are much more detailed and complying with them may be onerous for a League 2 club. It seems like clubs in the Premier League but not competing for Europe can do whatever they want.
Hi Mel, plenty of scope to laugh at some folk! Lots of knobs in the world and not enough doors to open!
Just finished reading the last of Peter Bennetts wonderfully educational posts. What we all have to remember about this out and out arsehole is that everything stems from him being picked up for posting falsely - says much, knows nowt. He fires from the hip and his wit is ****, his technical knowledge is pants and his sarcasm is poor quality, even by the standards of these boards. The man's a ****, simple as! Is he the new James Lodge?
Once again I'm not sure what you're asking. You originally suggested I find out about the possibility of resurrecting the FLC and I said I would ask about it, because I know that the people I'm close to will have discussed it and would be able to answer that very quickly. As you know, the people I talk to are in charge of the OSC, so am I going to ask them to tell Mr Allam that they aren't representative? No, that'd be ridiculous. As I keep saying, I have no idea what your argument actually is apart formt hat you aren't happy with the OSC. He asked a fair bit about the situation with odds, but he definitely said he didn't understand what being 1/6 meant. He asked if he would get 6 pounds back for betting 1 pound, which of course is the wrong way round.
