Hull City's debit balance on profit and loss account has been reduced from £39.7 million to £18.6 million. Allamhouse is still owed £60 million by Hull City at 31 December (note 11). The group has £11.5 million in the bank (which includes other group companies as well as Hull City). Hull City needs to generate significant amounts of cash between 1 January to the end of the financial year to be able to repay the loan to Allamhouse in my opinion. Of course I may have misread the accounts.
Just starting to look at these. I know there's no politics but I'm wondering why the Allams have made political donations to the West Hull Labour Party and a conservative MP in Wales (unless the auditor is required to make at least one typo in each set of accounts).
Slightly worrying statement in the Director's report (unless it's just delusional - I'm probably reading too much into it). Football (...Although the Well it would make much more sense. But it's shoddy and makes me question everything else that the accountants have done.
Basically its the difference between assets and liabilities and how much profit (or loss) the club is making. In Hull City Tigers Limited's accounts in July 2017 the debit balance was £39.7 million in Allamhouse's accounts dated December 2017 the debit balance is £18.6 million. In very broad terms Hull City Tigers Limited have made a profit of around £20 million in the period July to December 2017. I was expecting the profit to be bigger.
I'm not an accountant and I'm probably nit-picking a bit but I always thought assets and liabilities were balance sheet items, and P&L showed the profit or loss.
Term I've never heard before. What correlation is there between the difference between assets and liabilities and profit? They're two completely different measures, one an as at figure and one over a period of time.
Generally if you make a profit you add to the assets of the company. If you make a loss you add to the liabilities of the company. In Hull City's case the losses we incurred in the past were funded by loans from Allamhouse. Where there is a debit balance on the profit and loss account any profits would increase the assets, such as cash in bank, which could then be used to reduce the liabilities. So the assets could remain broadly the same but the liabilities go down. This is what happened last season, the Premier League profits were used to reduce the amount outstanding to Allamhouse. If they are going to get their money back they have to make sufficient profits to repay the loan or else transfer the debt to a third party. If you want to get into technicalities then a company's assets and liabilities can remain the same if the profits are paid out in dividends or the losses are funded by an increase in share capital. Neither of these apply in Hull City's case. I hope I've explained it properly. Accountancy is one of those areas that look fine in my head but is difficult to explain to someone else.
So in short ? We are still in debt to the Allams to the tune of £60m ? Despite the landslide of monies from the Premier League and transfers ? Or have I missed something here ?
Hm, normally profits are transferred to Retained Earnings, but I kind of get what you're saying. It's a bit of a convoluted way of looking at it. You can be adding to your assets while making a loss, or conversely taking on more liabilities but making a profit (less likely, admittedly). I guess I've never heard of a P&L Account in the manner you describe, maybe a difference between accounting over here and in the UK.
Unless they waited until Jan 1st, then paid themselves a load of coin, so it didn't appear in the accounts until after the next transfer window.
Its easy to increase your liabilities whilst making a profit buy your assets will be increasing faster than your liabilities. Looks like what we call a P and L Account is your Retained Earnings account.
That's why I looked at the group bank balance. It stood at just under £11.5 million. Just under £0.8 million is in Allamhouse's bank account leaving £10.7 million for the other group companies. Nowhere near enough to pay the £60 million debt. When Allam Marine's accounts are published to the public we will be able to see how much of the bank balance, stock and trade debtors is theirs rather than City's. That would give us a better idea on what assets Hull City have to pay the debt. Have you any idea on how the Premier League monies are paid? As its for wages on relegation it would seem logical it was paid in straight monthly amounts. Which makes me wonder how much the monthly expenses are otherwise I'd have expected to see a larger bank balance as the club acquires cash to pay off the debt.
Someone on Talk Sport was saying last night that Allamhouse showed a profit of £54million. Money from transfers in that period £56million.
I can't remember how we get the payments, I remember reading it somewhere, but I can't find it now. It's staged payments, but not monthly (unless it's changed), it's paid in a few installments through the season.
