His book value is nil as he's an Academy product. He had no transfer fee. So it's all booked this year.
The FFP thread
- Thread starter SydneyTiger14
- Start date
-
Please bear with us on the new site integration and fixing any known bugs over the coming days. If you can not log in please try resetting your password and check your spam box. If you have tried these steps and are still struggling email [email protected] with your username/registered email address
-
His book value is nil as he's an Academy product. He had no transfer fee. So it's all booked this year.
That makes no sense. You book the receivable when the transfer is made and recognise revenue. It's no different to any purchase made on credit.
When a player is sold you write off any book value (for klp, that's nil) and recognise all revenue. You then book that against a receivable, and then recognise the amount of cash received against that receivable.
You don't recognise revenue in the following years.
We haven't spent 11.5m in fees this year. And it isn't about averaging 13m ffs. Stop repeating it as it it's true.
IF there's really such a thing as an FFP issue it will be an issue of wages not around breaching the 39m cap.
Just to throw more confusion into the debate over ffp, isn't the amount of losses we can sustain a year £5 million, giving a total of £15 million over the three years? Maybe I'm thick and reading the regulations incorrectly.
I thought that was something to do with COVID losses, that up to 5m we could apply to have written off.
That's the other element that Orange is missing though, just because we're spending something doesn't make it a loss. We have record sponsorship deals, increased gate receipts, potentially increased merchandise income, to go with the KLP income. People really are getting their knickers in a twist because Baz reported we met with the EFL a few weeks ago, and now some random on twitter has made a claim.
The 11.5 m figure in fees is Baz's number, not mine. What have we spent?
Trying to get my head around where you're coming from. IF the total transfer fee, regardless of when paid counts as profit in the year sold for FFP purposes, then it's unlikely that we fall foul of FFP this year, but the majority of financial commitment we are making this window is wages in the next 3-4 years. Unless we can count the KLP money twice then 16m only goes so far.
The 11.5m is what we are paying over the life of the contracts of the players we have purchased. Our P&L in a single year is calculated off the amount of each of those fees that will be amortised this year. Listen to the Price of Football podcast if you're genuinely interested in this stuff, it explains it in more detail than I can on a Monday morning pre-coffee.
Of course it only goes so far, but as OLM started by saying, all that matters is FFP compliance this year. Next year we might be in the PL. Next year we might have sold Greaves. Next year we might have another sponsorship deal. Next year Acun may get another investor onboard and inject a bunch of equity into the club. Next year's accounts are to worry about next year. You can't fall foul of FFP in a preceding year just because 'maybe' you'll have issues the next year.
I also don't think you can assume even with the huge amount we're spending that we are really racking up those sorts of losses before we get a look at the accounts, because the new revenue streams we have opened up will be doing their bit to offset a lot of the expenditure.
No. Losses can only be stood up to 5m if the owner doesn't agree to provide equity to cover the losses in a given assessment period.
Basically we are allowed to lose average 13m a year in a rolling 3 if the owner covers those losses.
Otherwise we can only lose 5m a year average over a rolling 3.
Maybe it is something to do with this which is causing the problem?
I doubt it isn't surmountable though.
I can't imagine the club don't know the rules and they're still in the market doing deals.
If KLP went to Brentford on tick wouldn’t the full value of the sale go through the books in total this financial year and any outstanding amount will be in the debtors which will still be there next year if it’s not paid off?
Maybe that makes it a better idea to sell players on tick with regards FFP and the money from the sale will stretch over a longer period?
Maybe that makes it a better idea to sell players on tick with regards FFP and the money from the sale will stretch over a longer period?
I'm suggesting its the club being diligent not to risk breech in coming years by overcommitting.
Theres no suggestion that we are in current breech, just that it's a current consideration.
Last edited:
If it's a consideration not a breach then there's no means for it to hold up a transfer which is where we started. If we all agree there's no current issue with FFP then maybe we can agree that the tweet suggesting there was on was rubbish and draw a line under this.
I'm saying it's something to keep an eye on. Like Longman and Jones. And what comes out about Nwakaeme.
Ali - four year deal = 0.625m this year
Tufan - three year deal = 1.33m this year
Sinik - three year deal = 1.2m this year
= 3.16m this year
And that's 3.2m spent, not loss incurred. Two very different things.
If we're also playing this game, we'll be owed more income on the Bowen transfer due to clauses being triggered now he's played for England and scored a certain number of goals. These clauses wouldn't be recognised as income initially as they were conditional.
Seri,. 30k a week, Nwakaeme 30k a week. Tufan, Figs???
That's the bulk of the financial commitment. Not the fees. It must be to do with wages or future years. We might have found something to agree on
Seri,. 30k a week, Nwakaeme 30k a week. Tufan, Figs???
That's the bulk of the financial commitment. Not the fees. It must be to do with wages or future years. We might have found something to agree on
If you understand what I mean by wages.. I know there's a condition in the PL that you can only increase your wage bill by a certain % each year. It caused a lot of frustration for Everton after their takeover but looks like it's saved them a fair bit of wastage. I wonder if there's similar in the Championship.
Although I've just had a look and can't see anything. Found this table though:
You must log in or register to see images
Have no clue what's changed since then (as this looks quite old) but was the most relevant Google result.
Elsewhere in the article it talks about average being 13m loss but in this table it says 13m in a single season, which is two quite different things (and I think this table is worded slightly wrong as you can offset a loss in a season with profit from previous seasons). (EDIT: Should have read the final column
)As to the owner equity issue, since as you and others claim, Acun is digging into his own pocket quite a bit, that's not a concern.
No, I'm saying he's spending/ committing more than simply the KLP fee, and isn't showing signs of stopping, not since last Mondays FA meeting anyway. the Nwakaeme deal was obviously 'done' then supposedly now on hold since then.
Don't know exactly how he's financing it, but suspect sponsorships and media revenue will be part of it.
Then 'he' is not financing it, the club is. If Acun is spending his own money then we can lose more than 5m. I don't even think we will lose 5m this year or next anyway so this discussion is becoming rather silly and speculative.
FFP has come up more than once now. And again, one of the sources says FFP issue is being resolved, so I'm sure the next week or two will be interesting.
If we are bringing in the likes of Nwakaeme (or that level signing) and transfer policy continues then it's obviously nothing to worry about.
