kentish wolf
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Forgive me in case it has been mentioned elsewhere. But what financial restrictions will the club have in the transfer window?
Good question. What with our transfers last window, I‘m not sure what we can spend.Forgive me in case it has been mentioned elsewhere. But what financial restrictions will the club have in the transfer window?
Sales wash through in year of sale whereas purchases span length of contract plus in Morgan’s case this is all profit.Gibbs-White wasn't all up front though?
The sceptic in me is always amazed after one of the “big 6” goes on a spending spree do they close a particular loophole to stop others exploiting it and catching up. I imagine if we’d done what they have been doing there would be a fine on it’s way along with a points deductionChelski caught out bending the rules with very long contracts .Uefa to restrict to five years .
Uefa to CHANGE transfer rules for FFP after Chelsea's January transfer spree
CHELSEA’S January transfer policy is set to see a change in Uefa rules – to stop clubs manipulating Financial Fair Play regulations. The Stamford Bridge club’s eye-popping £400million spendin…www.thesun.co.uk
In a normal situation but clubs sign up to play in a league and the league has rules in place. It's open to another Bosman case IMO. The minute it gets challenged in Court, the whole system changes again.I'm no expert on this, but I don't see how you can tell a club what length of contract they can give to an employee. You wouldn't get away with it in any other industry.
You can have any length of contract but it can only be amortised over a maximum of 5 years rather than the length of the contract. UEFA are setting the accounting rules rather than the contract rules.I'm no expert on this, but I don't see how you can tell a club what length of contract they can give to an employee. You wouldn't get away with it in any other industry.
You can have any length of contract but it can only be amortised over a maximum of 5 years rather than the length of the contract. UEFA are setting the accounting rules rather than the contract rules.
They can give as long as contract as they want but for amortisation they are capping it at 5 so 100m over 7 years will still be 20m a yearI'm no expert on this, but I don't see how you can tell a club what length of contract they can give to an employee. You wouldn't get away with it in any other industry.
Regards to FFP (for this season at least), we have nothing to worry about, obviously spending a lot of money will have a knock on effect if we don't claw a big chunk back each season, whether that be through sales (we got good money for MGW this season) or building other revenue streams. So further down the line we might have a problem, but this season we're fineForgive me in case it has been mentioned elsewhere. But what financial restrictions will the club have in the transfer window?
I hate the big 7 as a rule but I actually see what Chelsea have done and ask why no non big 7 did the same? I know you see a fine and a points deduction but surely that would only happen if youre guilty of something. Chelsea are not guilty of anything other than exploiting a loophole. Its a gamble though as paying up 8-10 year contracts could bankrupt you!The sceptic in me is always amazed after one of the “big 6” goes on a spending spree do they close a particular loophole to stop others exploiting it and catching up. I imagine if we’d done what they have been doing there would be a fine on it’s way along with a points deduction
Can't necessarily spend higher, our amortisation costs were about £62m last released finances, that won't have gone down by much before we started spending again and with the signings we've made it could be as high as £100m now, could even be over that. So that increase in yearly outgoings needs taking into account before throwing more money at it. Selling Neves could just mean we break evenWe have to sell someone in the summer ie Neves or Nunes then we can spend again higher
Another poster develops victim mentality. Points deduction???The sceptic in me is always amazed after one of the “big 6” goes on a spending spree do they close a particular loophole to stop others exploiting it and catching up. I imagine if we’d done what they have been doing there would be a fine on it’s way along with a points deduction
Some did just differently.I hate the big 7 as a rule but I actually see what Chelsea have done and ask why no non big 7 did the same? I know you see a fine and a points deduction but surely that would only happen if youre guilty of something. Chelsea are not guilty of anything other than exploiting a loophole. Its a gamble though as paying up 8-10 year contracts could bankrupt you!
Well we go into a new year so if we sell someone for 50m for example should let us spend 75m but then it has a knock on effect following season. Hence why Everton are in the creek with no paddle point taken. If we stay up it won’t be big spending unless we revamp the whole squad and I wouldn’t bet against that either. Julen is known for overhaulCan't necessarily spend higher, our amortisation costs were about £62m last released finances, that won't have gone down by much before we started spending again and with the signings we've made it could be as high as £100m now, could even be over that. So that increase in yearly outgoings needs taking into account before throwing more money at it. Selling Neves could just mean we break even
There are more forces in play of course, but best not to think we can go and spend higher again just because we sell a valuable asset
I hate the big 7 as a rule but I actually see what Chelsea have done and ask why no non big 7 did the same? I know you see a fine and a points deduction but surely that would only happen if youre guilty of something. Chelsea are not guilty of anything other than exploiting a loophole. Its a gamble though as paying up 8-10 year contracts could bankrupt you!
Not how it works. Amortisation is a yearly 'bill' and any player you've ever bought that is still at the club will be adding cost to that bill. Crude example is if we were at £60m costs and upped that to around £100m with the signings we've made, we covered that increase by selling MGW, Dendoncker and Vinagre. But next year, despite it being a new year we still have that new £100m cost, if our regular finances mean we can only cover £70m of it, we could sell Neves for £30m and it just covers the deficit, it doesn't give us leeway over and above to spend againWell we go into a new year so if we sell someone for 50m for example should let us spend 75m
I feel a bit thick that I still don't get these rules, maybe someone can help me out!
We buy a player for £50m tomorrow (no. 9 please) on a 5 year contract. We've spent £50m but have a player worth the same, so the value of the club is the same. However for FFP we've spent £50m and we can't spend more than 70% of turnover. However what we actually do it pay £10m a year for 5 years. Each year we knock that £10m off the book value of the player as his contract runs down (I thought that was what amortisation was?). So if we have say £140m turnover we are still paying e.g. for Semedo £6m a year towards that, but Cunha is only costing us £9m for this year's FFP? So Chelsea can only do this if the selling clubs have agreed to take payments over 8 years?
UEFA sanctions i would expectLooking up the EPL seems to have written more lax rules than UEFA, so teams can try to 'compete with the Big 6'. How will that work when someone breaks UEFA rules in order to get into European football?
Chelsea have done nothing wrong. It's not a loophole that's been exploited, it's common sense being used.The sceptic in me is always amazed after one of the “big 6” goes on a spending spree do they close a particular loophole to stop others exploiting it and catching up. I imagine if we’d done what they have been doing there would be a fine on it’s way along with a points deduction
Unfortunately that's not the way you draw up accounts for any business. Revenue and capital expenditure are different matters. If FFP used different accounting principles you wouldn't easily be able to view or control it using the normal financial statements, which would still need to be prepared.I don't really think the amortisation (or whatever) shpuld be a factor. To me, whatever has been spent on transfer fees, wages etc in that year should be part of your FFP. If you buy someone for 20m, with 10m this year. And the other 10m in installments, i think the 10m should go on this year, regardless of length of contract. Given players often leave before the end of their contract or get given new ones, or cancelled, it seems like it is just a way to manipulate figures. I get the player can be seen as an 'asset', if boight an asset outright for £1000 today and planned to have it for 10 years, i still pay £1000 in 2023, not 100 for 10 years. I would have the potential to sell the asset, but wouldn't see that money until any transaction.
Maybe it is a too simple way of thinking, but to me it is 'what have you paid out this year and what money have you received' the difference being your profit/loss
I appreciate you have your own experience, and i am not foreign to accounting, i'm just saying, for me, that the bread and butter is what has physically gone out of the bank and what is physically coming in to the bankUnfortunately that's not the way you draw up accounts for any business. Revenue and capital expenditure are different matters. If FFP used different accounting principles you wouldn't easily be able to view or control it using the normal financial statements, which would still need to be prepared.
It doesn't work like that because in the process of paying the transfer fee you acquire an asset of the same monetary value so your P&L is 0 until he end of that year when you have to depreciate the asset.I don't really think the amortisation (or whatever) shpuld be a factor. To me, whatever has been spent on transfer fees, wages etc in that year should be part of your FFP. If you buy someone for 20m, with 10m this year. And the other 10m in installments, i think the 10m should go on this year, regardless of length of contract. Given players often leave before the end of their contract or get given new ones, or cancelled, it seems like it is just a way to manipulate figures. I get the player can be seen as an 'asset', if boight an asset outright for £1000 today and planned to have it for 10 years, i still pay £1000 in 2023, not 100 for 10 years. I would have the potential to sell the asset, but wouldn't see that money until any transaction.
Maybe it is a too simple way of thinking, but to me it is 'what have you paid out this year and what money have you received' the difference being your profit/loss
But it isn't when some, most, of those outgoings are spent on high value assets that either depreciate or, occasionally, gain in value and are not generally purchased with the intention of making a profit in a particular trading period. Players are not trading stock. It would be like a logistics company showing its purchase and sale of trucks in the profit and loss account. It would completely distort any view of the company performance in those periods where they invested in the assets that enabled them to undertake thier trade. Similarly not writing down the value of those assets over the period they were in use would result in a distortion of the value held on the balance sheet.I appreciate you have your own experience, and i am not foreign to accounting, i'm just saying, for me, that the bread and butter is what has physically gone out of the bank and what is physically coming in to the bank
So it's the "Big 7" now ? .............. It used to be "Top 4" then "Sky Six" and now "Big 7" .................. and still the Government do nothing about this inflation !!I hate the big 7 as a rule but I actually see what Chelsea have done and ask why no non big 7 did the same? I know you see a fine and a points deduction but surely that would only happen if youre guilty of something. Chelsea are not guilty of anything other than exploiting a loophole. Its a gamble though as paying up 8-10 year contracts could bankrupt you!
Regards to FFP (for this season at least), we have nothing to worry about, obviously spending a lot of money will have a knock on effect if we don't claw a big chunk back each season, whether that be through sales (we got good money for MGW this season) or building other revenue streams. So further down the line we might have a problem, but this season we're fine
I didn't say that for one minute. And i didn't insinuate investment can't be taken account. I merely csme here to state my opinion on how i think it should be in ffp, not to be condescended. Anyway, to use a business term, if i'm allowed, i'm outYou can't just consider cash in vs. cash out
Apologies if it came across that way that wasn't my intention.I didn't say that for one minute. And i didn't insinuate investment can't be taken account. I merely csme here to state my opinion on how i think it should be in ffp, not to be condescended. Anyway, to use a business term, if i'm allowed, i'm out
Very true, but even more than this, it is the intention of FFP regulations to look at the amount of "investment" in player assets in that context of the actual turnover and worth of the clubs as an ongoing business. So the idea that you could use a cash in cash out basis to adjudge FFP is flawed in itself, irrespective of the understanding of accounting practice.Apologies if it came across that way that wasn't my intention.
Problem is that the clubs won't want to be preparing two completely different sets of documentation based on two completely different accounting systems comes year end.