Accounts due today

[old wittonian]

I put my accounts in weeks ago

Single page?

 

[Deleted member 4099]

We’ve spent more than we should!

 

[Deleted member 6754 (removed at own request)]

PriceOfFootball on Twitter

 

[Urko]

PriceOfFootball on Twitter

They’re either in complete denial or don’t understand basic FFP rules.

Expect a points deduction &/or transfer embargo

 

[Pinhead]

They’re either in complete denial or don’t understand basic FFP rules.

Expect a points deduction &/or transfer embargo

here's hoping

 

[Dudleywolf]

I said this some time ago, Villa make Blues's Misdemeanour on FFP look like scrumping compared to grand Larceny !

 

[BlahBlah]

They’re either in complete denial or don’t understand basic FFP rules.

Expect a points deduction &/or transfer embargo

but, but....."they're minted".

If i read that right, they lost £38 million excluding wages, which could be another £60-70 million ?

 

[Tring Wolf]

but, but....."they're minted".

If i read that right, they lost £38 million excluding wages, which could be another £60-70 million ?

Yep. That’s how I read it too.

Points deduction looming...

 

[Deleted member 5962]

Little bit of a issue here for me. The players wages are on the books of a seperate company to Aston Villa FC according to that twitter thread.

Is that not third party ownership?

 

[The Professional]

I bet they get away with it.

 

[Deleted member 3751]

but, but....."they're minted".

If i read that right, they lost £38 million excluding wages, which could be another £60-70 million ?

That's also how I read it. It appears a blatant disregard for FFP, next few days/weeks could be interesting

 

[JadeWolf]

Tom Watson will be writing to the Prime Minister again.

 

[Deleted member 5962]

PriceOfFootball‏ @KieranMaguire
Replying to @MrPBateman84
True, my understanding is that Villa were 48 hours from liquidation last summer

 

[Dingle Chris]

These have been filed today and are being processed so should be available either tomorrow or the day after.

 

[De Wolfs Mullet]

The accounts are up. £55m loss for the financial year

 

[Bill McCai]

2017 figures in brackets

Profit/Loss
-£55.15m ( -£20.5m )

Turnover
£26.4m ( £23.7m )

Wage bill
£50.7m ( £28.2m )

STH
21,233 ( 13,757 )

Av Attendance
28,298 ( 21,572 )

Since May 31 we have spent £109.65m on players.

 

[Kashmire Hawker]

Perks of pesky Wage Bill demands to put it simply!

We shouldn’t be too worried, particularly with STH’s up, turnover up, revenue up and much more.

2018/19’s should put us back in the Black, with the huge numbers of the Premier League coming into play.

 

[North West Wanderer]

So no premier league income included as of yet. How much is this roughly?

 

[Deleted member 3751]

Time to be thankful for promotion bonuses (assuming they're in that colossal wage bill) not being counted by FFP and amortization I think! Otherwise we'd have obliterated the £39m limit

 

[stuj4z]

What actually is counted by FFP now? Nothing makes much sense

 

[paddy]

If you’re a big club you count what you like and allocate across any club or business you own

 

[Deleted member 3751]

What actually is counted by FFP now? Nothing makes much sense

First team costs essentially, mainly transfer fees and basic wages. Promotion bonuses aren't counted because they're only payable if you get promoted. Then you also get to amortise your spending in FFP, whereas the official accounts will take it all out as a straight profit/loss

At least this is how I believe it works! Slight differences but the big £55m loss will be way above what we've lost with regards to FFP

 

[Guzeppi]

Which goes to show, attendance is nice for the atmosphere and the support it gives to the team, but in the larger financial picture turnover is not drastically improved:

Attendance up by 31%
Turnover up only 11.4%

The money you bring in at the turnstiles, although important, is not a vital part of your finances.

Some might say duh... sherlock.

But it goes to show that survival in the premiere (outside top 6) and the chump needs money from marketing, sponsorships, and television and a tightly run ship.

Getting a larger capacity is not as good a money making venture as it seems, but rather a means to keep the supporters happy.

Or do a Southampton equivalent of a puppy farm and sell off every good player that comes through the ranks and always hope to find the next batch of good kids that can see you through another season to only sell again once they start wanting higher wages.

 

[kennyB]

Does this have any effect on this season or in future? Does it make any difference in future spending? Just asking if there is some bright accountant or someone who understands accounts better than me. (Not difficult).

 

[Deleted member 5242]

I do like having a browse through these analytical finance threads, but I always end up coming out the other end still non the ****ing wiser!

 

[WickedWolfie]

I bet they get away with it.

l seriously doubt it. The EFL really wouldn't want to face Blues, QPR, Pompey, Luton and every other team they've punished for FFP in Court in front of a proper judge to explain the inconsistency...

 

[Guzeppi]

Does this have any effect on this season or in future? Does it make any difference in future spending? Just asking if there is some bright accountant or someone who understands accounts better than me. (Not difficult).

Of course it has an effect. Everything does.
However, this is not a bad financial picture. From an economist point of view.
Looking forward, you can say that the increased loss is a necessary capital expenditure, an investment for short-term to medium term growth.

It all depends on the other branches of the "business":
Marketing, television, sponsors.

All these will definitely see the turnover increase hugely in the next annual accounts.

Shirts alone sold to record levels. Television income will be huge compared to previous rates. Shirt sponsors are also expected to have paid more (I would hope). I also would expect a large increase in advertising revenues.

And as unpalatable as this may sound, we have appreciated the value of assets. Many of our players are now worth more on the market.

The accounts that matter are the next 2-3 years as to whether Wolves are really back and here to stay with the big boys.

And yes, getting into Europe won't hurt, all you silly gooses that want Wolves to stay home.

 

[Poztin]

Does this have any effect on this season or in future? Does it make any difference in future spending? Just asking if there is some bright accountant or someone who understands accounts better than me. (Not difficult).

FFP is over a rolling 3 year period, so these losses will eat into what we’re allowed to lose in current/future years.

In 2016/2017 we posted a loss of £23m.
In 2017/2018 we now post a loss of £55m.

There are exclusions for FFP though (e.g. academy etc) so those numbers will be lower for FFP calculations.

For this year, the two (FFP adjusted) losses above plus projections of 2018/2019 accounts will be used for FFP calculations.

So in short yes, it will affect how much we are allowed to lose but given our activity last summer I doubt there is much to worry about regarding losses for FFP.

Our biggest issue is the yearly constraints on wage increases.

 

[Chris H]

First team costs essentially, mainly transfer fees and basic wages. Promotion bonuses aren't counted because they're only payable if you get promoted. Then you also get to amortise your spending in FFP, whereas the official accounts will take it all out as a straight profit/loss

At least this is how I believe it works! Slight differences but the big £55m loss will be way above what we've lost with regards to FFP

When you say you get to amortise your spending in FFP, you don't amortise everything, just anything classed as an asset, such as a players transfer fee which is amortised over the contract length. You can't amortise day to day costs as they are accounted for as they occur.

Player transfers are amortisable because that player continues to hold a value to the club (i.e they "own" the player and he will usually only move on through being sold) over the length of the contract.

I'm unsure if you can amortise signing on fee's as part of the initial cost mind, I can't say I've ever done accounts for a football club...

 

[Deleted member 4099]

Does this have any effect on this season or in future? Does it make any difference in future spending? Just asking if there is some bright accountant or someone who understands accounts better than me. (Not difficult).

Only if we go down. Bournemouth were in a similar position when they came up.

 

[Poztin]

It does raise the question of how we managed to pass FFP last year though using SwissRambles analysis from last year as a basis.

As with a £55m loss for 2017/2018 that would put us over the allowed loss limit of £39m.

 

[Deleted member 3751]

When you say you get to amortise your spending in FFP, you don't amortise everything, just anything classed as an asset, such as a players transfer fee which is amortised over the contract length. You can't amortise day to day costs as they are accounted for as they occur.

Player transfers are amortisable because that player continues to hold a value to the club (i.e they "own" the player and he will usually only move on through being sold) over the length of the contract.

I'm unsure if you can amortise signing on fee's as part of the initial cost mind, I can't say I've ever done accounts for a football club...

Yeah that's what I meant. Spending as in transfer spending. Most day to day costs as far as I'm aware don't count towards FFP anyway.

Was actually wondering as to whether every transfer fee would get amortised or just the significant ones... we'd still be showing a payment of about £800 a year for Matt Doherty!

 

[SakosRightFoot]

Worth remembering of the transfers we signed permanently under Fosun we did on nice long 5 year contracts to offset the fee on ffp and loaned others on effective hire purchase so our ffp losses will be way lower than the actual book loss.

 

[JOSWolf]

I wonder what Fulhams accounts look like?

 

[Bill McCai]

£110m on players:

Boly £10m
Afobe £10m
Patricio £18m
Jota £12m
Vinagre £5m
Moutinho £5m
Bonatini £5m
Traore £18m
Dendonker £12m
Jonny £15m

Something like that I’d imagine.

 

[Chris H]

Yeah that's what I meant. Spending as in transfer spending.

Was actually wondering as to whether every transfer fee would get amortised or just the significant ones... we'd still be showing a payment of about £800 a year for Matt Doherty!

Just read in the accounts, signing on fee's are also amortised. So I expect there were some hefty signing on fee's for some of our players to enable us to pay reasonably low wages in order to aid with FFP. Suspect this is why Neves for instances got a new contract in the summer, another chunk of money as a signing on fee for the renewal of his contract that can then be spread over 5 more years.

All transfer fees would be amortised I'd imagine, as every player is an asset of the company regardless of how significant or not the actual fee is. I don't know it for a fact, but I'd say the initial transfer fee plus signing on fees etc would be amortised over the initial contract period. When a player is given a new extended contract, the remainder of the balance not yet amortised along with any new signing on fees etc would then be amortised again over the new contract length.

So If the total transfer amount and fees etc is £10m on a 5 year contract it would be £2m a year. If they then sign a new 5 year contract after 2 years there would be £6m left, say another £1m in signing on fees etc then the £7m would be amortised over a further 5 years which would be £1.4m a year.

I'd imagine Doherty's £75k is down to about a tenner a month now! Although I suspect he got a decent signing on fee with his new contract...

 

[wolvesjoe]

View attachment 9204

It does raise the question of how we managed to pass FFP last year though using SwissRambles analysis from last year as a basis.

As with a £55m loss for 2017/2018 that would put us over the allowed loss limit of £39m.

Those figures are based on a projection for this season as if we were still a championship club.

So they need adjusting for Premiership status, which means a much higher permissible loss figure, (35m),
and a much higher income figure, which leads to a very different profit/loss calculation.

Also important to remember, that the FFP applies not a one season basis, but as averages over any given
three years. This means that Wolves were inside the regulations for season 2016/17 as the two previous years
of profit were taken into account. However it does look as if Wolves were over the the FFP cumulative total
of 39m loss for seasons 2015/16, 16/17, 17/18. More detail on the character of the losses, and, in particular,
if some of the losses were involved in training ground improvements, and Academy development. This would
be excluded from the FFP calculations.

Dalrymple did say at one point last season that Wolves would be in a difficult situation if they had not been promoted,
with regards to FFP and hinted that sales would have been necessary to stay within the guidelines.

 

[Deleted member 6754 (removed at own request)]

First team costs essentially, mainly transfer fees and basic wages. Promotion bonuses aren't counted because they're only payable if you get promoted. Then you also get to amortise your spending in FFP, whereas the official accounts will take it all out as a straight profit/loss

At least this is how I believe it works! Slight differences but the big £55m loss will be way above what we've lost with regards to FFP

When you say you get to amortise your spending in FFP, you don't amortise everything, just anything classed as an asset, such as a players transfer fee which is amortised over the contract length. You can't amortise day to day costs as they are accounted for as they occur.

Player transfers are amortisable because that player continues to hold a value to the club (i.e they "own" the player and he will usually only move on through being sold) over the length of the contract.

I'm unsure if you can amortise signing on fee's as part of the initial cost mind, I can't say I've ever done accounts for a football club...

If you look through the accounts carefully, it does state that player amortisation is already taken into account in the loss figure.

From page 2: "Player trading in the year generated profit of £8.1m through disposal of players' registrations but this was outweighed by higher amortisation and impairment charges on player registrations of £16.1m, primarily driven by investments in the first team squad in recent years, including Neves, Costa, Cavaleiro and Saiss, resulting in a net Player Trading loss of £8.0m."

And on page 10, the Profit and Loss Account, it states Player trading operating expenses as a loss of £16.1m (as above), and Profit on disposal of players' registrations of £8.1m (as above), providing a "Loss before net financing" in the player trading column of £8.024m (as above). So it's fairly certain the underlying figures in these accounts have taken amortisation into account already.

 

[Chris H]

£110m on players:

Boly £10m
Afobe £10m
Patricio £18m
Jota £12m
Vinagre £5m
Moutinho £5m
Bonatini £5m
Traore £18m
Dendonker £12m
Jonny £15m

Something like that I’d imagine.

Dendoncker and Jonny wouldn't be part of those figures as Jonny was January and Dendoncker will be the summer.

I did this a while ago, just updated it for Patricio's fee and Jonny: -



Of that, as I'd say Jonny and Dendoncker wouldn't be in last years accounts, and I'd guess Patricio may not as it was resolved months later. So take those 3 out and its not too far out.

 

[Bill McCai]

The £110m is post balance sheet events so would include Jonny and Dendonker