FFP for a thickie

[Parkfieldswolf]

Can anyone explain FFP in simple, layman’s terms? I’ve tried looking into it, got confused, bored and felt like a thicko. How much can we spend, how can it be spent etc? Anyone?

 

[Alex Rae The Substitute]

My understanding is we can only operate losses of a certain amount each season, and must stay within those parameters.

Prior to qualifying for Europe we sustained losses in the championship which were deemed of a legal amount in that division but not allowed under Europa league parameters. Unfortunately we were victims of our own success and in qualifying for the Europa we moved into UEFA’s rules and got fined for falling foul of their loss allowance in the seasons before we qualified and now have to operate within a certain limit for the season just gone and the season that lies ahead.

That’s as simply as I can put my understanding, and it may well be very wrong!

 

[wwbug]

Simply if you became rich before the rules, you are like a pig in **** . Keeping the top six in situ.
So if I left £500 million to Wolverhampton Wanderers in my will they still couldn’t do anything about building a better team.

 

[reanswolf]

It is very confusing, but I thought the losses clubs built up were examined over 3 year periods, not annually.

 

[Parkfieldswolf]

My understanding is we can only operate losses of a certain amount each season, and must stay within those parameters.

Prior to qualifying for Europe we sustained losses in the championship which were deemed of a legal amount in that division but not allowed under Europa league parameters. Unfortunately we were victims of our own success and in qualifying for the Europa we moved into UEFA’s rules and got fined for falling foul of their loss allowance in the seasons before we qualified and now have to operate within a certain limit for the season just gone and the season that lies ahead.

That’s as simply as I can put my understanding, and it may well be very wrong!

So our spending this close season is still very much restricted by the FFP ruling by EUFA?

 

[SuperGran]

So our spending this close season is still very much restricted by the FFP ruling by EUFA?

Yes we can’t have losses of more than 30m otherwise we can have further sanctions
So if we register a loss of less than 30m at the end of this 3 year period we’re good to go at the start of next season.

 

[Parkfieldswolf]

Yes we can’t have losses of more than 30m otherwise we can have further sanctions
So if we register a loss of less than 30m at the end of this 3 year period we’re good to go at the start of next season.

So with these restraints in mind why are some getting in a twist at our possible minimum outlay this summer? Surely if the club explained in thicko terms to us fans we would all know the reasons we’re not splashing the cash.

 

[wwbug]

So with these restraints in mind why are some getting in a twist at our possible minimum outlay this summer? Surely if the club explained in thicko terms to us fans we would all know the reasons we’re not splashing the cash.

Because it not fair . It’s just not fair …..( exit left stamping feet )

 

[USA Wolf]

Thought this was a personals ad at first glance

 

[SuperGran]

So with these restraints in mind why are some getting in a twist at our possible minimum outlay this summer? Surely if the club explained in thicko terms to us fans we would all know the reasons we’re not splashing the cash.

They have but people don’t like it or don’t believe them

 

[Black Country Wanderer]

Uefa have relaxed their FFP rules so you can go over that figure if the owners cover the deficit to adjust for the pandemic losses
Prem rules are different where you can lose £35 million a season i think but its been awhile since i looked at that so may be more

 

[Parkfieldswolf]

Thanks for all the replies. It’s still confusing but it does seem we may be being hamstrung by FFP. I think the club could explain it and spell it out a bit better to the fans though.

 

[Leominster_Wolf]

Can anyone explain FFP in simple, layman’s terms? I’ve tried looking into it, got confused, bored and felt like a thicko. How much can we spend, how can it be spent etc? Anyone?

Really really simply......

PL - max £105m losses over rolling three year period ( are other rules around players wages and things)

UEFA - max €30m over rolling three year period

certain expenditure is exempt, such as infrastructure and academy/youth teams

 

[SuperGran]

Really really simply......

PL - max £105m losses over rolling three year period ( are other rules around players wages and things)

UEFA - max €30m over rolling three year period

certain expenditure is exempt, such as infrastructure and academy/youth teams

BUt viLlA

 

[Leominster_Wolf]

I will add there has been relaxation both in PL and UEFA due to pandemic - but we are worse off due to our breach For our year in Europe. Whilst I am sure the relaxation will apply, it would not be possible for us to take the P

we had to give a commitment to break even, but our revenue decreased by approx £40m, so I’m sure we would be allowed a comparable loss.

if we’d spunked an additional £100m up the wall, that would be seen as taking the ****.

 

[sedgwolf1980]

Surely Guo can just sponsor a match ball for £500million?

 

[SuperGran]

Uefa have relaxed their FFP rules so you can go over that figure if the owners cover the deficit to adjust for the pandemic losses
Prem rules are different where you can lose £35 million a season i think but its been awhile since i looked at that so may be more

Not for us though because of being too successful in our Europa qualification

 

[Pagey]

FFP = **** fans politely

 

[rincewind]

Surely Guo can just sponsor a match ball for £500million?

Sadly not. Any sponsorship by the owners or one of their companies has to be at what is considered market value.

 

[Pagey]

Sadly not. Any sponsorship by the owners or one of their companies has to be at what is considered market value.

City blew that out the water

 

[waggys left foot]

It's ironic that the UEFA version of FFP was designed to stop Citeh and PSG ,clubs owned by countries with vast wealth buying any player and winning everything ,and ends up snaring us just because we were an overnight success.

 

[Bondi Wolf]

We undertook to break even in the three seasons ending in 2020, 2021 and 2022 as part of our plea deal with UEFA. We made a loss of 30m euro in 2020 so we need to have a surplus in last season and next season combined. But as we aren't in Europe for next season I'm not sure what we are obliged to do

But as every club has lost heaps of money last season then we will have to find out what that means for us. It's impossible for FFP to work last season. It's not like all clubs can sell as nobody has money to buy.

As far as this related to buying players in the summer, the amortization of players fees helps a lot. If we were to sell Adama for 25 million that would let us buy 100 million of players on four year contracts, as the player fee is spread over the years of the contract for accounting purposes.

Buying youth really is the key to winning at FFP on the assumption that a player will be worth the same or more at some time in the future, instead of the journeymen we bought in the nineties that had no value at the end of their contract.

 

[SakosRightFoot]

It is very confusing, but I thought the losses clubs built up were examined over 3 year periods, not annually.

They are both sort of. It’s a rolling 3 year cycle so this years examination no longer takes into account the big loss in the championship, but we know the pandemic has meant less tv money

 

[forge]

I will add there has been relaxation both in PL and UEFA due to pandemic - but we are worse off due to our breach For our year in Europe. Whilst I am sure the relaxation will apply, it would not be possible for us to take the P

we had to give a commitment to break even, but our revenue decreased by approx £40m, so I’m sure we would be allowed a comparable loss.

if we’d spunked an additional £100m up the wall, that would be seen as taking the ****.

Fair point lol

 

[VancouverWolf]

.

My understanding is we can only operate losses of a certain amount each season, and must stay within those parameters.

Prior to qualifying for Europe we sustained losses in the championship which were deemed of a legal amount in that division but not allowed under Europa league parameters. Unfortunately we were victims of our own success and in qualifying for the Europa we moved into UEFA’s rules and got fined for falling foul of their loss allowance in the seasons before we qualified and now have to operate within a certain limit for the season just gone and the season that lies ahead.

That’s as simply as I can put my understanding, and it may well be very wrong!

let me see if I got this right.

We had losses that were legal in the Championship and then next season we qualified for the Europa.
How much did we PROFIT, ( we had to fly, hotels, food, staff etc ), from the Europa? I think we made about £12m from the Europa, right? Anyone?

So now UEFA is punishing us over 3 years and it will impact our transfers.

Seems to me it might have been better to say to UEFA.....” Thank you, but we can’t play in your competition as we would we in fault with your rules.”

Of course there’s probably a rule against this.

 

[Mile End Wanderer]

Can anyone explain FFP in simple, layman’s terms? I’ve tried looking into it, got confused, bored and felt like a thicko. How much can we spend, how can it be spent etc? Anyone?

We’re still under European ffp for two seasons so don’t expect us to do much until after then really

 

[VancouverWolf]

We’re still under European ffp for two seasons so don’t expect us to do much until after then really

I never have nor never will. All these decades has taught me to just wait and see......anything else is a fool’s game.

 

[Mile End Wanderer]

I never have nor never will. All these decades has taught me to just wait and see......anything else is a fool’s game.

We will be able to improve but we are in transition now more than ever

 

[Deleted member LP 3925]

So, to take this thickie explanation to the next level, the next question would be, how much do we realistically have left to spend on transfers in these 3 years if:
- We keep those new signings’ wages within expected levels
- the transfers are of grown-ups for the first team squad
- structural and youth team costs are taken off the expenditure figures
- someone could provide a reasonably accurate idea of income and adjusted expenditure over these three years
- we don’t do weird ways of structuring deals like Liverpool paying us 50p a year for Jota. In other words ‘We agree a fee of £30 million for Talisca, here’s £30 million, thank you.’
- we ignore the reality of real world forces, Fosun’s business objectives, etc.
- we take into account any other inaccuracies and assumptions I’ve made or missed.

Who has the answer, anyone?

Or is it easier not to think about it and to be like Villa, spend/spaff £100 million a year for a while on hit or miss transfers, sell your ground to yourself, ignore everything but gradually improve, and hoping that UEFA have worse cases to focus on if you do actually qualify for Europe?

I think I’ve just bored myself!

what’s the magic number? One Bruno Fernandes? 35 Greg Halfords?

 

[TrueWolf]

Any figures banded around are just speculation and guesswork as no one (except Wolves) have the exact figures for transfer fees, wages, bonuses etc.

In addition no one knows the exact incomes and losses after Covid or the level of allowances for reduced incomes from Covid.

So you may as well pluck a random figure out of the air than even try and work it out.

 

[WKFWolf]

they have confirmed a couple of times in the Q&A that we are constrained by UEFA until the end of next season as a result of us getting into Europe 'too quickly' after promotion and our champ losses.

its clear to see as we have been doing loans to buy and sell to invest

will be the same this summer, then hopefully some more investment next year again without having to sell

 

[SingYourHeartsOut]

Never really understood this to be honest, if we buy a £50m player and pay in used tenners on the day then we have less cash and an asset to the same value, is that a loss?

 

[Parkfieldswolf]

Thanks for the info all. So in a nutshell we’ve fallen foul of UEFA. FFP rules mainly because we were a little too quick in being successful and gaining a place in the Europa league. So all the talk of levelling out the financial playing field is just that really......talk. I’ve read that FFP hasn’t worked and just made the closed shop of top clubs even more difficult to break into but now I’ve read some of these replies I know that is the case. FFP has made it virtually impossible to become a genuine contender so the way we have tried to do it buying youngsters and players using Mendes is the only way we can hope to circumnavigate FFP. Oh well at least I know now that the club are trying and just how difficult the powers that be have made it for us. Leicester by the way must have been hated when they surprisingly won the PL and got Champions League football a while back.

 

[SuperGran]

Thanks for the info all. So in a nutshell we’ve fallen foul of UEFA. FFP rules mainly because we were a little too quick in being successful and gaining a place in the Europa league. So all the talk of levelling out the financial playing field is just that really......talk. I’ve read that FFP hasn’t worked and just made the closed shop of top clubs even more difficult to break into but now I’ve read some of these replies I know that is the case. FFP has made it virtually impossible to become a genuine contender so the way we have tried to do it buying youngsters and players using Mendes is the only way we can hope to circumnavigate FFP. Oh well at least I know now that the club are trying and just how difficult the powers that be have made it for us. Leicester by the way must have been hated when they surprisingly won the PL and got Champions League football a while back.

The crazy thing is we’d have been better off financially to miss out on Europa league then we’d be able to spend what we wanted

 

[maws]

Did Fabio count as a youth infrastructure investment, please uefa.


Happy days

 

[Pintandkebab]

So if we went out and signed 200 million pounds worth of players what would happen . Banner from European competition for a couple of seasons ( we are not going to be in Europe for that period anyway ) and a large fine .

 

[Deleted member LP 3925]

Any figures banded around are just speculation and guesswork as no one (except Wolves) have the exact figures for transfer fees, wages, bonuses etc.

In addition no one knows the exact incomes and losses after Covid or the level of allowances for reduced incomes from Covid.

So you may as well pluck a random figure out of the air than even try and work it out.

Exactly. I posted partly tongue in cheek. There are a few financial wizard posters that like to use the term ‘amortised.’ Fair play to them. Maybe one of them might give a guesstimate.

 

[Pompey Wolf]

So in summary then, we would have been much better off not being in Braga/Barca drinking the lager while the Albion ****** were back home.

 

[Leominster_Wolf]

Any figures banded around are just speculation and guesswork as no one (except Wolves) have the exact figures for transfer fees, wages, bonuses etc.

In addition no one knows the exact incomes and losses after Covid or the level of allowances for reduced incomes from Covid.

So you may as well pluck a random figure out of the air than even try and work it out.

In fairness the income losses are quite clearly stated in Wolves and every other clubs accounts.

 

[SakosRightFoot]

So, to take this thickie explanation to the next level, the next question would be, how much do we realistically have left to spend on transfers in these 3 years if:
- We keep those new signings’ wages within expected levels
- the transfers are of grown-ups for the first team squad
- structural and youth team costs are taken off the expenditure figures
- someone could provide a reasonably accurate idea of income and adjusted expenditure over these three years
- we don’t do weird ways of structuring deals like Liverpool paying us 50p a year for Jota. In other words ‘We agree a fee of £30 million for Talisca, here’s £30 million, thank you.’
- we ignore the reality of real world forces, Fosun’s business objectives, etc.
- we take into account any other inaccuracies and assumptions I’ve made or missed.

Who has the answer, anyone?

Or is it easier not to think about it and to be like Villa, spend/spaff £100 million a year for a while on hit or miss transfers, sell your ground to yourself, ignore everything but gradually improve, and hoping that UEFA have worse cases to focus on if you do actually qualify for Europe?

I think I’ve just bored myself!

what’s the magic number? One Bruno Fernandes? 35 Greg Halfords?

I think the confusion comes because people think we get this big pot of money every year and have started on zero.

Perhaps the best way to think of it is to compare to your yearly salary. So you get a certain amount of money every year, say £25,000, but you don’t have £25k to spend as you already have a mortgage, car, other bills. You’ve already committed to spending a lot of that money.

In Wolves terms the wage bill is probably more than half the tv income, then we’ve had a net spend on transfers in the last 3 years of about £175million (really rough don’t quote me on that) so we’re now at a point where much of our tv income is already spent on existing bills.