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  1. We sold Ince on the 4th July 2017, and Hughes on the 24th. The sale of one was included in the 16/17 accounts, the other wasn’t. There are suspicions Weimann’s transfer on the 3rd July 2018 will fall under the account period ending 17/18?
  2. £35m per year in the Prem. €30m (£25m) per accounting period (3 years) in UEFA competitions. I believe Man City’s issue is the source of their income. It seems their owners ‘influenced’ associated companies to sponsor them, boosting revenue, and meeting the limit. The PL isn’t a UEFA competition so UEFA rules have nothing to do with the PL
  3. Depending on specific circumstances, a sale on 1st July can still be included in the accounts in the 'previous year'
  4. Good to know. Neither did we Wrong. We receive more in sponsorship money. It tends to happen when you receive more publicity. It help when there's a 'big player' clause in a sponsorship deal. You really don't have a clue do you? That rule only applies to L1/2 clubs - those league have different financial rules to the Championship. Every penny of Rooney's wages count towards P&S
  5. The EFL currently is aligned, is it not? That's why we were able to sell our stadium for a P&S profit... PL rules allowed it but the EFL's (for Championship clubs) previously didn't. The rules were aligned so promoted clubs failing P&S would be punished by the PL (QPR being a prime example). Some obviously didn't check the rules before giving them the thumbs up..
  6. This comes down to a lot of Championship chairman believing the EFL's deal with Sky was vastly undervalued. In terms of the domestic TV deals, The Premier League gets £1.7b pa, whereas the EFL is £120m pa. From all of this, each L2 club gets around £1m, L1 get £1.7m, Championship £7.5m and Prem £100-150m [rough estimates] Average viewing figures on Sky are over 300k in the Championship, with the odd game getting close to 500k. Premier League games average 1.5m, but have been lower than 500k on a number of occasions, balanced out by topping 3m for a couple of games over the past decade. There's also the 5 year deal which limits the 3 divisions when technology is quickly advancing, which will leave us trailing further behind. One league being advertised considerably more than the other, resulting in the equivalent to 4 times as many viewers per game, but receiving almost 17 times more money (exc parachute payments). See why there's talk of a split from the EFL?
  7. According to Derby's statement, the EFL have even admitted to making a "mistake". It makes me think we'll be found innocent due to the EFL's incompetence, but rules re-written to prevent this happening in future. The only problem with that being the rules will no longer be aligned with the Premier League. Would we need to wait for them to change their P&S rules at the same time?
  8. iPro couldn't provide the funds promised, hence the deal coming to an abrupt end. I find it reasonable to assume allowances would be conceded by the EFL to consider the circumstances. The 2013 valuation was before the iPro deal, and the 2017 valuation was after the iPro deal. This is why I don't see naming rights as a factor in the valuation. I'm certain the same valuation method is mentioned somewhere... I'll try to dig it out when I have the chance. I'll be surprised if the method did change. I agree on a one size fits all approach, which I reckon our hearing will result in. Yep (as previously stated, I doubt we've taken this approach) I agree on a standardised approach, but I believe there are still 3 others (not including Derby's). 1. Amortised over original contract duration 2. Amortised over original contract duration but adjusted if a new contract is signed. [£4m on a 4 year deal = £1m per year. New 4 year deal after 2 years = £0.5m per year over remaining years] 3. Impairment if player suffers serious injury or club is relegated. I can't see us extending those deals to spread the financial hit. My best guess would be us hoping to get a fee for them rather than letting them go on a free. As players bought and sold within the 17/18 accounting period would have no net effect we can ignore those. Therefore, in this period, restated amortisation would increase, with no change in profit of sales. 18/19 - more profit on Vydra's sale may roughly balance out increase in amortisation 19/20 - No sales so no restated profit on sales Birmingham's an odd one regarding Adams. I seem to recall the EFL not happy with them not selling in January, but Birmingham actually receiving a larger fee in the summer. Blackburn, on paper look quite safe - but I haven't looked into how much the owner has been 'donating' so they may actually have a limit much lower than £39m. As for Reading... they're a cat 1 academy so academy exemptions (for P&S) will be around £5m, Looking at the club accounts, that would mean they're a few £m inside the limit for 18/19. but potentially around £10m over the budget for 19/20 (assuming little difference in wages). The one I cant get my head around is Fulham passing in 17/18, unless they paid out promotion bonuses of £20m+.
  9. £10m seems excessive for the players wwhose contract will expire at the end of the season. Forsyth - £200k signing in 2013, so little impact when released. likely £10-15k pw. Huddlestone - £2m signing. Small P&S impact when released. c£25k pw Bennett - Academy graduate, so little P&S impact when released. Low £1,000's pw. Anya - £4m signing and a big impact on P&S when released. c£30k pw. Martin - Free transfer, so little impact when released. c£40k pw. The worst case being what ever it costs to wipe out the amortisation remaining, will be balanced out by reduced wages. This also ignores the reduction in wages over the past 2 years, estimated to be £10m lower since the 17/18 season ended. In the case of Derby (club statement), the EFL Executive was involved in all stages of the stadium sale, as well as giving approval and signing it off in writing. The EFL also gave us written approval for the use of our amortisation policy. At the moment clubs with parachute payments seem to spend that money in the hope of going up before the tap's turned off. Once one of these club's is heavily punished, I expect the attitude of relegated clubs to change. Stoke are the ones to watch as they need to offload the high earners to reduce their spend on wages. But, at the same time, they can't sell anyone without making a loss on them, and harming their P&S results in the process. It's why they've loaned so many out rather than selling them. Instead of selling them for a bit of cash, P&S actually encourages them to do otherwise... that sounds like the opposite to what P&S is supposed to achieve. See my reply to the second quote above.
  10. Stadium Depreciated replacement cost basis on all 3 occasions. This seems to be the standard method for validating football stadiums? Amortisation “So does this method basically amortise until age 33 and if they leave before then, this remaining value goes against the accounts and if they leave at or beyond age 33, then the value is zero?” Yes. Using estimates for transfer fees and an age of 35 (average retirement age?), the resulting figures loosely tie in with the amortisation on the accounts, so this may be how we’ve done it, but I have my doubts. I don’t think there’s a chance we could get away with doing it this way. Rather than the residual value being at the end of the contract, I interpret it to be estimated value at the end of the final year of contract. Amortisation is then taken account of on a straight line basis between this point and the start of the contract, adjusted in case of a contract extension or impairment. We don’t tend to see values drop too much even with 6 months of a contract left (look at Bowen as an example). How we determine the residual value is uncertain - could be based on something similar to the retirement age mentioned above; maybe a % of the original fee, etc... The benefits last for as long as the players remain under contract. Johnson, Butterfield, Blackman and Thorne have all left the club in the current accounting period. Given they were signed for a combined £20m and left for nothing, it’s almost certain the stadium sale was with a view to when those players left. I’m not sure why we forced the losses on the first 3 into 2020 - they were given extensions until the end of this season, but were allowed to leave on frees back in July. If we are punished and previous figures restated, 2021 becomes a problem due to the unexpected (an non-budgeted) increase in amortisation during that period. I’m led to believe a club failing P&S have their losses for the failed years set to £13m (so as to not be punished multiple times for the same offence). If this is true, then Birmingham will be safe for the period ending 2019. Wednesday the only ones to watch when the 2019 accounts are released later this season. Reading and QPR to watch in 2020 - West Brom and Stoke may get dragged into this group if they’re still in this division.
  11. That may not be applicable in our case. The previous valuation was May 2013, whereas we didn’t complete the iPro deal until December 2013. Due to the unexpected collapse of the deal in 2017, I often wondered if we were given extra legroom for P&S for a year or two. I guess we’ll never know the answer to that though.
  12. Sorry for being late to the party. The two issues in this case being the stadium and amortisation. I was going to reply to a few comments in particular but a more general post may be more appropriate. Apologies in advance to the essay Stadium - independently valued by Jones Lang LaSalle who are the “the second largest company of its kind in the world” which suggests they won’t simply ‘help their mate Mel out’ (seem this on other forums) by overvaluing the stadium. The stadium was valued in 2007 at £55m (c£80m in today’s money) with depreciation of £1,375,000 per year. It was revalued to the same standard in 2013, with the book value depreciating at the same rate. Since 2007, a lot of improvements have been made including: big screens, pitch, concourse heating, cafe, bar/restaurant. The EFL were involved in every step of the transaction, and even told us to make adjustments for P&S purposes before approving our accounts. The only issue here could be if Derby misled the EFL, but given the club’s transparency through the process, you’d expect the to be flagged up when the accounts were submitted. Amortisation - This is more concerning issue for us due to the unusual policy within football since the Bosman Ruling came in to play - one of the practices being used was assigning a residual value equivalent to amortising a players value over the period until he reached 33 (typical retirement age of the time?). Potentially we’re doing similar now which is a bit dodgy. The method of assigning the residual values can only be guessed, but it’s reasonable to assume when signed, the assigned value at the start of the final year would represent typically value for a player of similar age. This has also been used since the 15/16 - this is where the following statement comes into play. “Had the EFL not given the green light in writing in respect of both charges, the Club would have reacted accordingly.” This is fairly obvious. If we weren’t given approval to use this accounting policy, recruitment and player retention would have differed greatly. We’ve acted in good faith believing we had done nothing wrong, and this remained the same until 2 weeks ago when the EFL made their statement. Over the duration of a player’s contract, there is no difference, but a big advantage is achieved for those first few years. The advantage we had is now gone, and the benefit is at a ‘breakeven point’. If we are found guilty for one of these two issues, we’d most likely pass P&S for the periods ending June 2018 and 2019, but fail 2020. If guilty of both, it would likely be a small fail for 2018, big for 2019 and extremely large for 2020 (and potentially 2021 too). However, given the “green light” comment from above, I struggle to believe the courts (if it went that far) would see fit for us to be punished. Personally, I believe we’ll end up getting a suspended points penalty (resulting in a big punishment if we fail P&S in the next couple of years), and the rules will be rewritten to prevent ‘unusual account policies’, and a set code for selling stadiums. Given the quality of our academy, the prospect of a transfer embargo is far from worrying. A couple of frees and/or loans (as allowed under the rules) in the 2 areas we lack depth is all we’ll be looking for - 1 CB out of contract in the summer is close to agreeing terms already.
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