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The Championship FFP Thread (Merged)


Mr Popodopolous

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Off the top of my head.

Think Reading must be in danger...unless there is some major item in their accounts that we aren't aware of yet.

Already sold the ground and their profit in 2016/17 will drop off...they looked to sell it at market rates I am sure because the profit was nothing like the big 3- Aston Villa, Derby and Sheffield Wednesday- but when released from a soft embargo they swiftly (within a month anyway) purchased Puscas and Joao!!

Birmingham maybe, albeit a small breach so a small penalty- bit of an unknown- or they might be fine this time to June 2020.

We already have the existing Derby, Sheffield Wednesday cases- who knows if a rolling breach would see them fail last and this season too.

Think Blackburn in a tight spot but okay as of now, ie to June 2020 or whenever their Reporting Period finishes- Stoke could be tough going into next (if we have a next!) season. Noises coming out of Stoke make me think they could try some accounting tricks.

Bit less at risk, Nottingham Forest- maybe but they've sold quite well this season. QPR have some headroom but the end of parachute payments this season won't help- should be fine in both cases for this season though.

Also worth noting that equity limits change things...if equity stuck in it's £13m per season, equity up to £8m, if not it's £5m- but that could literally be anything between £1-8m of equity- ie £1 as opposed to £1m, so you stick a pound in it's £5m + £1 and so on.

There's one big unknown of course- whether Aston Villa will face scrutiny as and when they come back! I fear they are fine but...

Their club statement says they have complied with EFL regulations but there are a few unknowables:

  1. Like with Derby and Sheffield Wednesday, they- especially Derby- were clearly considered fine when Shaun Harvey ran the show. Rick Parry seems much different! Derby even put out a statement last September stating that they had complied...
  2. Still with those 2 clubs, will they- and the bulk of the compliant division- accept Aston Villa not getting any proper EFL scrutiny- both of those got charged well after the event for a start once further investigations uncovered things.
  3. Can someone- anyone- explain to me how Loans Receivable which was how the Villa Park Sale and leaseback was done, can count as profit under the regulations?

Dunno if they offset loans to the equivalent of the sale price and in return got Villa Park? Seems very sketchy from a regulatory POV.

Edited by Mr Popodopolous
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For the sake of comparison- essentially and quite rightly so it seems that the EFL can change tack if or when new evidence comes to light:

Last September, not long after news got out about the EFL commissioning independent valuations.

Didn't seem to help them did it! The bolded bits are not dissimilar...actually Derby went quite a bit further and deeper! It aged well. ?

Quote

Announcement on Financial Results

Exceptional promotion-related costs of £45.8m including a one-off £30m contingent payment to former owner Randolph D Lerner were substantial contributory factors in the £68.9m loss recorded in Aston Villa’s group accounts for the year ended May 31, 2019 published today. 

The Club’s ultimate parent company, NSWE SCS, introduced £30m by way of a capital injection to enable the Club to settle the liability when former owner Recon Group Limited defaulted on the payment.

The payment was made in accordance with the provisions of the purchase agreement of May 2016 between Recon Group Limited (Buyer), Randolph Lerner / Alfred Lerner Declaration of Trust (together the Sellers) and Zhejiang Ruikang Investment Co. Limited and Jian Tong Xia (together the Guarantors).

The terms of the agreement stipulated that if Recon Group Limited and the Guarantors failed to pay the £30m bonus due to the Sellers on Aston Villa’s promotion back to The Premier League, the Club would be liable for the payment.

On June 6, 2019, Recon Group Limited (Hong Kong) confirmed default on the payment. The liability was settled through payment on July 12, 2019. As a result, the Club made provision for a £30m liability in the 2018/19 year-end accounts.

NSWE SCS is wholly owned by Wes Edens and Nassef Sawiris.

During the year the ownership group introduced £105.7m into the Club all of which was in the form of capital injections which resulted in Aston Villa remaining debt free.

Aston Villa can confirm that in the 3-year period ending May 31, 2019, the Club complied with the EFL’s Profitability & Sustainability Rules. After promotion, The Premier League reviewed and confirmed compliance in accordance with their own policies and procedures.

Turnover in the financial year to May 31, 2019 was £54.3m, a fall of £14.3m compared to the year ended May 31, 2018. This was primarily due to a reduction in Premier League parachute payments in the third successive season the club competed in The Championship.

Quote

Derby County Football Club has adhered to the EFL’s Profit and Sustainability Rules with respect to the sale of its stadium.

The stadium was subject to an independent professional valuation before sale, nearly 18 months ago, and the EFL indicated in writing that the arrangement was in accordance with its rules and regulations.

The EFL cannot now, long after approving the arrangements, suggest Derby County breached the rules.

The Club regrets that Middlesbrough Football Club have said they are suing the EFL over the matter, but that is a matter for them. Derby County offered to show Middlesbrough its financial records but they declined the invitation and appear to have decided to bring a claim against the EFL instead.

The outcome of that action could not now affect Derby County, which has already had its financial returns for the relevant season approved by the EFL, and the Club is solely focussed on the current season.

The Club will not be making any further comment at this time.

 

Edited by Mr Popodopolous
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The FFP thing is interesting.

Kieran Maguire, as of a few days ago,  believes that existing cases may well carry on as usual, I say clearly the tribunals themselves won't but the process, the fact they have already begun.

However that it might be suspended for the 3 years to this season.

I'm guessing that the Derby and Sheffield Wednesday cases won't be shelved, 3 years to May/June 2019- well it's a bit trickier but the period beginning in 2017/18 to be assesses for this season, yeah shelve it.

Edited by Mr Popodopolous
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8 hours ago, Olé said:

Plot twist (someone else to sell the ground to)

 

What about the other club - Wayne Rooney's Derby County - are they not part of the deal?

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Some clubs are spawny, lucky I must say. 

Aston Villa spring to mind, Derby possibly maybe another, with respect to finance, FFP etc.

One bit of news. EFL have dropped/withdrawn the charges against Chansiri, Meire and Redgate. 

To be specific and clear, these are the personal misconduct charges. 

Part of me wonders if they are not pushing too hard on this aspect due to the exceptional circumstances. For example, might the very solvency of Sheffield Wednesday have been in doubt had Chansiri been banned, in these times with no revenue flowing in?

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2 hours ago, Mr Popodopolous said:

Some clubs are spawny, lucky I must say. 

Aston Villa spring to mind, Derby possibly maybe another, with respect to finance, FFP etc.

One bit of news. EFL have dropped/withdrawn the charges against Chansiri, Meire and Redgate. 

To be specific and clear, these are the personal misconduct charges. 

Part of me wonders if they are not pushing too hard on this aspect due to the exceptional circumstances. For example, might the very solvency of Sheffield Wednesday have been in doubt had Chansiri been banned, in these times with no revenue flowing in?

Very flimsy if charges have been dropped due to totally unrelated world events. Surely even the FL would not stoop so low?

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2 hours ago, havanatopia said:

Very flimsy if charges have been dropped due to totally unrelated world events. Surely even the FL would not stoop so low?

It's another one of Pop's famous conspiracy theories.  He thinks that the whole world is conspiring against lil old Bristol.

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1 minute ago, Delta said:

It's another one of Pop's famous conspiracy theories.  He thinks that the whole world is conspiring against lil old Bristol.

Shouldn't you be self-isolating?

 

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2 hours ago, Delta said:

It's another one of Pop's famous conspiracy theories.  He thinks that the whole world is conspiring against lil old Bristol.

What is apparent to non belter trolls,  is that the FL do not want a punishment to jeopardise a clubs future. 

Shaun Harvey was careful with the massive fine QPR got- he did not want it to risk them going into administration or worse.

@havanatopia I'm suggesting that maybe it might not have been a top priority for them. Had Chansiri been banned, would he have continued funding them?

I honestly don't know but it was notable that this wasn't thrown out by the Independent panel as such, more that the EFL dropped them- maybe were accepting the inevitable granted but there's no published judgement etc online anywhere.

I'm not wildly bothered if Chansiri is banned or similar, my hope is that Sheffield Wednesday get their comeuppance.

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9 minutes ago, Mr Popodopolous said:

What is apparent to non belter trolls,  is that the FL do not want a punishment to jeopardise a clubs future. 

Shaun Harvey was careful with the massive fine QPR got- he did not want it to risk them going into administration or worse.

@havanatopia I'm suggesting that maybe it might not have been a top priority for them. Had Chansiri been banned, would he have continued funding them?

I honestly don't know but it was notable that this wasn't thrown out by the Independent panel as such, more that the EFL dropped them- maybe were accepting the inevitable granted but there's no published judgement etc online anywhere.

I'm not wildly bothered if Chansiri is banned or similar, my hope is that Sheffield Wednesday get their comeuppance.

I just wonder whether the current unprecedented situation will give the EFL a get out of jail free card, as regards clubs that have potential ffp issues, either on the horizon or under investigation.

No one yet knows the extent of the financial fallout when things get back to normal and I can well imagine the EFL seeing it as an opportunity to wriggle out of awkward confrontations by effectively wiping the slate clean, on the premise of not wanting to jeopardise any clubs future.  I'm not suggesting it is the right thing to do, but depending on ho long it takes for football to return to normal, quite a few clubs could be financially on the ropes and you can bet the EFL would not then want to be seen as the bad guys, by taking action that could tip a club over the edge. 

They would probably dress it up as an opportunity to re-write the rules, having "learned the lessons`' of the mistakes when drafting the current rules.

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On 10/03/2020 at 17:30, Mr Popodopolous said:

ESwnxWJXYAAKQWQ?format=jpg&name=large

Oh yes...

Yes indeed!!

Maybe I'll book some leave if it's open to the public.

Just you and one other attending now Mr P! :) 

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15 minutes ago, downendcity said:

I just wonder whether the current unprecedented situation will give the EFL a get out of jail free card, as regards clubs that have potential ffp issues, either on the horizon or under investigation.

No one yet knows the extent of the financial fallout when things get back to normal and I can well imagine the EFL seeing it as an opportunity to wriggle out of awkward confrontations by effectively wiping the slate clean, on the premise of not wanting to jeopardise any clubs future.  I'm not suggesting it is the right thing to do, but depending on ho long it takes for football to return to normal, quite a few clubs could be financially on the ropes and you can bet the EFL would not then want to be seen as the bad guys, by taking action that could tip a club over the edge. 

They would probably dress it up as an opportunity to re-write the rules, having "learned the lessons`' of the mistakes when drafting the current rules.

Maybe the rules can be relaxed due to the effect of CV, but CV cannot and must not be used as an excuse for the misdemeanours that occurred before.

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2 minutes ago, wendyredredrobin said:

Maybe the rules can be relaxed due to the effect of CV, but CV cannot and must not be used as an excuse for the misdemeanours that occurred before.

one caveat rovers can't suddenly in vest billions.

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7 hours ago, Mr Popodopolous said:

What is apparent to non belter trolls,  is that the FL do not want a punishment to jeopardise a clubs future. 

Shaun Harvey was careful with the massive fine QPR got- he did not want it to risk them going into administration or worse.

@havanatopia I'm suggesting that maybe it might not have been a top priority for them. Had Chansiri been banned, would he have continued funding them?

I honestly don't know but it was notable that this wasn't thrown out by the Independent panel as such, more that the EFL dropped them- maybe were accepting the inevitable granted but there's no published judgement etc online anywhere.

I'm not wildly bothered if Chansiri is banned or similar, my hope is that Sheffield Wednesday get their comeuppance.

In what way is it apparent Pops?  Do you have evidence to support this claim or have you just included the word "apparent" in order to add value to your claim?

You yourself have stated many times that there are numerous sanctions available.  If wrongdoing has occurred then it should be addressed.  In this case, the league have decided that no wrongdoing has occurred and you have decided that this is because of Covid 19.

In your blinkered world, everyone is guilty and those who are not charged have benefited from some warped conspiracy theory or other.

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7 hours ago, downendcity said:

I just wonder whether the current unprecedented situation will give the EFL a get out of jail free card, as regards clubs that have potential ffp issues, either on the horizon or under investigation.

No one yet knows the extent of the financial fallout when things get back to normal and I can well imagine the EFL seeing it as an opportunity to wriggle out of awkward confrontations by effectively wiping the slate clean, on the premise of not wanting to jeopardise any clubs future.  I'm not suggesting it is the right thing to do, but depending on ho long it takes for football to return to normal, quite a few clubs could be financially on the ropes and you can bet the EFL would not then want to be seen as the bad guys, by taking action that could tip a club over the edge. 

They would probably dress it up as an opportunity to re-write the rules, having "learned the lessons`' of the mistakes when drafting the current rules.

I'm not quite sure why you think the league are faced with "awkward situations"?

They seem to have dealt with both Birmingham and QPR swiftly and effectively.

I have every confidence in the league dealing with these issues fairly.  Points deductions will still be implemented if wrongdoing has occurred and there will be little room for sympathy (that's just a silly suggestion) as Bolton and Bury will confirm.

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3 sets of results from last season.

Wigan- lost £9.2m last season. That's inclusive of Profit on transfers etc. Only have headline figures.

Huddersfield (in the PL)- made a profit of £3.85m. 

Fulham (in the PL) - made a loss- a LOSS- of £20,448,00. May yet be higher given that Fulham Football Leisure is the immediate parent company and Fulham Cougar HoldCo the ultimate undertaking.

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11 minutes ago, Mr Popodopolous said:

Thanks. 

Surely that stuff should be on hold in these exceptional times.

I agree but can also see it from other teams situation that it’s been only 2 home games at most so why do clubs need to cut wages so dramatically. Is it because they are on the brink of FFP and where is the missing deferred wages coming from if they can’t pay now.

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57 minutes ago, wayne allisons tongues said:

I agree but can also see it from other teams situation that it’s been only 2 home games at most so why do clubs need to cut wages so dramatically. Is it because they are on the brink of FFP and where is the missing deferred wages coming from if they can’t pay now.

I think it's more cashflow- remember most clubs at this level a) Pay in excess of 100% of turnover in wages and b) Make a loss anyway, even with these exceptional times. You then strip out gate receipts, commercial revenue, etc etc- how is TV money paid as well, is it all in one lump sum or is it in stages?

FFP might be a consideration for some of course, and the League need to look at this closely to see if it isn't a getout.

There is a little thing called solidarity too...why should some get a free pass when society has some significant problems/hardship/people taking a hit in this crisis? Including many fans of clubs. Is the country all in it together or not?

Lastly, if I'm an owner why would I want to subsidise further when I'm already underwriting losses- all in it together is bollocks anyway but let's not at least confirm it.

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As for Rovers and their losses.

I don't think they're that bad considering. Clearly a lower cost base in League One than the Championship- the latter is worst from all angles as high stakes gambling to get into the PL but not all that much TV money at all...growth in costs has significantly outstripped growth in other revenues.

I think if we were in League One, say settled as an upper League One club we would break even or possibly turn a profit- we would sell key players, rely on Cup runs, combined with good revenue streams and SL is one of the more prudent on the wage front (by football standards). Or if we were a bit of a yoyo club between the two divisions, we could certainly break even if not every year then often, or over a period of time- no desire to do that though!

Suggests to me though we certainly don't know for sure, that they rose their wage bill a bit, a % but not massively- the increased amortisation also suggests a bit of extra ambition but it's not huge- dare say their owners can subsidise £3-4m losses for some while to come, question would be do they want to?

One curiosity is that their operating costs for last season as per the Bristol Rovers 1883 Ltd accounts have fallen.

For example, in these accounts last season it stated that their Operating Costs were £8,968,183...whereas this year in the Headline figures it states that they were £8,283,814 for the 2017/18 season.

@bert tann any ideas on this?

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