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The Championship FFP Thread (Merged)


Mr Popodopolous

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Have amended some of my Stoke numbers based on Swiss Ramble's allowances and one or two other bits.

image.thumb.png.d801542f995d048583238225e9dec762.pngimage.thumb.png.f656add85ce3ec9ddde8689423eef97d.png

Still working on some for 2021/22 and remember this is Stoke's Covid numbers as estimated by them, not the EFL's £5m, £5m and £2.5m.

Saw a rather big claim that their wage bill was  down to £27m but unsure if this was before tax, NI etc, inclusive of non playing staff and so on.

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8 minutes ago, Merrick's Marvels said:

What's the short version - is the news good, bad or indifferent for them? 

I wish I could give a quick and easy answer but...

It's hard to say. More challenging moving forward says Swiss Ramble- and a reason it is hard to say is that their Covid claimed losses and add-backs are massively at odds with what clubs voted on...the headroom from 2021 onwards was shrinking though so questions certainly.

Clubs voted on £5m in 2019/20, £5m in 2020/21 and £2.5m last season.

Stoke have put in £30m in Player Impairment alone in 2019/20 and £11m in addbacks from lost transfer revenue or mix of profit and savings- the other £15m looks reasonable but how can one club be allowed to do that?? The Impairment in particular is doubly helpful because not only is it a big addition and therefore writeoff in the year itself, but it removes costs from future seasons.

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On 30/06/2022 at 08:12, Davefevs said:

Mr P….thought you might like this.  Mention of T-1 and projections, albeit Premier League.

 

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564C546C-ED55-4D4F-BD6B-0CE7658FEE33.jpeg

Thanks Dave- sold on the day itself...would have thought the combined Covid season would be T-1 then and T-2 going into next season. Burnley and Leeds dropped their cases btw it would seem- Kieran Maguire reckons that the profit on Richarlison via the Esk was £32m IIRC. I am assuming that the Richarlison profit got them over the line although their £170m in Covid losses is a total joke.

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On 30/06/2022 at 12:50, billywedlock said:

If owners pay the bills , I have no issue . But with superficial FFP that allows others to receive millions in parachute payments the system is ridiculous  . It is financial unfair play and a nonsense . The Coates family would match any parachute  payment , and why are they not allowed to . The lawyers are asking the question I am sure. 

That may well be true- and is a perfectly valid regulatory position to hold, although Stoke are in no position to preach on one level...

  1. £30m in Covid "Impairment" in 2019/20 alone.
  2. £11m in Player Sale add-backs for 2020/21- indeed this bit could set a precedent as we are arguing this exact thing that as a result of Covid we can add-back lost player sale profits...no indication that the EFL have approved this method yet btw.
  3. Parachute Payments are the big factor here- but cannot have one rule for Stoke and one for the other 23- if we get penalised I trust Mr. Lansdown will be pointing the finger at Stoke, indeed he should already be onto the EFL I would say. As should other clubs- the £30m Impairment feels a nonsense, simply insist on it straight line for FFP purposes and let the chips fall where they may. As for hypothetical Player Sale add-backs, you either approve some or none.

Oh and £32m Profit on the stadium and training ground combined- I have questions about the info for the stadium deal on the Land Registry vs claimed date in the accounts, see also Sheffield Wednesday and Hillsborough- similarities albeit different. Somewhat important as the EFL regulation in q not only excludes profit on fixed assets effective from the 2021/22 season but the accounting reference period covering that season. Devil and detail.

I should add, this £30m and £11m in particular is in the context of the EFL's club voted limit on a £5m Covid allowance for 2019/20, the same for 2020/21 and £2.5m for the season just gone.

My favoured FFP related solution to Stoke's manouvres would be:

  1. If player transfer add-back profits not permitted, add the £11m back to the losses or remove them from the deductions- adding £11m in 2 seasons to the Covid period, thereby an average of £5.5m.
  2. As for the £30m in Impairment, we can a) Add back the £30m to Covid losses and account for it there and then- £15m it would be averaged, or spread it over the term of contract for each player impaired, up until expiry or disposal- no small job the latter. If that puts them in breach of FFP then charge them or offer a settlement.
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Two snippets.

  1. West Brom's accounts ie the Group accounts should be out today or tomorrow- some movement at CH. Reported a £0.1m profit in 2020/21 but without seeing the full accounts it's hard to say- £55.5m their Upper Loss Limit to 2021/22 and to 2022/23.
  2. Stoke- okay it's what I read on their forum but apparently made a £2m profit last season!? Possible I suppose but given the stadium and training ground sale saw a one off gain of £32m or so and Parachute Payments fomally ended in 2021/22 for them- ie 2020/21 was the final season of Parachute Payments- then it'd be some going. Yes Collins went for £12m IIRC and as an academy product is pure profit but that's a net swing of <£20m in gains/profit on disposal.
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Just on the WBA loan to their owner's other company. POF Podcast saying that the owner is going to repay that £5m loan by taking a matching dividend from WBA. So essentially he's borrowed money from WBA, and is then going to repay it using money that WBA is going to pay to him. If so that's absolutely appalling, regardless of legality. From my knowledge of EFL Rules (built up during discussions around Derby) there's likely not anything that can be done to stop him.

The two deals will essentially be separate, and I believe will go through a Channel Islands company as well - essentially the dividend gets declared up the company chain until it arrives at Mr Lei's account. Either way, and however it's papered, it's an atrocious way to treat a football club.

I can't stress enough how angry I'll be if when he gets away with this.

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3 hours ago, ExiledAjax said:

Just on the WBA loan to their owner's other company. POF Podcast saying that the owner is going to repay that £5m loan by taking a matching dividend from WBA. So essentially he's borrowed money from WBA, and is then going to repay it using money that WBA is going to pay to him. If so that's absolutely appalling, regardless of legality. From my knowledge of EFL Rules (built up during discussions around Derby) there's likely not anything that can be done to stop him.

The two deals will essentially be separate, and I believe will go through a Channel Islands company as well - essentially the dividend gets declared up the company chain until it arrives at Mr Lei's account. Either way, and however it's papered, it's an atrocious way to treat a football club.

I can't stress enough how angry I'll be if when he gets away with this.

Saw this and thought of you.

@Albuquirky

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22 minutes ago, Davefevs said:

Saw this and thought of you.

@Albuquirky

Yeh, from my memory of English dividends this is correct. FYI, we the uninitiated will only have access to old accounts, whereas the determination of whether there are distributable reserves will be done at the point the dividend is declared, so it is very hard for anyone outside of WBA to guess whether they do have £5m knocking around for a dividend.

POF were suggesting that Lei (or whatever company structure he owns WBA through) is not the sole shareholder. I don't have the time to dig into this one so am operating on titbits and foggy memories, but this absolutely stinks of an abuse of power by a terrible owner. I hope there are some educated WBA fans who can get together and properly call this out because at face value it's ******* disgusting.

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The new EFL regulations are out for 2022/23! I've had a quick look but in particular at the FFP/P&S ones...some changes and amendments for sure, codified now after reports in recent months.

@Davefevs @chinapig @downendcity @Hxj @Port Said Red @CyderInACan

@ExiledAjax @Coppello

Feel free to tag others I may have forgotten!

https://www.efl.com/-more/governance/efl-rules--regulations/efl-regulations/appendix-5-financial-fair-play-regulations/

Seems there is a lot more detail in respect of RPTs- although they call it APTs!

Quote

 1.1.7  Associated Party means:

  (a)  a Person who has Control of the Club or would be deemed to be interested in the Club in accordance with Regulation 105.2;

  (b)  any Associate of any Person(s) who has Control of the Club or would be deemed to be interested in the Club in accordance with Regulation 105.2; and

  (c)  any Person of which any Person(s) who has Control of the Club or would be deemed to be interested in the Club in accordance Regulation 105.2:

   (i)  is a director; and/or

   (ii)  either directly or indirectly holds shares; and/or

   (iii)  is able to influence the financial, commercial or business affairs or management or administration of that company, and

  (d)  any Person of which any Associate of any Person(s) who has Control of the Club or would be deemed to be interested in the Club:

   (i)  is a director; and/or

   (ii)  either directly or indirectly holds shares; and/or

   (iii)  is able to exercise any influence or control; and

  (e)  any Person which is a Group Undertaking, Parent Undertaking, Subsidiary Undertaking or Associated Undertaking of any Person referred to in paragraphs 1.1.7(c) and 1.1.7(d) above;

  (f)  any Person who is an Associate, shareholder, director, employee or is able to influence the financial, commercial or business affairs or the management or administration of any Person referred to in 1.1.7(c), 1.1.7(d) and 1.1.7(e) and any Associate of any such shareholder, director or employee;

  (g)  any Person who is an employee or partner or Associate of any Person referred to at paragraph 1.1.7(f) of this definition;

  (h)  any Person who has an agreement with any Person listed referred to in paragraphs 1.1.7(a)-(g) in relation to the exercise of their voting power in the Club or the holding or disposal of their interests in the Club;

  (i)  a Person who holds and/or has possession of the beneficial interest in, and/ or the ability to exercise the voting rights applicable to, shares or other securities in the Club (whether directly, indirectly, by means of holding such interests in one or more other person) or by contract or otherwise including without limitation by way of any Concert Party) which confer in aggregate on the holder(s) thereof 5 per cent or more of the total voting rights exercisable at general meetings of the Club;

  (j)  any Person who holds a loan interest or other debt or security interest of any kind in the Club or an entity in the same group of companies as the Club, with the exception of any such interest held:

   (i)  as part of regulated banking services provided by a Financial Institution;

   (ii)  in the form of bonds, notes or other securities held by professional investors; or

   (iii)  pursuant to a debenture providing the holder with access to tickets to events at the Club’s stadium;

  (k)  where a government, public or state funded body has Control of a Club, any Person who that government, public or state funded body also has Control of.

  When considering where a Person is an Associated Party, The League will direct its attention to the substance of the relationship and not merely the legal form.

 1.1.8  Associated Party Transaction means any transaction, whether directly or indirectly, between a Club and an Associated Party. In considering whether a transaction is an Associated Party Transaction, The League will direct its attention to the substance of the transaction and not merely the legal form.

Guidance

If the accounting standards applied by the Club do not require the Club to disclose Associated Party Transactions within the notes to the Annual Accounts, the transactions should be detailed in a separate schedule and submitted to The League.

More meat on the bones in respect of Covid Costs too! Some look hard to reconcile with the below.

Quote

 1.1.11  COVID-19 Costs means lost revenues and/or exceptional costs incurred by a Club that are directly attributable to the COVID-19 pandemic and that are identified and calculated in accordance with such guidance as issued by The League.

 Claims of COVID-19 Costs of up to:

  (a)  £5,000,000 in Season 2019/20;

  (b)  £5,000,000 in Season 2020/21; and

  (c)  £2,500,000 in Season 2021/22,

  shall be accepted by the League based on Club submissions alone . For any claim for COVID-19 Costs which in aggregate has an impact of more than £7,500,000 on the Club’s P&S Calculation (acknowledging the combination and averaging of Season 2019/20 and Season 2020/21) The League shall assess whether in order to be excluded from the calculation of Adjusted Earnings Before Tax, any part or all of the claim needs to be separately disclosed:

  (d)  by way of notes to the Annual Accounts; or

  (e)  by way of supplementary information which has been identified and calculated in accordance with such guidance as issued by The League and reconciles to the Annual Accounts or agreed upon procedures and which has been subject to independent audit.

Guidance

The express intention of this amendment is to introduce allowances of up to £5m in Seasons 2019/20 and 2020/21 with retrospective and/or retroactive effect in respect of results submitted in those Seasons and for any other reporting periods to which those Seasons relate.

Where a Club has claimed Covid-19 Costs which in aggregate are in excess of the £12.5m limit (averaged out to £7.5m for the purposes of the P&S calculation) The League will require a full breakdown of all Covid-19 Costs for review.

In the scenario where one single addback is material to the £12.5m limit a Club may apply to the EFL for only this element of the addback to be subject to the independent audit, providing that the remainder are otherwise in accordance with the issued COVID-19 Costs guidance and within the relevant amounts above.

Please note for P&S submissions in Season 2023/24, the COVID-19 Costs addback for Seasons 2019/20 and 2020/21 will no longer be relevant. Therefore only the COVID-19 Costs for Season 2021/22 will be included in the P&S Calculation and will be capped at £2.5m.

Intrigued by the concept of introducing those allowances with retrospective and retroactive effect...to what extent is it up to the League to accept Covid-19 Costs?

Quote

 1.1.16  Player Registration Schedule means a: table (in such a format which shall be agreed by The League with each Club from time to time) which provides such information which is required to be disclosed in accordance with Annex 2 of this Appendix 5.

Reinforces straight line amortisation- how for example might it affect Stoke and the £30m Impairment! Not a problem with the Impairment but trying to class it as a Covid-19 Cost.

Quote

2.9  Where The League determines, in its reasonable opinion and having considered the Future Financial Information provided by the Club in accordance with Rule 2.7, that the Club is forecasting to breach the Upper Loss Threshold in T+1 and/or T+2 then The League shall have the powers set out in Regulation 16.20.

Guidance

In the event that a Club, based on the information provided by the Club to The League, is forecasting to exceed the Upper Loss Threshold in T+1 and/or T+2, The League will consider whether it is necessary to require the Club to operate in accordance with the terms of a business plan (to include, by way of example, requirements relating to player acquisitions, disposals, reduction in player costs (i.e. wages) and, where the Club thinks it is achievable, uplifts in revenue) in order to bring the Club back into compliance with Upper Loss Threshold for T+1 and/or T+2.

The League recognises that T+2 is so far in the future it would be difficult for Clubs and The League to accurately forecast for the purpose of P&S and the potential exercise of these powers needs to be considered in that context.

General Approach

The purpose of this Rule is to give Clubs and The League the opportunity to work together to develop the terms of a business plan which will include remedial measures to allow the Club to bring itself back into compliance with these Rules.

The following paragraphs detail The League’s general approach in respect of forecasted breaches in T+1 and/or T+2.

Forecasting Breaches in T+1

Where a Club is forecasting a non-material breach only occurring in T+2, The League’s general approach will usually be to request further information in order to gain comfort that the Club has the necessary plans in place to work towards compliance. The League, generally, in these circumstances will not seek to utilise the more restrictive powers afforded to it unless a change in circumstances deems this necessary. The League will then reassess the Club’s position in T+1 based on the updated results posted as part of the usual March submission process.

If a Club is forecasting a material breach occurring in T+2, The League’s general approach would be to require the Club to provide a significantly more detailed plan than would be the case if the forecasted breach was not material. The League would likely treat such instances in the similar manner it would for a forecasted breach in T+1. Again, The League will then reassess the Club’s position in T+1 based on the updated results posted as part of the usual March submission process.

Clubs will note that this guidance sets out The League’s general approach and that The League will need to determine each set circumstances based on the merits whilst also ensuring that all Clubs are treated consistently. This may lead to The League diverging from its general approach where it is appropriate to do so and nothing in this guidance will affect The League’s right to do so.

This is a real game-changer- we touched upon it in February, but Forecasting of future breaches and the EFL getting involved ahead of time. I still maintain it gives the League more scope for an instant deduction if required.

Quote

2.10  If the P&S Calculation results in a loss that exceeds the Upper Loss Threshold (calculated in accordance with Rule 3) then:

 2.10.1  the Club shall be subject to a Player registration embargo such that The League shall have the right to refuse any application made by that Club to register any Player or any new contract of an existing Player with that Club; and

 2.10.2  the League may exercise its powers set out in Regulation 16.20; and

 2.10.3 the Club shall be treated as being in breach of these Rules and accordingly The League shall refer the breach to the CFRP in accordance with Appendix 6 of the Regulations.

CRFP gets its first proper mention, and the automatic embargo for a projected breach in March now set in stone.

Pulled out some of the key changes- maybe some I've missed but I feel these are quite important.

Edited by Mr Popodopolous
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Thanks @Mr Popodopolousfir putting in the effort, will read fully myself in time.

For me, the biggie was the bit re Covid:

23382332-D3A9-485A-8833-0F9CB7655A9A.thumb.jpeg.4cfb55c7746af9bef63cd0f3c5cf021a.jpeg
 

As I suggested (although no means was I certain), the £7.5m was the club not having to evidence, and anything over this has to be evidenced and covered in accounts.  The retrospective / retroactive bit is good to see.  Clubs like Forest added notes to their 20/21 accounts re 21/22 “losses”, whereas we put nothing.  They were covering their arses, but I worried that as we hadn’t put anything, might be have missed the boat.  The new rules allow us to submit in our reporting alone, not having to put into accounts per se.

So, now, more than ever I’m confident Richard Gould will have agreed with the EFL what we are “excluding” for Covid and it will be more than the £7.5m…and we will therefore be inside FFP / P&S for this period (ending 22/23).  As you know our position strengthens from 23/24 onwards, so we are in a safe place as far as I’m concerned.

IKm sure other clubs like Stoke will be “fudge” through more exclusions than us, and there will be some clubs who’ve put through less than us.  They really were extraordinary times, but I’d also blame clubs like us for allowing us to get into a situation where Covid completely screwed our financial planning.

Guess my FFP Covid exclusion estimates aren’t really worth the cells in excel they are now typed into…but I will keep them going until 21/22 drops out…I’m a patient man ???

1 hour ago, Mr Popodopolous said:

Interested as well to note, having had another look again the distinction between material and non-material breaches in terms of future forecasting...how big is a material breach in this context do we think?

Yes, definitely something to look into and get our heads around.

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15 hours ago, Davefevs said:

Thanks @Mr Popodopolousfir putting in the effort, will read fully myself in time.

For me, the biggie was the bit re Covid:

23382332-D3A9-485A-8833-0F9CB7655A9A.thumb.jpeg.4cfb55c7746af9bef63cd0f3c5cf021a.jpeg
 

As I suggested (although no means was I certain), the £7.5m was the club not having to evidence, and anything over this has to be evidenced and covered in accounts.  The retrospective / retroactive bit is good to see.  Clubs like Forest added notes to their 20/21 accounts re 21/22 “losses”, whereas we put nothing.  They were covering their arses, but I worried that as we hadn’t put anything, might be have missed the boat.  The new rules allow us to submit in our reporting alone, not having to put into accounts per se.

So, now, more than ever I’m confident Richard Gould will have agreed with the EFL what we are “excluding” for Covid and it will be more than the £7.5m…and we will therefore be inside FFP / P&S for this period (ending 22/23).  As you know our position strengthens from 23/24 onwards, so we are in a safe place as far as I’m concerned.

IKm sure other clubs like Stoke will be “fudge” through more exclusions than us, and there will be some clubs who’ve put through less than us.  They really were extraordinary times, but I’d also blame clubs like us for allowing us to get into a situation where Covid completely screwed our financial planning.

Guess my FFP Covid exclusion estimates aren’t really worth the cells in excel they are now typed into…but I will keep them going until 21/22 drops out…I’m a patient man ???

Yes, definitely something to look into and get our heads around.

Cheers Dave- look forward to your analysis too.

Yes- agree on Covid being a big thing. That's a better way of looking at it than me- could it also apply to claims deemed excessive- e.g. Stoke? ie Retrospectively/retroactively pushing back against £30m in Covid Impairment e.g. I don't quite buy still the idea of Covid Impairment or transfer add-backs for P&S purposes. That is good though, in our reporting- indeed a Telegraph article in March/April suggested that all clubs had put in revised numbers to the EFL.

Agreed.

My quick and easy revised Covid estimates then would be quite simply- the hit in revenue in the two seasons and £2.5m last season...question is would this be net of cost savings ie putting on games or...? Likely would leave us right close to the £39m to 2022/23 but not exceeding, maybe a bit lower- or maybe just I dunno £1-1.5m over something like that but nothing that can't be easily resolved.

It is.

FWIW my view and only my view on the correct categories:

  • Gate Receipts
  • Season ticket lost revenue/cost of refund
  • Matchday revenue
  • Matchday hospitality losses
  • Corporate Revenue- ie all non matchday revenue on the footprint of the stadium.
  • Costs associated with Covid-19 Protocols- ie testing, PPE, hand sanitiser and so on. Goes for the training ground and other facilities a club use as well as the ground and matchday itself.
  • Losses or rebates in TV Revenue- especially applicable to PL or Parachute clubs.
  • Cost or foregone savings associated with non utilisation of furlough scheme- some clubs did this, especially in 2019/20.

Sure there are some I have missed but that covers a range of issues I'd say.

Still have a serious problem with hypothetical player loss add-backs or indeed seeking to write off £30m in Player Impairment as a Covid Cost- that latter one sticks out like a sore thumb!

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Here's a question for people in the know or would care to comment; I believe Stoke have some FFP issues to deal with. Its no secret that they've been trying to offload Afobe and his wages whilst under contract. So managing to do another deal with Millwall I guess to take his wages off the books only to go out and sign Dwight Gale presumably on bigger wages. How is that at all possible????

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On 22/07/2022 at 19:58, Mr Popodopolous said:

The new EFL regulations are out for 2022/23!

Thanks @Mr Popodopolous lots of significant changes and lots of more subtle ones.  I do get the impression that the changes are all in the right direction particularly with the new internal oversight and dispute panel.

As regards the 'material' and 'immaterial' issue my view is that an overspend resulting in a 1-3 point deduction is immaterial in the context of the FFP deductions.

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8 hours ago, Swede said:

Here's a question for people in the know or would care to comment; I believe Stoke have some FFP issues to deal with. Its no secret that they've been trying to offload Afobe and his wages whilst under contract. So managing to do another deal with Millwall I guess to take his wages off the books only to go out and sign Dwight Gale presumably on bigger wages. How is that at all possible????

Stoke just signed Gayle and O’Shea so can’t be struggling too much with FFP

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49 minutes ago, WarksRobin said:

Stoke just signed Gayle and O’Shea so can’t be struggling too much with FFP

Well they "think" they aren't but from memory their claims for COVID comp are way out of kilter with the figures in that EFL document. They might be one of the first in front of the dispute panel.

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1 hour ago, WarksRobin said:

Stoke just signed Gayle and O’Shea so can’t be struggling too much with FFP

Definition of "can't be struggling too much with ffp" = Frank Lampard's Derby County chasing promotion !

 

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19 hours ago, Mr Popodopolous said:

Cheers Dave- look forward to your analysis too.

Yes- agree on Covid being a big thing. That's a better way of looking at it than me- could it also apply to claims deemed excessive- e.g. Stoke? ie Retrospectively/retroactively pushing back against £30m in Covid Impairment e.g. I don't quite buy still the idea of Covid Impairment or transfer add-backs for P&S purposes. That is good though, in our reporting- indeed a Telegraph article in March/April suggested that all clubs had put in revised numbers to the EFL.

Agreed.

My quick and easy revised Covid estimates then would be quite simply- the hit in revenue in the two seasons and £2.5m last season...question is would this be net of cost savings ie putting on games or...? Likely would leave us right close to the £39m to 2022/23 but not exceeding, maybe a bit lower- or maybe just I dunno £1-1.5m over something like that but nothing that can't be easily resolved.

It is.

FWIW my view and only my view on the correct categories:

  • Gate Receipts
  • Season ticket lost revenue/cost of refund
  • Matchday revenue
  • Matchday hospitality losses
  • Corporate Revenue- ie all non matchday revenue on the footprint of the stadium.
  • Costs associated with Covid-19 Protocols- ie testing, PPE, hand sanitiser and so on. Goes for the training ground and other facilities a club use as well as the ground and matchday itself.
  • Losses or rebates in TV Revenue- especially applicable to PL or Parachute clubs.
  • Cost or foregone savings associated with non utilisation of furlough scheme- some clubs did this, especially in 2019/20.

Sure there are some I have missed but that covers a range of issues I'd say.

Still have a serious problem with hypothetical player loss add-backs or indeed seeking to write off £30m in Player Impairment as a Covid Cost- that latter one sticks out like a sore thumb!

Thanks for putting in the work.

Have skim read and for me you're onto the right track. Key phrase is "directly attributable". Indirect losses won't be accounted for under covid.

 

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5 hours ago, WarksRobin said:

Stoke just signed Gayle and O’Shea so can’t be struggling too much with FFP

 

4 hours ago, Port Said Red said:

Well they "think" they aren't but from memory their claims for COVID comp are way out of kilter with the figures in that EFL document. They might be one of the first in front of the dispute panel.

£56m or thereabouts in 2019/20 and 2020/21 alone!

Put another way, they listed revenue losses net of cost savings- fine- but the big bone of contention for me is the player impairment and the whole adding back for transfers that would have happened if not for Covid.

PS- they are also linked with Mawson (free) and signed Smallbone (loan) from Southampton.

image.png.da08feef5cf39cd6b3dbc86657657825.png

As we can see...£56.903m but of that, £41,47m.

Which would you say are directly attributable vs indirect losses @ExiledAjax ? I'd say the Lost revenues and costs net of savings are the former, whereas the Impairment and Net impact of lost disposals caused by Covid are indirect. Obviously Stoke are arguing that all of it is directly attributable but I just am unsure I agree, especially in a P&S context.

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3 hours ago, Mr Popodopolous said:

Which would you say are directly attributable vs indirect losses @ExiledAjax ? I'd say the Lost revenues and costs net of savings are the former, whereas the Impairment and Net impact of lost disposals caused by Covid are indirect. Obviously Stoke are arguing that all of it is directly attributable but I just am unsure I agree, especially in a P&S context.

Not my area of expertise so I stand to be corrected should "direct" or "indirect" have different interpretations in the world of accounting.

However, generally it's a pretty common sense interpretation that should be applied here. Yes lost gate receipts are obviously a direct item (although imo that should be mitigated and offset by any rise in streaming revenue). 

I'd agree that on the face of it lost impairment and projected lost transfer revenue is indirect. Those (projected and presumed) revenues rescue due to a flattening of the market caused by COVID. It's indirect because there's a step in-between COVID and the impact on the Club.

So I think, as we discussed at the time, that Stoke's gambit should fail.

 

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28 minutes ago, ExiledAjax said:

Not my area of expertise so I stand to be corrected should "direct" or "indirect" have different interpretations in the world of accounting.

However, generally it's a pretty common sense interpretation that should be applied here. Yes lost gate receipts are obviously a direct item (although imo that should be mitigated and offset by any rise in streaming revenue). 

I'd agree that on the face of it lost impairment and projected lost transfer revenue is indirect. Those (projected and presumed) revenues rescue due to a flattening of the market caused by COVID. It's indirect because there's a step in-between COVID and the impact on the Club.

So I think, as we discussed at the time, that Stoke's gambit should fail.

 

At one point Richard Gould claimed we had lost £30m in transfer income. Absolute nonsense imo but I wonder if we nevertheless tried that on with the EFL?

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42 minutes ago, chinapig said:

At one point Richard Gould claimed we had lost £30m in transfer income. Absolute nonsense imo but I wonder if we nevertheless tried that on with the EFL?

Someone will correct me if wrong but IMO that was "claimed" only in an interview or news piece. Suspect he floated it with the EFL, and based on their response and advice from the accountants it didn't become part of our final accounts - as it is with Stoke.

Said article:

https://www.google.com/amp/s/www.bristolpost.co.uk/sport/football/bristol-city-ceo-sends-message-6477092.amp

I agree it's bollocks as well.

Edited by ExiledAjax
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On 24/07/2022 at 16:35, ExiledAjax said:

Someone will correct me if wrong but IMO that was "claimed" only in an interview or news piece. Suspect he floated it with the EFL, and based on their response and advice from the accountants it didn't become part of our final accounts - as it is with Stoke.

Said article:

https://www.google.com/amp/s/www.bristolpost.co.uk/sport/football/bristol-city-ceo-sends-message-6477092.amp

I agree it's bollocks as well.

Do agree with your posts and @chinapig for that matter- only bit I would say is that it seemed unclear last time it was reported on...

In January the idea floated.

In March it was implied that the EFL were considering it, on the same day that Nottingham Forest posted large losses but had a chunk of their Covid losses attributed to this.

https://www.bristolpost.co.uk/sport/football/exclusive-bristol-citys-ffp-reform-6753159

In June it was implied that the transfer add-back rule was still undecided but not yet agreed.

Quote

The EFL are also yet to confirm if transfer “add-backs” will be permitted in submissions with City’s argument being that Covid-19 and playing a season behind closed doors led to the collapse of the transfer market outside of the Premier League, therefore their business model of leaning towards transfer revenue was adversely affected from 2020 onwards. The league has already allowed such add-backs for lost ticket revenue of £5m and £2.5m but transfer income is a more subjective figure to calculate.

https://www.bristolpost.co.uk/sport/football/bristol-city-points-deduction-finance-7219960

Certainly not hanging my hat on it but time will tell...I think for the rule utilised by anyone, well the rule itself is fairly bogus IMO.

Edited by Mr Popodopolous
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