Derby County

[Davefevs]

39 minutes ago, AnotherDerbyFan said:

It doesn't matter if Covid affected other clubs or not and by how much. All that would matter is if without Covid the club wouldn't have entered administration.

See my above comment.

I guess there would be a counter-argument....what did MM do to mitigate Covid?  Should he have signed Joswiak, te Wierik, Kazim-Richards, Marshall, Byrne, Ibe and Clarke (loan) in such a Covid-landscape?

Other clubs cut back last summer (most didn't admittedly).

[chinapig]

40 minutes ago, AnotherDerbyFan said:

It doesn't matter if Covid affected other clubs or not and by how much. All that would matter is if without Covid the club wouldn't have entered administration.

Special pleading as I say and ignoring the costs side. Could be expressed as "we would have got away with years of financial mismanagement and cheating if it wasn't for Covid."

Will be interesting to see if the administrators choose to carry on with Morris' delaying tactics, though I doubt potential buyers would welcome more uncertainty.

[Davefevs]

@AnotherDerbyFan out of interest, what did Derby do re season tickets last season?

[AnotherDerbyFan]

19 minutes ago, Davefevs said:

I guess there would be a counter-argument....what did MM do to mitigate Covid?  Should he have signed Joswiak, te Wierik, Kazim-Richards, Marshall, Byrne, Ibe and Clarke (loan) in such a Covid-landscape?

Other clubs cut back last summer (most didn't admittedly).

That's a good point. You could also add why we rejected multi-million pound offers for the likes of Lawrence and Buchanan just days before Mel started discussing administration.

A counter-counter-argument could be that no-one knew how long fans wouldn't be allowed in the stadium.

Too many complexities in it for me to think there's a realistic chance of getting the deduction overturned.

[AnotherDerbyFan]

8 minutes ago, Davefevs said:

@AnotherDerbyFan out of interest, what did Derby do re season tickets last season?

We were given 5 options for 19/20:

1. Pro-rata refund (I think it took until the start of this season for the remaining people to get it)
2. 20% discount on 20/21 ST
3. 10% discount on 20/21 ST with free RamsTV subscription for the remainder of the season
4. 4 match ticket vouchers for 20/21
5. No refund

For 20/21:

1. The above options to be carried over to 21/22
2. Option to get full refund on 20/21 ST, but had to request it before a certain match day
3. Pro-rata refund if keep 20/21 ST

Probably some other options, but can't remember off the top of my head

[BTRFTG]

2 hours ago, AnotherDerbyFan said:

A club's revenue isn't volitile... it's not going to go from £30m to £10m, then up to £40m in successive seasons in the Championship

But that's exactly what you are suggesting, that revenues were severely hit by Covid. I know Derby think themselves an exception and love so to do but you can't have it both ways. Whilst TV & EFL fundings are less volatile, as Covid demonstrates ticket & commercial income may be. The point of accounts being to be able to see what you've banked and when? Who knows whether Derby front loaded commercial arrangements to suit in any given period without them being reported? Rangers did it for years, banking 'income' (sic) from deals secured against future revenues.

Why would commercial and match revenues be zero in 20/21? Didn't you play, didn't you sell online subscriptions to punters, did all your commercial punters pull out? That's not what 32Red's accounts are likely to say or what their commercial director has spoke of this week re Rooney.

I think had you published your accounts when you were required so to do you would have been found to have contravened FFP, been deducted points, faced sanctions and wouldn't have benefitted from the prize money you did. Maybe that would have put you under? All conjecture as we won't know until, like all other clubs are required to, you publish your accounts, in full, non-impaired.

Edited September 24, 2021 by BTRFTG

[AnotherDerbyFan]

6 minutes ago, BTRFTG said:

But that's exactly what you are suggesting, that revenues were severely hit by Covid. I know Derby think themselves an exception and love so to do but you can't have it both ways. Whilst TV & EFL fundings are less volatile, as Covid demonstrates ticket & commercial income may be. The point of accounts being to be able to see what you've banked and when? Who knows whether Derby front loaded commercial arrangements to suit in any given period without them being reported? Rangers did it for years, banking 'income' (sic) from deals secured against future revenues.

Why would commercial and match revenues be zero in 20/21? Didn't you play, didn't you sell online subscriptions to punters,

That falls under "TV, broadcasting revenue and football league income"

6 minutes ago, BTRFTG said:

did all your commercial punters pull out? That's not what 32Red's accounts are likely to say or what their commercial director has spoke of this week re Rooney.

That falls under "sponsorship"

6 minutes ago, BTRFTG said:

I think had you published your accounts when you were required so to do you would have been found to have contravened FFP, been deducted points, faced sanctions and wouldn't have benefitted from the prize money you did. Maybe that would have put you under? All conjecture as we won't know until, like all other clubs are required to, you publish your accounts, in full, non-impaired.

If we had published accounts when we were required, they would have likely shown we were still within the limits due to the amortisation policy.

[Monkeh]

3 hours ago, AnotherDerbyFan said:

Why do you think that, when the administrators are confident of new ownership before January?

I don't see the relevance of not submitting the accounts (a result of the EFL's investigation into the amortisation and stadium issues). Administration was brought upon us because of a lack of cash flow. A 50% drop in income over 16 months or so obviously plays a massive part in that, especially if without Covid we could have got through to a point where we'd be sustainable (break-even or better).

The EFL regs state:

Club income: In the event that a club suffers material adverse effects upon the loss of anticipated income streams which mean that it is unable to meet its liabilities as and when they fall due. This could only be grounds for appeal, however, if the loss occurs during the currency of a binding agreement (i.e. not upon expiry).

A £20m loss of income due to Coivid would match that description in my opinion.

As I said, a successful appeal based on force majeure is hopeful thinking, but I wouldn't rule it out as a possibility at this stage.

Because Bolton, Portsmouth and countless others were as cocky as you are

[Mr Popodopolous]

Small point on the amortisation bit, don't have time to scroll through all the posts so apologies if already covered.

It all has to be accounted for eventually. Chances are that with Derby's methods, a breach could have materialised somewhere down the line. 

I remember figures posted by @AnotherDerbyFan months ago that showed amortisation over a lot of seasons using different methods.

Assuming that every penny of fee was correctly accounted for either through amortisation or impairment- of fees not goodwill- then it would've caught up with the club at some point, in a P&S context.

Edited September 24, 2021 by Mr Popodopolous

[Monkeh]

44 minutes ago, AnotherDerbyFan said:

That's a good point. You could also add why we rejected multi-million pound offers for the likes of Lawrence and Buchanan just days before Mel started discussing administration.

A counter-counter-argument could be that no-one knew how long fans wouldn't be allowed in the stadium.

Too many complexities in it for me to think there's a realistic chance of getting the deduction overturned.

Then your club deserves absolutely everything you get,

You could of sold those and not enter administration 

But then reading your post and clutching at straws I doubt you have the brain power to understand this

[Mr Popodopolous]

1 minute ago, Monkeh said:

Then your club deserves absolutely everything you get,

You could of sold those and not enter administration 

But then reading your post and clutching at straws I doubt you have the brain power to understand this

Surely selling those would have just papered over the cracks though? Really Mel Morris is reportedly worth £500m so there was no need for administration at all from that angle anyway.

[AnotherDerbyFan]

3 minutes ago, Mr Popodopolous said:

Small point on the amortisation bit, don't have time to scroll through all the posts so apologies if already covered.

It all has to be accounted for eventually. Chances are that with Derby's methods, a breach could have materialised somewhere down the line. 

I remember figures posted by @AnotherDerbyFan months ago that showed amortisation over a lot of seasons using different methods.

Assuming that every penny of fee was correctly accounted for either through amortisation or impairment- of fees not goodwill- then it would've caught up with the club at some point, in a P&S context.

Possibly, it depends how it was spread out.

Method 1: £5m underspend, £5m underspend, £5m underspend = compliant in 3 periods
Method 2: £5m overspend, £10m underspend, £10m underspend = compliant in 2 periods

In all honesty, you probably would have seen us hit with much bigger points deductions if you had let us stick to 'The Derby Method'.

[BTRFTG]

18 minutes ago, AnotherDerbyFan said:

That falls under "TV, broadcasting revenue and football league income"

That falls under "sponsorship"

If we had published accounts when we were required, they would have likely shown we were still within the limits due to the amortisation policy.

On the match purchase TV income: it'll be interesting to see how clubs account for it but it wasn't any part of existing deal, not Sky, nor EFL. Clubs were allowed to sell via their own arrangements and keep revenues, hence would have replaced to some degree matchday income.

Sponsoring is invariably rolled up as Commercial Activity (for that is what it is,) but with Derby who knows? So one assumes there was no perimeter advertising at Pride Park last year, no use of trademark or copyright for intellectual property, that Derby laid off/furloughed all its commercial department? Bet it didn't.

As for remaining within FFP limits, even your beloved Chairman has now conceded you haven't done that despite attempting, using the most contrived practice, to pretend you had.

The quicker Derby fess up, show the numbers and take their punishment, the better for them as their protracted pleadings are making the average fan, who couldn't normally give a flying about them, begin to wish their existence is short lived, better for the benefit of the game.

[AnotherDerbyFan]

6 minutes ago, Monkeh said:

Then your club deserves absolutely everything you get,

You could of sold those and not enter administration 

But then reading your post and clutching at straws I doubt you have the brain power to understand this

Like I said, not selling those players will be a contributing factor as to why it'd very unlikely we'll had the admin points deduction removed. Would selling the players we received offers for have been enough to get us through to a point of being self-sufficient? We'd have needed to raise £20m from sales for it to outweigh the Covid impact.

PS. I'm sure you can think of better insults than that. 0/10 for creativity, 1/10 for effort.

[AnotherDerbyFan]

3 minutes ago, BTRFTG said:

On the match purchase TV income: it'll be interesting to see how clubs account for it but it wasn't any part of existing deal, not Sky, nor EFL. Clubs were allowed to sell via their own arrangements and keep revenues, hence would have replaced to some degree matchday income.

RamsTV income could potetnially fall under match ticket income, but the much more likely option is for it to be grouped with TV income.

3 minutes ago, BTRFTG said:

Sponsoring is invariably rolled up as Commercial Activity (for that is what it is,) but with Derby who knows? So one assumes there was no perimeter advertising at Pride Park last year, no use of trademark or copyright for intellectual property, that Derby laid off/furloughed all its commercial department? Bet it didn't.

Sponsorship is separate from commercial.

3 minutes ago, BTRFTG said:

As for remaining within FFP limits, even your beloved Chairman has now conceded you haven't done that despite attempting, using the most contrived practice, to pretend you had.

The quicker Derby fess up, show the numbers and take their punishment, the better for them as their protracted pleadings are making the average fan, who couldn't normally give a flying about them, begin to wish their existence is short lived, better for the benefit of the game.

I gave a very vague comment, which could relate to 'new Derby method' or a 'standard method'.

[Davefevs]

@AnotherDerbyFan

What is your view on whether Derby pay Rooney alone or whether it is a combo of Derby and Red32.  I guess (split made up) if Rooney is on £90k p.w. and Derby pay £20k / Red32 £70k, I'm guessing Red32 aren't gonna be required to pay £3.5m to Derby in Sponsorship???  Just my simple concept.

[chinapig]

2 minutes ago, AnotherDerbyFan said:

PS. I'm sure you can think of better insults than that. 0/10 for creativity, 1/10 for effort.

I agree that was unjustified. But there is such a thing as motivated reasoning, a trap you may be falling into as we all do from time to time.

Motivated reasoning is a phenomenon studied in cognitive science and social psychology that uses emotionally biased reasoning to produce justifications or make decisions that are most desired rather than those that accurately reflect the evidence.

[Mr Popodopolous]

16 minutes ago, AnotherDerbyFan said:

Possibly, it depends how it was spread out.

Method 1: £5m underspend, £5m underspend, £5m underspend = compliant in 3 periods
Method 2: £5m overspend, £10m underspend, £10m underspend = compliant in 2 periods

In all honesty, you probably would have seen us hit with much bigger points deductions if you had let us stick to 'The Derby Method'.

I'd have to look in more depth when I get time but I'll take what you've said there and agree. I think I get it but I do recall the EFL Written Reasons stated an amortisation spike from IIRC £4.6m to £20m between 2018/19 and 2019/20? I know wages would've dropped too.

Yeah seems quite possible for sure. I remember Ghost of Clough suggested that DCFC would have had using Derby's method this season or season just gone to sell players just to remain within limits, that's before any strengthening etc.

Edited September 24, 2021 by Mr Popodopolous

[AnotherDerbyFan]

1 minute ago, Davefevs said:

@AnotherDerbyFan

What is your view on whether Derby pay Rooney alone or whether it is a combo of Derby and Red32.  I guess (split made up) if Rooney is on £90k p.w. and Derby pay £20k / Red32 £70k, I'm guessing Red32 aren't gonna be required to pay £3.5m to Derby in Sponsorship???  Just my simple concept.

It'll be entirely Derby, with increased sponsorship. Hopefully only a few months until we finally see some accounts to give us a clue on how much extra 32Red are giving us

[BTRFTG]

13 minutes ago, AnotherDerbyFan said:

RamsTV income could potetnially fall under match ticket income, but the much more likely option is for it to be grouped with TV income.

Sponsorship is separate from commercial.

I gave a very vague comment, which could relate to 'new Derby method' or a 'standard method'.

As was reported the last time you published accounts but at the risk of sounding like a broken record, who knows what you've done since?

Recall the amortization policy you claim likely kept you within FFP limits was, er, changed from flatline to something that allowed you to dodge a bullet. 

The list of Commercial Activities broken down is just that. Merchandising, flogging programmes or shirts , like selling Sponsorship, is a Commercial activity.

[Ska Junkie]

4 hours ago, Davefevs said:

I don’t see how you can expect anything less than a 12 point deduction for Administration.  Them be the rules, there is no sliding scale.  I don’t see how you’ll get away with the points deduction for the other EFL charges, whether that be 9 (plus 3 Suspended) or another amount of points. Morris already admitted to a breach of FFP in 2018.  He didn’t elaborate whether that was one cycle breach, or multiple cycle breaches.

With Covid, there is already a process to submit losses and allow these to be allowable exclusions for FFP.

In all honesty and with all resect to @AnotherDerbyFan, I can see why they would appeal but every other club was dealt the same deck with covid etc so why should DCFC be treated any differently to the rest of us? We've cut our cloth accordingly, as have many others, and survived, although with massive wage bill cuts, why should DCFC avoid the same protocols?

No disrespect to our DCFC visitors but I can't see why they should wriggle out of this as they have clearly used every possible trick in the book to spend beyond their means in pursuit of a dream (as we have to an extent I suppose) and now they are paying the price.

[Mr Popodopolous]

One more general point that takes individual clubs out of the equation for a minute.

Any club that has a negative cash flow is vulnerable to this kinda thing. Whether it's an owner going bust, having their debts called in, giving up, health issues, costly divorce. The specific issue doesn't really matter.

Then it depends on how much cash that club has in the bank so to speak, but any club that has to have cash losses topped up by an owner or entity (Fosun at Wolves maybe an example of an entity) is vulnerable, there are loads of circumstances beyond that which show the future path but there is a starting point.

Someone like Burnley have a very good cash balance so I'd expect them to be fine for some time but they really aren't the norm. Man Utd obviously, Arsenal did, dunno if they still do. Dunno about regular Championship? Do any? 

[Ska Junkie]

3 minutes ago, Mr Popodopolous said:

One more general point that takes individual clubs out of the equation for a minute.

Any club that has a negative cash flow is vulnerable to this kinda thing. Whether it's an owner going bust, having their debts called in, giving up, health issues, costly divorce. The specific issue doesn't really matter.

Then it depends on how much cash that club has in the bank so to speak, but any club that has to have cash losses topped up by an owner or entity (Fosun at Wolves maybe an example of an entity) is vulnerable, there are loads of circumstances beyond that which show the future path but there is a starting point.

Someone like Burnley have a very good cash balance so I'd expect them to be fine for some time but they really aren't the norm. Man Utd obviously, Arsenal did, dunno if they still do. Dunno about regular Championship? Do any? 

Weren't Reading at 226% of income on wages very recently? @Davefevswould know more. I think we were over 100% as well. I would imagine many Championship clubs are TBH.

[Hxj]

5 hours ago, AnotherDerbyFan said:

When are you buying your first Derby shirt? 

I could call in on my way home - about a 15 minute diversion 

[Hxj]

On the vexed issue of Force Majeure and any appeal on the -12 points:

Derby will have to:

1. Within 7 days of receipt of the formal notice - appeal and provide all the documents they intend to rely on.

2. Pay the EFL £5,000.

3. Agree and pay for an independent accountant's report that will review the circumstances before and leading up to the Administration and report on the causes of the Administration.

4. Prove on a balance of probabilities that that there was a single event causing the Administration.

If for instance the club still hasn't been paid for the ground they are stuffed before the process starts.

[supercidered]

2 minutes ago, Hxj said:

On the vexed issue of Force Majeure and any appeal on the -12 points:

Derby will have to:

1. Within 7 days of receipt of the formal notice - appeal and provide all the documents they intend to rely on.

2. Pay the EFL £5,000.

3. Agree and pay for an independent accountant's report that will review the circumstances before and leading up to the Administration and report on the causes of the Administration.

4. Prove on a balance of probabilities that that there was a single event causing the Administration.

If for instance the club still hasn't been paid for the ground they are stuffed before the process starts.

So they are f@cked then. Good.

[BTRFTG]

5 minutes ago, Hxj said:

If for instance the club still hasn't been paid for the ground they are stuffed before the process starts

I'd assumed Gellaw's accounts reflected that they'd purchased the asset but had creditors within the year in a similar sum who I assumed to be loan repayments (i.e. a short-term mortgage flip.)

Are you suggesting in reality they've claimed ownership but haven't yet paid for it? I've done plenty of property deals in my time but never one where a freehold was transferred on the basis of a future payment commitment. Legally, how the hell might that be structured?

[Hxj]

4 minutes ago, BTRFTG said:

Legally, how the hell might that be structured?

The land is transferred in the usual way and the consideration is left outstanding on a loan account.

[BTRFTG]

6 minutes ago, Hxj said:

The land is transferred in the usual way and the consideration is left outstanding on a loan account.

Well my,  I've never encountered a freeholder who'd be interested in that type of deal and if that's really how they contrived to move the FFP numbers they should have the full version of the OED thrown at them.

[Davefevs]

7 minutes ago, BTRFTG said:

Well my,  I've never encountered a freeholder who'd be interested in that type of deal and if that's really how they contrived to move the FFP numbers they should have the full version of the OED thrown at them.

I can hear MM repeating the words - I'm not an Accountant, just like in the various interviews we've heard. 

In true Monty Python, he's just a very naughty boy.