Hxj

5 hours ago, Mr Popodopolous said:

I'm actually genuinely surprised at the number who seem to back the Club/Mel Morris

That's because you spend far too much time on this board and the general hatred for Steve Lansdown for not putting enough of his money in to a club that he his hated for owning!

2 hours ago, Mr Popodopolous said:

A bit of confusion stems here from the fact that Venkys London Limited is listed as the parent, but its accounts only run to 31st March, whereas Blackburn Rovers company runs to the more conventional 30th June. Which one is used for P&S and how are the two dates reconciled, only the Club and EFL know for sure.

If Venkys is the TopCo for FFP purposes then group accounts have to be prepared for the year ending on a date in the period from 31 May to 31 July - see reg 1.1.3 penultimate paragraph:

"If the accounting reference date falls at any other time, separate accounts for the Club or the Group as appropriate must be prepared for a period of twelve months ending on a date between 31 May and 31 July inclusive, and in such a case “Annual Accounts” means those accounts."

1 hour ago, Mr Popodopolous said:

Some Derby fans are also making two interesting pointless arguments.

That reads better!

Firstly the problem with the amortisation method used was, quoting the actual decision at para 108.a, that

" ... it was impermissible in amortising under the cost model in relation to the accounts for 2015/16, 2016/17 and
2017/18 for the Club to take into account possible resale values of players."

So using a different method with resale values is still impermissible.  Using some sort of flexible amortisation is possible, but that would need extensive documentation to demonstrate and we already know that that does not exist.   As far as I can see it is a simple straight line, nothing else is possible.

There really is not enough good data out there to determine if Derby failed or passed FFP.

If Leeds had failed FFP then they would have had to have taken the punishment, but there is no evidence that they did, I am sure that they actually passed it.  Failing is cheating, not failing is not cheating.

2 hours ago, Mr Popodopolous said:

I also wonder about Fulham.

Also one living on the edge, but I suspect that a good dose of averaging, Parachutes and judicious covid related amortisation will see them through.

16 minutes ago, Davefevs said:

Venkys just put £29m in (guess this is covering off losses / turning into shares?)

Probably just a vain end of year attempt to make the balance sheet look a little better.  They haven't put any share capital in for a good few years, so I suspect that the EFL were also getting twitchy.

7 hours ago, havanatopia said:

So who's up next? 

Reading, Stoke, Blackburn all looking dodgy, plus some others.

Difficult to see how it will all play out this season with the Covid exemptions and averaging.  There will be some interesting arguments behind closed doors as to what is acceptable as a deduction.

33 minutes ago, Lanterne Rouge said:

If you take out the `Rooney as manager` bit it reads just like Sheffield Wednesday last season

One day clubs will learn .....

18 hours ago, Mr Popodopolous said:

Afternoon @Hxj- what's the feasibility of this in your view, could the EFL suspend Derby's fixtures or is it up to the Clubs in q?

I am sure the EFL have the right to do so; but I doubt it will happen.  It just gets too complicated too quickly.

Personally I think that the slow death dance of DCFC will become a lesson in corporate greed.  How a once great club went all out and failed.  If the EFL are true to their word then DCFC should be on a hard transfer embargo at the end of the month, no one has come in yet. Despite all the press releases by the club they still haven’t stated that they meet the P&S loss limits for all seasons.  So looks like a points deduction this season as well.  Also heard that a couple of senior contracted players are negotiating moves away.

So small squad, points deduction and Rooney as manager should mean an exciting season propping up the table.

2 hours ago, havanatopia said:

Some may recall the malfeasance, or so it was labelled and prosecuted as, about 25-30 years ago; Arthur Andersen, and others, submitted accounts, possibly for Polly Peck. In front of the judge they pleaded ignorance to false accounting because, they said, we can only go on the document from the client. The Judge 'laughed' them out court saying they were, at best, complicit, and at worst directly involved in cooking books. After all, he said, how could you sign off a set of accounts that bore no resemblance to any that had been in the previous 5 tax years in which you represented the client; did you not once stop to ask them what is this?

Polly Peck no longer exists of course and AA closed its doors in the UK as Accountants, soon thereafter.

Unfortunately the Football League is like a timid cat compared to the roaring lion of the FInancial Conduct Authority.

Just to clarify the record - Andersen where found guilty of criminal offences in 2001 following Enron later the convictions were reversed by the Supreme Court.  Neither business now exists.

Polly Peck went bust in 1988 and their accountants were admonished by the regulator.

3 minutes ago, Davefevs said:

Wasn’t the auditor a life-long Derby fan (no issue with that per se) but with links to Morris?

More than likely on both counts - small firm - small town - big client - probably had his 'gut feeling' turned a little low - still reckon he was had.

1 hour ago, Mr Popodopolous said:

What's your thinking on the unlawful argument? Derby have claimed that a deduction in 2020/21 would be just that. It's an argument I'm unsure on.

Round Objects.

3 hours ago, Mr Popodopolous said:

Bit of a rookie error for experienced Auditors

No it's not.

Simply put DCFC misled the auditors.  Para 25 of the LAP decision says:

" ... because the explanations in the accounts did not reflect the treatment which the Club
contended, and the DC accepted, was in fact adopted, the DC found the charge proved
as to the fifth particular. Indeed, the erroneous explanation of the treatment in the accounts
mirrored that in the Draft Audit Findings Report of the auditors for each of the relevant
years, which were also incorrect and misleading."

and Para 86 goes on to say:

" ... the Club had misstated in each of the Accounts the treatment which had been adopted by the Club
in relation to amortisation. That seemed to us to raise questions as to how far the Club’s
auditors had fully understood the accounting treatment they were adopting and its basis."

12 hours ago, Davefevs said:

@Mr Popodopolous did you or someone have a calculation of the annual impact of using a straight line amortisation model on Derby’s accounts?  Does that tip them into P&S breach, and therefore points deduction territory?

I thought it was tight enough with stadium sell, but seem to recall a £30m amortisation discrepancy, possible worse?

@Hxj you may know too???

My understanding has always been that DCFC the amortisation methodology was used by Derby to avoid failing FFP.  Reading the decisions it was clear to me that the question always asked was 'How little do we need to avoid a problem.'

The EFL seem to agree.

Mind you I did spill my coffee all over my desk when I heard the news.

3 hours ago, Mr Popodopolous said:

Derby fans seem quite bullish reading their forum

I think it would help some of the delusions if they actually read the cases!

3 hours ago, Mr Popodopolous said:

but who hears the Appeal?

Yep to the LAP.

3 hours ago, Mr Popodopolous said:

the League Arbitration Panel found them guilty in the first place

Well a LAP did find then guilty, but another LAP will hear any appeal, even if it consists of the same members technically they are different panels.

Derby retained list now out - on www.dcfc.co.uk - 14 senior players retained and 5 in discussion.

The interesting one is Jack Marriott whose contract extension was triggered by Derby in December but rejected by the EFL.

And the other interesting piece is the lack of a retained list from Derby

Local media, local to me and Derby that is, are reporting that the Derby punishment will be announced next week.

2 hours ago, AnotherDerbyFan said:

You mean like this club statement?

"even if the EFL succeeded, would have only lef to the Club re-submitting its P&S calculations".

Except, you've already stated you don't trust a word the club say...

I am happy to put on record that I believe every word of what the club are saying in their press releases in respect of the disciplinary action.  I just think that they are misleading, open to interpretation and very, very well crafted.

I completely agree with the club that in the strictest and narrowest possible sense (and ignoring any penalty for non-compliance) the only possible outcome of the EFL winning the appeal is that Derby will have to resubmit the relevant P&S computations.  That is obvious.

What is completely missing is the next step.  What happens when those P&S computations are resubmitted?

I have always fully accepted that you might be right, but if I was a Derby Fan I would be concerned that the club have not stated that they meet the P&S loss rules for all years.  It's a simple sentence to add to the press releases, and quick to craft.

18 minutes ago, AnotherDerbyFan said:

Nothing official, but it's also hinted at in the charge. To paraphrase:
Charge 1 - related to a true value of the stadium would result in being over the limit and failing P&S
Charge 2 - the amortisation policy isn't compliant with FRS102

Pull up the official document(s) and take note of the actual wording. Rather than just being "non-compliant" it would have mentioned failing P&S if it was the case.

Whilst all that is noted and understood you also need to take into account that was not until a week or so before the Independent Disciplinary Committee hearing that Derby County finally made the EFL aware of the actual amortisation method used. 

Taking that as a fact (it is mentioned in the IDC decision) then the absence of a P&S failure in exceeding the loss limits is not at all surprising.  They simply didn't know. 

Looking at it another way, it is for the EFL to prove their case.  If they cannot cover the basics on that any charge would have to fail. 

Better to wait and see what the actual outcome is.

As I have asked before.  If Derby have not breached the P&S loss limits why don't they simply come out and say so?

It would have been quite easy to add a sentence of meaning to the otherwise absurd press release that did come out.

2 hours ago, havanatopia said:

I sincerely hope we see an immediate return for Wycombe and a single finger salute directed to Derby as they go in the opposite direction.

I have nothing to add to that.

20 minutes ago, Mr Popodopolous said:

Nailed it. Brown envelopes were probably a lot cheaper also.

Derby is still ongoing, I believe both sides have the right of appeal after the IDC hands down the sanction- or lack of!

Based on precedent, League Arbitration Panel bit is fairly binding, IDC can seemingly be appealed. What's happened here is unusual in that IDC handed down innocent verdict, EFL Appealed and won in part in front of the LAP. 

The LAP would have had the power to hand down a Sancton but referred this bit back to the IDC. IDC are the lower body, LAP the higher one.

Both will now make cases/representations to the IDC and I can only assume that any Appeal would be heard by the Upper Body- LAP- and this would be the disposition, the final decision.

Pass the parcel between Independent Disciplinary Commission and League Arbitration Panel though feels fairly unusual.

Just to fill in the gaps.

In the Derby case both parties have the right to appeal any decision of the IDC to the LAP.  The LAP decision is final in all respects.

The problems with the LAP determining the sanction in respect of the 'amortisation' decision are three fold:

1. Firstly the LAP had no power to impose a penalty in respect of the 'misleading' decision as the actual decision was not before it.  Derby admitted this and the IDC confirmed that decision and it was not under appeal.  So you could have two different panels imposing different penalties in different ways.
2. A sanction decision by the LAP cannot be appealed.
3. The 'elephant in the room' being that if the decision of LAP means that Derby fail FFP loss rules then that is the real offence.  In that case that sanction, being a potentially very significant points deduction will become the real sanction and the other two charges will become aggravating factors in arriving at that sanction.

1 &2 are really sensible reasons from a natural justice perspective and third simply reflects the reality of the position.

All in all painful - but they will get there.

3 hours ago, Redstart said:

The fact that Derby will get their comeuppance a season late will be absolutely no consolation to Wycombe who will have been shafted by then anyway. 

I have a huge amount of sympathy for Wycombe.  I hope that they will be back.

There is the option of Wycombe asking for Derby to be expelled at the AGM, but I would be really surprised if that was even discussed let alone voted on.

I think that there are a few clarifications needed.

Firstly as regards other clubs and lawyers you won't see any court action.  Part of signing up to the EFL is that you agree to exclusively use Arbitration with no recourse to the courts.

Secondly it is not the EFL which punishes clubs, but the Independent Disciplinary Commission.  That has to meet, listen to the evidence and then agree on a punishment.  That punishment is the subject to appeal by either party. 

Thirdly the added complication in Derby's case is that two charges of breaches of the FFP rules were found proven, one (misleading) by default as Derby admitted it and the second (incorrect amortisation) by the League Appeal Panel.  But they were not charged with a breach of the loss limits as a result, as simply put the EFL didn't know. If Derby are now in a breach of the loss limits then they might needed to be charged again, and then the process starts again.

I doubt that there will be a final resolution until much later in the year.

The EFL certainly could have handled matters better and more effectively, but they did actually pin two proven charges on Derby against fierce resistance.

I'm not sure the delay is going to save Derby for anything more than one season.  It would appear that they are still under a transfer embargo, possibly a hard one by now.  That with a potential significant points deduction in the upcoming season is going to make their life very difficult. 

48 minutes ago, BetterRedthenBlue said:

https://twitter.com/KieranMaguire/status/1399990128936992769?s=19

Saw this from Kieran about MM possibly being struck off would this have any impact on Derby at all? 

No.  Separate business.

In another development - a banker involved in the same tax fraud as Gabay was sentenced to 5 years or so in prison, along with a confiscation notice.

If Gabay's business is still owed money by Derby, he might need it back fairly quickly!

4 minutes ago, Mr Popodopolous said:

What I meant was

I know - just gently pulling your leg!

Back to the Ricoh - horrible place - and then with luck on to a new stadium 

24 minutes ago, Mr Popodopolous said:

Coventry- literally nothing to write home about P&S wise in terms of trouble etc. This was on a League One income and would have included mid March to end of May pandemic wise. Needless to say, their Embargo is lifted.

https://www.ccfc.co.uk/news/2021/may/news-coventry-city-publish-accounts-for-year-ended-31st-may-2020/

I fundamentally disagree!

Been through some rough times over the years I remember watching City play then at Northampton where there appeared to be more away fans than home fans.

The statements by the club and the accounts are crystal clear.  They have even taken the trouble to explain the relevant details.  Personally I would write home about that, and how I wish everyone would follow their example.

@Mr Popodopolous I see no issue in selling within the Bet 365 group, probably simplest to keep a common parent in case the ownership of the group and the football part ways.  Keeping the ownership within the same group helps on the tax side.  I think that the EFL restriction is too keep the stadium as a simple sale and lease back, rather than confuse the issues as to what is football income and non-football income.  I don't see that restricting ownership outside the football group.

Given that revaluation is not a profit for FFP, neither is depreciation, I see profit as DRC - Cost as you say.

Sheffield Wednesday are a League 1 club now so I really don't care on FFP, I do care about the club which by all accounts is currently imploding.  I fear that if they fail to get promotion next season they might well disappear for some time.