Mr Popodopolous

Another Aston Villa point. Article from last year... Back to the time of the Aston Villa takeover last summer. That is £54.54m or thereabouts. Villa Park alone? £56.7m. Granted, Xia was looking to get any investment as he couldn't get cash out of China, distressed asset etc etc but when you factor in the 2015-16 Impairment too, you really do wonder...Aston Villa really were close to administration at best! Xia purchased them for £60m, though that did not include £30m payable to Lerner on promotion...still I find it tenuous with these factors or at least open to question how Villa Park in isolation was worth £56.7m. Recon Sports Limited (back then under Lerner, known as Reform Acquisitions Limited)- Accounts to May 2016. Go to the following: Now we all know what player Valuations are like and anyway the write down of player value doesn't count so much anyway so don't worry on that score! The second one though, is what I was driving at before. Recoverable amount? Well, it's the greater of an assets fair value less costs of disposal or value in use. To me, "disposal" is actually doing just that- selling for real. Perhaps Accounting rules say different though! In fact, the exact Impairment for the Freehold Land and Buildings- which is surely Villa Park- is £44,593,000. I suppose the Freehold land which has not been depreciated maybe included which could bump it up a bit? No real indication as to what that is. Then though, that would surely have a drag on the Profit on Disposal if so.

What truly baffles me on a general note though, is how Hillsborough- valued on a DRC basis in 2014 at £22.25m and a Revaluation Reserve of £6.778m, becomes £60m in 2018 (if it was even sold that year). Magic!! Chansiri is a magician- was there oil, gold or similar found under the site or something? Seemingly built in and around a flood plain/flood zone too, if that makes any difference. Also read that its designated use is leisure only- again, don't know if that's so relevant. I note that in 2013, there was a Revaluation Reserve of £3,615,000- that is the accounts for 2012/13 season. This became £6,778,000 in 2017/18. A gross uptick of £3,163,000. The total unrealised gain in the P&L was £3,276,000- Revaluation upwards in Tangible Fixed Assets for that year was £1,518,000... £60m though?? Oh yeah, the reason I state 2014 is because the last time that a valuation was disclosed on the balance sheet. The Revaluation Reserve naturally decreased in the subsequent 3 seasons- there was some work done perhaps but both this and the existing Net Book Value would still have been subject to depreciation too. Hence how I come to my valuation of around £30m or so. Edit, just looked- in the 3 years post 2014 Revaluation in accounts, they added £1,211,000 in terms of "Additions" under Tangible Fixed Assets- but this is gross of Depreciation, which came to £1,547,000 in those 3 seasons. If it's much above £30m I'd be interested indeed!

An embargo of some sort seems to be, if we follow the Birmingham pattern a holding pattern- notice that there is a problem, a first stage? Perhaps was even a full embargo! He did not! Along with a number, I believe he was sidelined to try to help ease him out to show willing in terms of compliance. Birmingham did similar last season with a number of players. Rhodes returned as well, presumably on full wages- was only a loan (with wages covered) and a loan fee- helps yes but nothing permanent or taking into 2019/20 to improve things. Makes me continue to, and indeed increasingly strongly suspect that Hillsborough transaction appearing in 2017/18 accounts is very interesting!! Line 1 here- and arguably lines 2 and 3, make me seriously question whether the Transaction of Hillsborough, combined with the reporting date, corresponded! https://derbyunifootyjournos.wordpress.com/2018/08/07/owls-chairman-dejphon-chansiri-confirms-clubs-transfer-embargo/ The article has done nothing to assuage my suspicions and doubts- that I first voiced in July and elaborated on in September. A full week before the Times reported on the EFL raising questions. Saw this article earlier. @Coppello Thank you for the response- will do so in depth later, but that is interesting stuff- the major shift in thinking. You clearly are a lot better qualified than me, but I wonder...if Villa Park proven overvalued then it could become a live issue again. The impairment issue looks pretty interesting- my view is that these assets were impaired in order to reduce price of purchase for Xia maybe? Or in advance of a prospective sale- and Intangible ones obviously due to relegation, to maybe try to make a better profit on players sold? I still seriously wonder about this though- clearly the EFL couldn't catch Aston Villa but it is worth noting that Purslow back in the summer was purportedly pushing for a public statement from the EFL which would confirm the passing of FFP...in the absence of one, we certainly don't know. Definitely it's deliberately vague though, to leave many options open- or the threat of many options open I reckon. From what I've seen when looking at Aston Villa's accounts in recent times, I can't see reference so far- but will look again in more depth- to impairment testing, or anything like this. My point I'm trying to make I guess, is questioning whether the Impairment fits the relevant Accounting rules and criteria- and therefore should be looked at afresh in terms of FFP calcs. Clearly a Revaluation Reserve is if value goes upwards but can a Revaluation Reserve be applied in the same financial year as a Revaluation and subsequent sale? It basically doubled Villa Park, on promotion- the Impairment % from the original Impairment about 62.5%, without factoring in Deprecation in the following 3-4 years, was added back on to value. £28m or thereabouts of £44.8m, possibly actually with Depreciation factored in.

Interesting line on it this morning. https://www.telegraph.co.uk/football/2019/11/03/exclusive-cardiff-city-face-three-window-transfer-ban-fail-comply/ Update. Appeal to the CAS is possible- probable?

Hi @Coppello Apologies if I've already asked, or referred to this one- I've asked about similar before but this is quite specific. Thinking specifically about Aston Villa if they have significantly overstated the value of Villa Park for example. In short, to your knowledge is this just an EFL declared thing or a fairly watertight agreement? Certainly, I'd interpret that as leaving the door open to future action on return, or the possibility of parking a punishment if PL wouldn't enforce, or holding a possible EFL Hearing in reserve etc. While I'm at it too, is it at the discretion of a club as to when to review/amend impairment of assets? Can't see how Villa Park down by £44.8m in 2015/16 then up again by £28m or so 3 years later. Is regular testing, and equally regular disclosure of such not required then? Plus reasons being stated- I haven't found these anywhere to date. Seems quite a shift up and down in value for an asset- Villa Park- that has remained largely the same between 2015/16 and 2019.

Had a look back at Derby and their takeovers, both by Mel Morris and in the late 2000's. Mel Morris 2015/16 season- Sevco 5112 Limited- NO Fair Value Adjustments made, ergo the Net Book Value may not have differed all that much from the Fair Market Value. in 2008 or 2009, Global Derby UK Ltd- the club possibly at or preceding their takeover got it revalued in December 2007 yes, at £55m- guess how many Fair Value Adjustments made? Zero! Other notably- or possibly not- aspects include a Revaluation Reserve on the Derby accounts but not the parent company at time of takeover- in both cases. I wonder then, given that it was Revalued to £55m in 2007, why then was there still a Revaluation Reserve thereafter- Pride Park truly worth nearly £95m in 2007?? How was that Revaluation Reserve accounted for in 2008 and subsequent years? Is there some formula of Net Book (Carrying) Value + Revaluation Reserve? In 2007/08, the Unrealised surplus on revaluation of Stadium was equal to, the Revaluation Reserve- certainly the numbers were the same. Yet I struggle to believe that as of December 2007, Pride Park was worth £55m + £39,554,000=so about £94,554,000. Unrealised in terms of profit maybe? Will post a few screenshots later- still inclined to think Pride Park in the range of £50-55m, £60m at a push at time of sale. Yes there was work done, yes that enhances value- but remember the Depreciation. The expert who suggested it was worth <£41m though is most intriguing! Sheffield Wednesday? Well there's been nothing of note Infrastructure wise at Hillsborough for a while. Valued at DRC in 2014 at £22.25m- there was a Revaluation Reserve- unrealised- of £6-7m- can only assume ground worth not much more and quite possibly less than £30m surely? That Revaluation Reserve did of course decline between 2014 and whenever the ground was sold! Aston Villa intrigues me owing to their Impairment of Villa Park in 2015/16- yes it's an accounting trick but interested in how it works, add back on Impairment or a chunk of it. Surely there would be strict Tests, criteria, formula- etc. The Cost of Impairment was £44.8m in 2015/16, yet they sold it for £56.7m in 2019- or roughly double Net Book Value- which makes me think that £28m or thereabouts was added back on at time of sale. Very interesting to read what this is- how they shall justify it in their accounts! The PL, EFL and yes other clubs should be looking very closely at this. Mind you, what exemptions applied to lack of disclosure of 2018 independent valuation for Derby, 2018- we assume- one for Sheffield Wednesday, likewise for Reading. Wonder if Aston Villa will disclose theirs too. Oh yeah, Hillsborough- probably £30m or so at Depreciated Replacement Cost.

Dunno the context but when searching for something else an amusing Tweet- wonder who it could be about. They who laugh last though...because we're in safe hands and nowt to fear from any FFP regs- they OTOH, have a very interesting £60m transaction that it basically hinged upon, plus questions over whether Reporting Period matches Transaction date. If one or both of those 2 factors are wrong, wow. Another amusing thing was I- though far from alone- posted in some depth about Sheffield Wednesday date of transaction vs reporting period back in the summer and then again one week in September except more succinctly...then about a week later, a story arose that the EFL were investigating this very matter! Now I take no credit in all seriousness, but the EFL were dragging it out somewhat... Serious note, for those who are interested- will be interesting to see how these Investigations into stadia valuations are doing.

Possibly too much to hope, but I see Keith Wyness Employment Tribunal over his Aston Villa departure is up soon. I wonder if any FFP regulation 'flexibility'/dealings will come out from the summer of 2018- I wonder...the answer would be probably not but! https://www.dailymail.co.uk/sport/football/article-7614755/AHEAD-GAME-Aston-Villa-braced-explosive-revelations-ex-chief-Keith-Wyness.html Regards some of the other valuations, these should be examined in some detail- all of them actually- as to whether the correct method was used, and whether there was yet another layer of misleading to add...ie valuation as if sold for commercial, residential and other property- by sold I mean sold outright- as opposed to sold for a lease to a third party, sold for existing use to a third party- or what we saw, a third party doing sale and leaseback. I remember one article did state, or at least intimated the idea that this had been done for one of the transactions- well if this is true, then as we can see they are still playing in the ground...FALSE INFO! Best case scenario is you deduct the difference between Existing use and sale for commercial, but it feels a lot bigger than that to me.

https://www.manchestereveningnews.co.uk/news/greater-manchester-news/bury-football-club-what-happens-17154213.amp Hope they can get the Phoenix club up and running- and hold Gigg Lane- and the sooner the better.

On and on he (assuming it's Dale) goes... https://www.buryfc.co.uk/news/2019/october2/statement-from-bury-fc/ Fair play to Kenwright too. Snippet from the Athletic- would have bought time if nothing else IMO.

No update on the story as a whole but news at the other Sheffield club that makes me wonder still further on the £60m valuation. Read an interview with Kevin McCabe yesterday. Was interesting stuff- relevant to this was the fact that he owned Brammall Lane and the training ground, Hallam FM Academy. Prince Abdullah acquiring these for the club as parr of the takeover is far closer to, perhaps even a complete, arms length commercial transaction, though there was a court case too. The combined total- £50m!! Training ground cost £20m to construct based on some fuerher research of mine, so a breakdown of this would be interesting to see...unsure when was constructed so I'd have to look more. @Davefevs @BobBobSuperBob @Coppello @downendcity @chinapig Any Sheffield Wednesday fans too, I'd be interested to see your take. EDIT: That combined total may also include the hotel but article made no reference. Some of these transactions go beyond FFP for me, these sale and leaseback arrangements with related parties!

It's not new material as such but I'd love to know how the following teams are in compliance and their current FFP positions- accounts for varied big European clubs are out by now, why does it take 9 months in the UK?? Look how quickly Birmingham's were out at the HKSE- 3 months after the accounting period until 30th June 2019 and 3 months sharp. Okay, mini rant over. Reading- soft embargo in summer, we know they sold Madjeski for £26.5m so that's a profit of £6.5m or so. Took their losses down to "only" £20m or so in 2017/18. They sold some and yes some high earners go, but then again to purchase Puscas, Joao,neither of whom I suspect will be on tiny wages, then to loan in Miazga, Ejaria and Boye- the latter a fresh one, the first 2 renewals. Rafael, Morrison, Pepe on frees and Charlie Adam too- may have raised a bit in the market but I can't see how they will be compliant by the end of this season, given the 2016/17 small loss/profit drops off the books. Still some of the departures and wage savings surely cancelled out by some of the free/loan additions. They apaprtently have an option or obligation to buy Ejaria for £3m in the summer too. QPR. I know that they have cut back certainly, and yes a fairly small loss in 2016/17, ably assisted by a frankly ludicrous 4 years of parachute payments despite yoyoing were lucky enough to catch the tailend of that, but they loaned both Wells and Hugill- surely not cheap- look at our terms for Afobe after all! Yes I know FFP deductions and that, but QPR being able to sign two on loan in a post parachute payment season seems incongruous- but then the lack of clarity over whether projected accounts are applied means it's possibly legit. Oh yeah, Birmingham. Their situation is clear as mud. Will their UK Accounts differ to their Hong Kong ones? Will there be e.g. a stadium sale and leaseback that was mooted in the former which didn't appear in the latter? Is it now 3 years of £13m which get judged next season to eliminate the 2018/19- or is it a separate one year period of £13m for last and this season? Because if it's the former they lost £31m in 2018/19 but tbh that seems not to include the Adams sale, oddly- at least according to HKSE results.

Demolition in the series for them it's looking like! Currently Tea on Day 3, 26/4 in their 2nd Innings- needing 309 to make India bat again! What is also interesting is that though India generally thought of as a trial by spin, nearly as many wickets have fallen to pace than spin- especially SA's. Possibly more in fact, certainly in this 3rd and final Test. Winning the toss each time and racking up a major 1st Innings in each Test seems to have been a major boost of course.

One thing I did notice when re-reading the article and checking the Birmingham case is that the law firm hired by the EFL were the same ones used in the Birmingham Independent Disciplinary Commission- ie Blackstone Chambers. Charles Flint QC works for them and was the Chairman for the Disciplinary Commission, before whom it was heard. Should anything be read into that law firm being hired for this one?

Decent read. http://data.parliament.uk/writtenevidence/committeeevidence.svc/evidencedocument/digital-culture-media-and-sport-committee/administration-of-football-clubs/written/105929.html?sfns=mo

Punishments and criteria- a flow chart would outline it ideally but don't have time for that. Test 1- Applicable to all. Is the EFL valuation roughly in line with the amount it was sold for- Fair Market Value the key thing for most. If yes, then fair enough if no, proceed to Test 2... Test 2- Applicable to all. If reduced and restated to the EFL figures, how does this affect the FFP submissions to May/June 2020 ie for 2017/18. If still in line then carry on, if not...proceed to Test 3. Test 3- Applicable to all. If the restated value pushes them into breach- and I suppose you could test the period of 2015/16-2017/18, 2016-17-2018-19 and 2019-20- essentially any season or period in which the transaction is applicable, then it's an EFL Commission as per Birmingham. Mitigating and aggravating factors etc, all legal style. OR Test 3- Applicable to all- Version B. Simply deduct points as per the formula outlined in the Birmingham case setting the precedent. Further points for consideration- Applicable to all: a) Should a significant overstatement of valuation be included in the EFL Commission or should this be a separate charge? You can argue this either way IMO. Should there in this instance be yet further charges for inaccurate accounting and submissions? Deliberately misleading the EFL in other words!! Should the methods of valuation be tested? For example I read in an early article that one had been valued as if sold for housing yet there it is, still being leased. Misleading at the very least and if the methods of valuation vs the reality are not commensurate with each other then- yes you've guessed it, even more charges? b) Specific to Sheffield Wednesday- IF it is proven that they have put something from 2018/19 into 2017/18, should this be yet another separate charge? Because say what you will about the other clubs, at least their transactions seem to have been clearly and definitively within the right accounting periods. To say nothing of the wildly delayed accounts- which again the other clubs have not done.

Story on the current investigations- wonder if PL and EFL jointly coordinating, as there seems to be nothing on Aston Villa. https://www.telegraph.co.uk/football/2019/10/16/efl-step-investigation-derby-sheffield-wednesday-reading-stadium/ This one isn't fading away quietly. Some interesting exerts from the article: Interesting. Standard. Some serious players then!! This last bit, although mooted in a previous article, nonetheless is a very interesting twist!? One more thing, I notice there are a lot less leaks than there were for the Birmingham Investigation. Better run post Harvey?

Sad day for Bury FC,- and for football- barring some last minute miracle. Case 87. Little bit of background which slipped through the media unnoticed. https://www.foreverbury.org/post/forever-bury-statement-14-10-2019 EHHH Think I missed this post by Andy Holt. "There was no vote". No guarantee they would've got back in but what a final indignity if accurate!! RIP, Bury FC.

The reports are unclear- whether it'd be gifted, sold separately or continue being rented from Morris- maybe it's the latter, he would still own the ground but the club and new owner still own the stadium. Read it's rent until 2038 at £1.2m or something- for an £81.1m transaction- very nice commercial terms and truly arms length I'm sure! The other bit is that once every 5 years, rent is or would be subject to upward only free market tests. That has potential to change the equation down the track.

? Interesting- seems Leeds owner turned down the whole suing of the EFL thing, despite an offer by Gibson to join the case. Said he agreed in principle but wanted to focus mainly on the football. I've got a set of sanctions in mind if any valuations were significantly overstated line and tests for sanctions which I'll post later. Another interesting story is that Derby are for sale for £60m apparently- well it's a story anyway. I wonder if it would include the ground- because if it does...serious questions to answer there IMO.

Think the valuation is the bigger issue personally. However we can't say for certain whether the right reporting period was adhered to, not without actually seeing the documents- IF it was the incorrect reporting period and that's merely an if, then the right step is to exclude it from the 2015/16-2017/18 accounting period and impose a points penalty based on the adjusted FFP result. Then it would be needed to checked for fair market value and would be adjusted accordingly. Of course if there has been a significant overstatement of value AND a dodgy accounting period vs transaction then that in turn should lead to further penalties. The ones I really want to see hammered are Aston Villa- had parachute payments, yet still did it- their fanbase seems to contain a high ratio of arrogant belters too. Yep, auditors themselves have come under scrutiny in recent times. Conflicts of interest in these sorts of things should be very much avoided and without looking to question professionalism, certain things make me wonder a bit with 2 clubs in particular on this front.

That is the million dollar question- why were they changed, who instigated it? Would also add when exactly they were changed? We believe 2016 but I still feel the when is quite important. Yes, it seems a bit of a soft line of questioning on reflection. David Conn or Kieran Maguire for example would be a very different proposition! Potentially the two Matts who actually swapped papers, possibly even direct job roles- Lawton and Hughes- both seem pretty sharp. None will be on his interview list! Like I said he seemed to have one or two interesting ideas but for me, the rule change- this leaves more questions than answers. I am assuming he did not instigate fair market valuations when Derby and Reading in 2017/18, possibly Sheffield Wednesday that said same season though it's not in the public domain, when the contract in place etc, Aston Villa season just gone- should he have been quizzed on this too? I know it's being done now but it's far too late in some respects, even were we to reach the final outcome with an adjustment made. Certainly in Aston Villa's case! Additionally, in the case of Sheffield Wednesday should he not have been all over the fact there was a possible discrepancy between sale date of Hillsborough and accounting period? Again, an ideal q for him! The interview thinking about it should also have asked him about Projected Accounts- did the EFL just ignore/forget these? Because for a long time the system was mooted as 2 years of real accounts and then third year of projected accounts as submitted by the club in order to prevent what we've seen in the past of sides who have clearly breached and by a good margin going up and flourishing as only judged retrospectively. If there were legal concerns about this fair enough but again, more questions than answers unfortunately! Serious note, I wonder if the EFL could take legal action against Harvey if it turns out that certain rules were just blatantly overlooked, disregarded or at best, significantly misinterpreted etc when he was in charge- ie projected accounts. Let alone valuations and even possibly on one case, the correct accounting period!

Shaun Harvey speaks- including on FFP! https://www.telegraph.co.uk/football/2019/10/09/wanted-hold-carabao-cup-draw-space-ousted-efl-chief-reveals/ The relevant sections...the headline with one of his ideas is a cracker though! Incidentally, I think he actually raises one or two good points, but overall he was useless... Denies a 2016 rule change was an oversight? Curiouser and curiouser...raises some serious questions IMO. I struggle to see why 18/24 clubs would vote for it when the majority comply or make serious efforts to comply with FFP! I think they already have mandatory wage cuts in the form of relegation wage clauses, but maybe not all clubs do and could they be higher? I agree though that a closure of the loophole should be tied to other reforms. Wage cuts repaid as a bonus in the event of promotion is in fact an interesting idea. The first bolded bit, makes me wonder further whether they appointed him as he's an idiot who won't bother much with oversight and is just somewhat of a patsy. @Davefevs @downendcity @chinapig @BobBobSuperBob @CyderInACan @Coppello you might be interested in this. Varied others too I suspect.

Not had a chance to look properly at accounting standards etc yet but two interesting lines on ground valuations etc. After some digging I eventually found in plain sight that St Andrews was apparently as per Al Majir sold for £30m to owners in sale and leaseback- sounds reasonable tbh! Profit 3.5-4 x net book valuie though if that transaction true, net book value seemingly somewhere between £7.5m and £8m could make it interesting again? The second one is the PL but I see that the company that purchased Upton Park for £40m- Boleyn Phoenix- sold it on for £60m. Profit according to WH Holding, £8.7m (or thereabouts) on sale of Upton Park to Boleyn Phoenix. Yet, it's unclear in the accounts as neither Cashflow nor Profit seem to show £40m but I could be missing something! As per Kieran Maguire of course, the 2nd one! Still have significant doubts over Hillsborough and Pride Park in particular though- Villa Park may pass the test, unfortunately but I wonder given a £44.8m impairment of Villa Park in 2015/16. EDIT: Have looked further back and yes, the £40m is somewhat explained- by Kieran Maguire, at a prior date. http://priceoffootball.com/west-ham-united-2017-financial-results-fools-gold/

Some lightish reading while I listen to City on the radio-! Owers summary will get me through... One thing I did note briefly in the FFP rules though it's unclear if it is exceptional items or not under the new or old regs. These need to be applied for, and heavily scrutinised against the backdrop of the FFP situation of the club, not just granted- well that's my interpretation anyway! Reversal of losses seems like the closest thing to reversal of impairment- and I'd suggest on first glance that suddenly reversing a loss, revaluing a tangible fixed asset (okay, stadium!) back up 3 years on from a major impairment of £44.8m is well outside the spirit of the regs- but not just the spirit and should've if at all possible been excluded from FFP calcs! Seems incredibly convenient...or valued by an independent valuer before the all-clear given. That latter point also would go for Derby, Reading, Sheffield Wednesday- and if they've done it, Birmingham. That could be another element of Gibson's case perhaps, regarding the regs not being applied correctly. Unsure of 11.3.1 still applies but if it does: It well and truly could be considered to cover the above!! Under duties of disclosure- and this is most definitely under the new regs, but in part it's unclear where the old ones end and the new ones start. Okay, Middlesbrough considering suing Derby probably doesn't fall under this either! Neither for that matter arguably does Middlesbrough considering legal action vs the EFL. Still think- though maybe clutching at straws- that the EFL not making a public statement as Purslow purportedly wanted declaring that they had passed FFP could end up making things interesting. Certainly if they make a quick return!