The Championship FFP Thread (Merged)

[Mr Popodopolous]

7 minutes ago, Ostrich said:

Yes they seem to be applying the new UEFA rules because I’m pretty sure the Premier League hasn’t changed yet to come into line with them.

I don’t doubt we needed to do something for existing PL rules but the complete lack of activity last summer from us seemed to be about coming in line with UEFA rules/getting us ready for a PL rule change. The reason this was believed was because before the UEFA rule change came about, there was talk about a big rebuild in the summer, then come pre-season after the full details had been released in April/May it very clearly changed. But it didn’t end well so I’m not sure Wolves need to worry about UEFA rules right now too much.

It was reported as far back as April 2022 that the Championship ones would also come into line with these.

Still waiting..my best guess is that such a move is contingent on TV distribution changing between PL and Championship. 

As far as I know although you might be able to correct, Leeds, Leicester and Southampton all need to fall within the £83m Profit and Sustainability adjusted loss target to.this season, the ratios with wages etc haven't kicked in yet.

Unsure how Future Financial Information side of the 3 year losses works in respect of newly promoted and relegated sides.

[Mr Popodopolous]

Best guesses here.

Leicester City seem to be to be most of interest from the 3 year rule of the relegated sides but that said have sold  Maddison into last season's accounts and Barnes into this.

Barnes was £38-39m. Pure profit, think Hirst was £1-1.5m, probably also pure profit.

Maddison was £40m minus remaining Book Value and sell on to Norwich, Schmeichel £1m and Fofana £75m minus remaining Book Value and anything to his original club in sell on.

Wages down and a big amortisation saving in terms of those who left on a free. I estimate £20m and £25m respectively.

Maybe a fall of £80m in existing wages from PL and £10m year on year 2021-22 to 2022-23.

On the debit side:

European income non existent, £20-25m falls off last year.

Parachute Payments and EFL money combined probably rise to £50-60m. £129,284,000 in 2021-22.

Cost of additions- amortisation alone

2022-23:

Faes- £15m/5, £3m.

Souttar- £15m/5.5...£1.36m roughly in 2022-23, double thereafter £2.72m.

Kristansen- £17m/5.5, £1.54m roughly in 2022-23, double thereafter £3.08m.

2023-24:

Hermansen- £5m/5=£1m.

Coady- £7.5m/3, £2.5m

Winks- £10m/3, £3.33m.

Doyle is cheap as chips reportedly, £500k for the season on loan. For a player of his level.

Sacking Rodgers will have cost.

Small cost to be added with Smith and Maresca.

Oh and Mavididi- £6.9m/4..about £1.725m.

I can't say with certainty despite sale of Barnes, Parachute Payments and some wage falls that they are on course to comply as it stands to 2023-24.

£83m adjusted Upper Loss Limit.

Edited July 27, 2023 by Mr Popodopolous

[Mr Popodopolous]

Shock! Shock!

Cardiff fans speak about FFP on Twitter. A journo too.

Apparently they are well within FFP rules and or have plenty of budget left. Does this stack?

Then again maybe the new rules have changed things, if there are any..EFL Handbook seems not to be out yet. 

@Davefevs @W-S-M Seagull

Edited July 27, 2023 by Mr Popodopolous

[W-S-M Seagull]

38 minutes ago, Mr Popodopolous said:

Shock! Shock!

Cardiff fans speak about FFP on Twitter. A journo too.

Apparently they are well within FFP rules and or have plenty of budget left. Does this stack?

Then again maybe the new rules have changed things, if there are any..EFL Handbook seems not to be out yet. 

@Davefevs @W-S-M Seagull

I don't think Cardiff fans understand FFP. 

Every time I speak about it they always mention the embargo. Bizarrely they seem to think because they've paid the fee, that makes them within FFP. I think they get confused between the two. 

[Mr Popodopolous]

4 minutes ago, W-S-M Seagull said:

I don't think Cardiff fans understand FFP. 

Every time I speak about it they always mention the embargo. Bizarrely they seem to think because they've paid the fee, that makes them within FFP. I think they get confused between the two. 

The last one is a journo who perhaps was only relaying the clubs view but I do agree.

I mean, I've only really engaged on Twitter but another line I often see is that because they spent fees for x windows they can't possibly be in breach.

In relatively modern times they've been cushioned in a way. Rich owners ore FFP ie Hammam onwards and then PL and a Parachute Payments, following a couple of yoyos.

The test will be March I guess when club's projections go in or perhaps next summer at the latest.

[Rob26]

whats leeds numbers for ffp look like

[Mr Popodopolous]

Think they're okay although it's hard to tell.

They lost £40 odd million before tax in 2021-22 iirc but this will have included a £40-45m survival bonus.

Phillips and Raphinia the following year will have generated a large profit but at the same time, players were added, managers came and went which adds cost base.

The £40-45m survival bonus was not.applixaboe to 2022-23 as, well they did not survive so that surely all things being equal sees £40-45m of Operating costs disappear. Whether Survival Bonuses would count against FFP anyway I really am unsure- they definitely should.

Like Leicester and Southampton they're on the £83m but surely coming down with less accumulated losses than Leicester e.g.

[Mr Popodopolous]

In respect of PL Profit and Sustainability I found this interesting as far as a new addition goes. Up to the EFL to keep up with this bit, not fully read it myself yet.

[Mr Popodopolous]

In other words, Everton got lucky that their case wasn't heard in 2022-23 as it should have been. This rule specifically appears to mitigate against that happening again.

If they could between them bring forward some kinda rule whereby points can he docked there and then off basis of 3rd year forecast and 2 year actual, then appeal or maybe have the deduction pending ready to be removed if put right by end of May/June. That would be great.

Edited July 28, 2023 by Mr Popodopolous

[Mr Popodopolous]

https://www.therandompundit.com/post/are-forest-digging-themselves-into-a-financial-hole-ffp-analysis

This could be interesting. About to read it.

Hmm?? If Year 1 was an £18.7m loss for FFP they FAILED. Failed. To 2022.

Pre-tax position and remember Covid years aggregated and halved, some of the Covid add-backs.

£39m limit.

2018-19..-£25m

2019-20..-£22m

2020-21..-£22m

Obviously debt write offs in the Profit and Loss account don't offset FFP or actual losses. Think there was one or two in that period of £5m but disregarding this.

2021-22..-£47m

Think their starting point prior to deductions was £94m in losses. Clearly-£20.9m but their third year Covid number projected was very dubious.

£12m in 2021-22??

Edited July 30, 2023 by Mr Popodopolous

[Mr Popodopolous]

We went into hardline cutbacks in summer 2021 and these begun then, Nottingham Forest sacked Hughton, hired Cooper, and their baseline wage bill didn't fall, rose a bit actually.

I'm not at all convinced they were within the 3 year limit to 2022. The 3rd year Covid loss which was a nonsense maybe tipped the balance.

For context they not unreasonably argued that they lost about £8m in 2019-20 and the same again in 2020-21.

They then Projected a Covid loss of £12m or so in 2021-22 when there were zero restrictions! Bit of impact sure but not 50 pct higher than the 2 genuine Covid seasons..

They sold nobody of note, apart from the Carvalho to Olympiakos which was a likely couple of million profit.

Edited July 30, 2023 by Mr Popodopolous

[W-S-M Seagull]

On 28/07/2023 at 14:11, Mr Popodopolous said:

In other words, Everton got lucky that their case wasn't heard in 2022-23 as it should have been. This rule specifically appears to mitigate against that happening again.

If they could between them bring forward some kinda rule whereby points can he docked there and then off basis of 3rd year forecast and 2 year actual, then appeal or maybe have the deduction pending ready to be removed if put right by end of May/June. That would be great.

FFP breaches need to be punished punished far more quickly in my opinion. Because of how long it takes, it compromises the integrity of the game. Everton should 100% be a Championship club right now in my opinion. 

[Mr Popodopolous]

7 hours ago, W-S-M Seagull said:

FFP breaches need to be punished punished far more quickly in my opinion. Because of how long it takes, it compromises the integrity of the game. Everton should 100% be a Championship club right now in my opinion. 

Agreed. This verdict will be a year and  half after the period in question, the case itself a rough timeline is:

*Accounting period ending summer 2022 ie 2018-19, 2019-20 and 2020-21 combined average and 2021-22

Given present submissions and future monitoring it seems mad thst it took until late March 2023 for a charge to be brought. I would argue they should have been charged for the huge losses to 2021 but if not then summer 2022 when the Projections updated- saw it in the EFL with Birmingham, Reading the real-time element.

Everton wise. The precedent would be some kind of referral in August, September 2022- otherwise they should not if there was doubt have been allowed to add players for fees in the market.

Derby to an extent but not so much, Sheffield Wednesday was botched by the EFL even if the correct outcome arose in the end.

Edited July 31, 2023 by Mr Popodopolous

[Mr Popodopolous]

Ironically the new rules may well allow for it, the next club may not be so lucky given the bringing forward of Accounts to the PL deadline.

Edited July 31, 2023 by Mr Popodopolous

[Mr Popodopolous]

https://efl.com/governance/financial-regulation

Looks like the Regulations are continuing to develop, it looks new this. Will read it properly later.

EFL 2023-24 Regulations out too.

https://efl.com/governance/regulations

[Mr Popodopolous]

Having had a quick read of the FFP regs, the £39m limit has not changed at all despite what some Cardiff fans like to claim! Equity takes back up to £39m or such limits that may apply via yoyoing but there is no reference to equity or debt write offs increasing limits. £39m if us, if Champ-PL-Champ £61m etc.

Call-in review eh. I wonder if this means that In-Season Projected Breaches can be referred in real time at last!!

Edited July 31, 2023 by Mr Popodopolous

[Davefevs]

17 minutes ago, Mr Popodopolous said:

Having had a quick read of the FFP regs, the £39m limit has not changed at all despite what some Cardiff fans like to claim! Equity takes back up to £39m or such limits that may apply via yoyoing but there is no reference to equity or debt write offs increasing limits. £39m if us, if Champ-PL-Champ £61m etc.

Call-in review eh. I wonder if this means that In-Season Projected Breaches can be referred in real time at last!!

Ignorant fans, simple as.

[Mr Popodopolous]

22 minutes ago, Davefevs said:

Ignorant fans, simple as.

I'd say so. There does seem to be an odd confidence and lack of urgency about Cardiff and FFP however as a club.

One of their local journos said club sources implied they were well within. Of course I suppose they might not be keen to feed local journos negativity.

The loophole that Reading sought to utilise in terms of sale of Intangible Assets owning Tangible Assets also seems to have been shut.

Edited July 31, 2023 by Mr Popodopolous

[Mr Popodopolous]

More in the here and now, the accounts for Sheffield Wednesday are due out today.

[Mr Popodopolous]

Oh yes the relevant rule.

That Reading loophole, worded clunkily by me?

Closed.

 

Edited July 31, 2023 by Mr Popodopolous

[Mr Popodopolous]

Now I'm happy to admit when I'm wrong.

Sheffield Wednesday wage bill l fell by £12m in a season. Clauses? That's oddly astute of Chansiri.

 

Cash Flow was also of interest..perhaps moreso. Certainly within FFP even if you subtract or disregard a small profit on disposal of Fixed Assets.

They just have another £15m in deferred Proceeeds due from the Hillsborough transaction. Whereas they are certainly paying down their loans from him.

[Mr Popodopolous]

I was highly sceptical about some of the claims but there we are. The cash flow statement is a bit odd- debt paid down £13m net- yet the Loan due back up to £56m.

They seem to have got some kind of Insurance claim come in from Hillsborough being shut during Covid, R&D tax credit and EFL it was ruled paid the legal costs for their FFP case- all of which should be reflected in 2022-23.

Edited July 31, 2023 by Mr Popodopolous

[Mr Popodopolous]

He also seems not to be putting in share capital etc.

Which means they maybe operating as it stands at the £15m adjusted loss limit. That's probably a reasonable thing from a solvency and sustainability perspective but well it would explain the relatively tight summer to date.

Worth noting thst the £30m in deferred Proceeeds across 2020-21 and 2021-22 took them to a mere £800k-1m in Cash Balance but I think they're overall doing alright.

[Davefevs]

With Wednesday’s accounts in:

we now have a full-set for 21-22 season.  There will obviously be some deviance for those clubs who publish holding / group vs club, but I’ve highlighted the wages column.  We should see a good drop for the next set of City accounts.

[Rob26]

22 hours ago, Mr Popodopolous said:

Agreed. This verdict will be a year and  half after the period in question, the case itself a rough timeline is:

*Accounting period ending summer 2022 ie 2018-19, 2019-20 and 2020-21 combined average and 2021-22

Given present submissions and future monitoring it seems mad thst it took until late March 2023 for a charge to be brought. I would argue they should have been charged for the huge losses to 2021 but if not then summer 2022 when the Projections updated- saw it in the EFL with Birmingham, Reading the real-time element.

Everton wise. The precedent would be some kind of referral in August, September 2022- otherwise they should not if there was doubt have been allowed to add players for fees in the market.

Derby to an extent but not so much, Sheffield Wednesday was botched by the EFL even if the correct outcome arose in the end.

they should have agreed budgets at the start of the season I think.

all accounts in before end of season even if by companies house they are not required yet they should have to submit to their leagues authority, showing actuals to date for current season and expected for next season.

then the league returns back to them what their allowance is for the season.

every transfer in and out includes an update to the forecast and deduction/addition to the budget and has to be required for successful transfer of a players registration.

if clubs have new revenues they can apply to changes to their budget.

then if clubs are looking to breach, the league should know about it before the season is out, effectively unless they have reported false figures they should be in a position to know where everyone is going to end up based on current transfers by feb.

it would also instil a culture of more effective monitoring too. fines from ffp could go towards the costs of providing this service to the leagues.

https://www.skysports.com/football/news/11095/12929532/chelsea-fined-8-6m-for-ffp-breach-as-juventus-banned-from-europe-for-23-24-in-separate-financial-case chelsea fine 

[Mr Popodopolous]

Wonder if Birmingham are edging back towards FFP again. Pre Bellingham they were on track for successive losses before tax of around £25m.

Chong and some probable wage savings helped further but £39m...hmm.

Cardiff absolutely more so, £26m whixh even included £4m in profit on disposal of players.

QPR £24m and maybe a few million less laat season, Dieng and Dickie sold, Johansen out but more to do?

Leicester £83m adjusted Upper Loss Limit, already lost £92.4m before tax in Year One and have spent a few quid this summer hmm. Yes I know Barnes but is it enough to get within £83m limits to this season. Maddison fell within 2022-23 by the looks.

Has to be enforced in as real time as possible, without fear or favour.

I even wonder a little bit about Preston, their allowable costs are quite low.

Edited August 1, 2023 by Mr Popodopolous

[Mr Popodopolous]

It feels like something that is easy to resolve tbh..It shouldn't have FFP implications but could it- and should they be able to register Players while contractual obligations still outstanding as they appear to be?

I recall Lamouchi v Nottingham Forest at the CAS was mentioned in 2021-22..Seems to have disappeared from prominence but he took them to the CAS.

[bcfcredandwhite]

Forest situation reported in the Daily Fail:

Nottingham Forest owe MILLIONS in overdue payments to players and agents, with legal action being considered if they don't settle the debts imminently | Daily Mail Online

 

[Rob26]

https://www.bcfc.com/news/all/tom-brady-invests-in-birmingham-city-football-club

I imagine forrest if they dont make the payments when complaints come in will be embargo'd

[Mr Popodopolous]

3 hours ago, Rob26 said:

https://www.bcfc.com/news/all/tom-brady-invests-in-birmingham-city-football-club

I imagine forrest if they dont make the payments when complaints come in will be embargo'd

They've already signed Elanga and Wood albeit prior loan to buy. A very cynical approach may to be to try to get as many as possible over the line and outrun the complaints, taking the embargo while finding time to pay.