The Championship FFP Thread (Merged)

[Mr Popodopolous]

Credit to the excellent Swiss Ramble for this earlier in the year.

I am now making an assumption that they got £15m for HS2 as one comment on an article said and that it'd be in this seasons accounts. This therefore is strictly a best case or an ideal case scenario of mine.

Allowable loss:

£39m + £45m=£84m over 3 years- that's when taking into account allowable costs. That is more than plenty for any Championship club except if one of the top 6 got relegated suddenly for financial irregularities or match fixing say.

2017/18

£36m loss- £15m=£21m

2018/19

*£54m loss-£15m-£12m=£27m

Already in Birmingham territory in this their final year of Parachute Payments. About £9m above.

Rough calculations though it is, but if this is in the right ballpark- and let's say it is...

£54m loss-£15m- so the same as before- put pushing further into the red -£17m parachute payments and £15m in HS2/land and until sales occur, also subtract £7m in profit on transactions.

I therefore estimate a loss of £93 million- before FFP exclusions of £15m- so nearly double the 3 year FFP in 1 years!!

Or £126m in FFP adjusted losses for the 3 years to May 2019!!

Were the £15m this season for HS2 to have been fake news, it'd be £138m in 3 year FFP losses admittedly before sales, loanees and players released.

£50m in profit on player sales let's say and £15m in wages saved- or vice versa...even that would have them well in breach.

My numbers may not be perfect but they're in the right ball park- what's a few million between friends such as Villa and the EFL

In consideration of all factors therefore, I hope Derby smash Aston Villa...then get >11 points and have to rent Pride Park at several £m per year.

Edited May 17, 2019 by Mr Popodopolous

[Coppello]

17 minutes ago, Mr Popodopolous said:

Haha, knew it! Knew it- incompetent and in some ways reluctant to be too pernickety- but incompetent absolutely!!

Thank you though, that is very interesting stuff- and the difference between EFL and PL is evident. Mind you in terms of the base FFP in the PL- not talking the STCC thing- for that is slightly different but the £35m + allowable losses- with their TV money and commercial revenue- and marketing on a global level, it's almost impossible to fail! £105m over 3 years...makes sense in some ways but in others, forgetting parachute payments for a minute they also have £44m + any profit accrued in the prior 2 years to play with- should be £13m per year and allowable losses in PL IMO but that'll never happen.

@RoystonFoote'snephew Ah, did it? Thanks. Read on here at some point that it was June 9th- I'll go with what you say though, small window for Aston Villa if they lose that playoff final before it rolls over to 2019/20 financial reporting period.

Yeah, it wasn't exactly groundbreaking stuff but he did say quite a few things which did make me think. I agree with your point in terms of failing the PL FFP requirements, it is bloody hard to do. At the same time, they're marking you pretty tightly and query many of the numbers that go into your forecast. At the club I work at, the PL contact us with queries each week despite there being significant headroom. With a culture as poor as it seems with the EFL, I can't imagine that they can oversee the activities of 72 clubs that closely. 

[Red-Robbo]

It's not often I say this, but it's great we have so many accountants here!  

This thread is extremely interesting reading. (And no, I'm not being sarky)

[downendcity]

39 minutes ago, Coppello said:

Yeah, it wasn't exactly groundbreaking stuff but he did say quite a few things which did make me think. I agree with your point in terms of failing the PL FFP requirements, it is bloody hard to do. At the same time, they're marking you pretty tightly and query many of the numbers that go into your forecast. At the club I work at, the PL contact us with queries each week despite there being significant headroom. With a culture as poor as it seems with the EFL, I can't imagine that they can oversee the activities of 72 clubs that closely. 

It would help if they could manage 1 or 2 !

[Drew Peacock]

8 minutes ago, Red-Robbo said:

It's not often I say this, but it's great we have so many accountants here!  

This thread is extremely interesting reading. (And no, I'm not being sarky)

I find it quite depressing! 

Not about the number of accountants, I am one and we are a great bunch when you get to know us.  But Coppello's comments about the EFL's audit of the clubs accounts is a really depressing aspect of the EFLs governance, or rather lack of governance.  I know from practical experience how easy it can be to stretch matters when the audit comes along and practice the dark arts of creative accounting, but when you have a governing body giving you a nod and a wink to bend the rules - then what's the bloody point of FFP.  The recent audit scandals have shown how lax even professional audit firms can be, let alone a bunch of incompetent amateurs.

The only things that do give me hope are the number of articles that pop up about FFP such as the Times one above and the waves that Gibson (and presumably SL) are causing.  It is becoming more high profile and clearly there is unrest; the dam holding back implementing FFP hasn't broken yet, but I think the cracks are appearing.

[Mr Popodopolous]

32 minutes ago, Drew Peacock said:

I find it quite depressing! 

Not about the number of accountants, I am one and we are a great bunch when you get to know us.  But Coppello's comments about the EFL's audit of the clubs accounts is a really depressing aspect of the EFLs governance, or rather lack of governance.  I know from practical experience how easy it can be to stretch matters when the audit comes along and practice the dark arts of creative accounting, but when you have a governing body giving you a nod and a wink to bend the rules - then what's the bloody point of FFP.  The recent audit scandals have shown how lax even professional audit firms can be, let alone a bunch of incompetent amateurs.

The only things that do give me hope are the number of articles that pop up about FFP such as the Times one above and the waves that Gibson (and presumably SL) are causing.  It is becoming more high profile and clearly there is unrest; the dam holding back implementing FFP hasn't broken yet, but I think the cracks are appearing.

Think Nottingham Forest would also be pretty hacked off at this being let slide, even Birmingham now from sinners to sinned against in terms of double standards. Then any number of small to medium clubs at this level who absolutely do the right thing.  Leeds too maybe, they usually produce player sales or profit on. Mixture of gross incompetence- and I mean disgracefully so- and letting all but the stupidest or worst breaches slide- appalling.

This could I think be easily voted for- perhaps Gibson went about certain aspects wrong but proper and full enforcement without tricks that take the piss, all treated without fear or favour and rules being adhered to but with each case also judged depending on efforts to comply- e.g. if new owners try to clean house through player sales or even existing owners but there are lots of players out of favour but on good wages that can be a mitigating favour.

To me the rules are quite right, the big problem is the EFL- always thought that enforcement a problem when overseen by the EFL and it seems my fears (and those of many others) are being realised.

Theoretically, would it be too late to void Aston Villa's result especially and maybe depending on precise numbers Derby's and have a Leeds-WBA playoff final? In order for both to feel the full consequences of their actions!

Edited May 17, 2019 by Mr Popodopolous

[CyderInACan]

1 hour ago, Red-Robbo said:

This thread is extremely interesting reading. (And no, I'm not being sarky)

Agreed. One of the best ongoing threads there is. 

[bcfc01]

https://www.bristolpost.co.uk/sport/football/football-news/sheffield-wednesday-reportedly-sell-hillsborough-2880521

'ere we go...

 

[Mr Popodopolous]

The EFL HAVE to close that loophole before Aston Villa can get cracking on that- before the playoff final basically. At minimum they have to make any inflated profit from a related party illegitimate in, struck from FFP submissions.

The fact Sheffield Wednesday have a) Delayed their accounts for 2 months i.e. extended reporting period b) Still haven't submitted their revised reporting period accounts and c) If the Times article to be believed, still not submitted accounts that were due in December 2018 to EFL, means that they should have a summer window embargo- well IMO anyway- as a total minimum. I'm talking the weakest punishment.

In reality they should have closed it early before anyone could- now it may sound like being wise after the event but they are the Governing body who see accounts...should've been closed in 2016 or 2017 at the latest. Mind you, with the state of play as described by @Coppello what hope is there!!

Three sets of scummy cheats- Aston Villa, Derby and now seemingly Sheffield Wednesday- hope for the worst for all 3 of you, decent fans from Sheffield Wednesday on here notwithstanding. Okay the only possible saving grace for Sheffield Wednesday, on the ground thing is if they sold it to an external party and I mean a truly external party, not a related "external party". Other than that, yeah cheating scumbags!

Edited May 17, 2019 by Mr Popodopolous

[downendcity]

1 hour ago, Drew Peacock said:

I find it quite depressing! 

Not about the number of accountants, I am one and we are a great bunch when you get to know us.  But Coppello's comments about the EFL's audit of the clubs accounts is a really depressing aspect of the EFLs governance, or rather lack of governance.  I know from practical experience how easy it can be to stretch matters when the audit comes along and practice the dark arts of creative accounting, but when you have a governing body giving you a nod and a wink to bend the rules - then what's the bloody point of FFP.  The recent audit scandals have shown how lax even professional audit firms can be, let alone a bunch of incompetent amateurs.

The only things that do give me hope are the number of articles that pop up about FFP such as the Times one above and the waves that Gibson (and presumably SL) are causing.  It is becoming more high profile and clearly there is unrest; the dam holding back implementing FFP hasn't broken yet, but I think the cracks are appearing.

 Posting on here, while interesting interesting, merely makes me ( and many others Im sure) more frustrated and angry at the amateurish ineptitude that the EFL appear to  be demonstrating and will change nothing.

I was thinking that perhaps Copello would do better by forwarding  his comments to SL or Steve Gibson, as it needs someone with some clout in the game, and the will to take on the powers that be, if ffp is to be properly enforced and actioned  rather than remain the set of hollow words it seems to be just now. 

[downendcity]

47 minutes ago, Mr Popodopolous said:

The EFL HAVE to close that loophole before Aston Villa can get cracking on that- before the playoff final basically. At minimum they have to make any inflated profit from a related party illegitimate in, struck from FFP submissions.

The fact Sheffield Wednesday have a) Delayed their accounts for 2 months i.e. extended reporting period b) Still haven't submitted their revised reporting period accounts and c) If the Times article to be believed, still not submitted accounts that were due in December 2018 to EFL, means that they should have a summer window embargo- well IMO anyway- as a total minimum. I'm talking the weakest punishment.

In reality they should have closed it early before anyone could- now it may sound like being wise after the event but they are the Governing body who see accounts...should've been closed in 2016 or 2017 at the latest. Mind you, with the state of play as described by @Coppello what hope is there!!

Three sets of scummy cheats- Aston Villa, Derby and now seemingly Sheffield Wednesday- hope for the worst for all 3 of you, decent fans from Sheffield Wednesday on here notwithstanding. Okay the only possible saving grace for Sheffield Wednesday, on the ground thing is if they sold it to an external party and I mean a truly external party, not a related "external party". Other than that, yeah cheating scumbags!

Don't know if you, or any other posters know, who handles the administration and policing of the EFL ffp rules. Do they have accountants or professional financial experts or is it members of the "blue blazer" brigade. 

At the momnent it reminds me of a 2 Ronnies news story about the Irish Police rushing to a bank in Dublin while a raid was in progress. They sealed all the exits, but the robbers escaped through the entrances.

Clubs appear to be running rings around them and one step ahead of EFL's compliance. They are making the EFL look naive at best, inept at worst. 

 

 

[Mr Popodopolous]

Have to say, reading the Sheffield Wednesday forum many- not all, some are saying it'd lead to more problems down the line, some are saying profit won't be counted, but many are predictably moaning and predictably declaring "It's not our fault it's the regulations- blame the regulations".

Now the regulations are not perfect, but they are (by which I mean the posters) dead wong It's your- by which I mean obviously their- fault for good, but over time it became average recruitment, little thought about sell on value and wanting to buy your way out of issues. Your- or rather your owners fault- take responsibility!! I'd like to see a summer embargo at the least on them in order to ensure they cannot benefit immediately from any upturn brought about by this- with pressure still to comply so they'd have little choice but to sell one or 2 decent players as well.

I know they are popular on here but they've drifted right down in my estimation recent months.

@downendcity I'd like to think a professional body would have professional experts even if only a few to scrutinise these types of cases especially- the worst cases-  but with this bunch...

Coppello would probably be best placed to answer this one.

Edited May 17, 2019 by Mr Popodopolous

[downendcity]

1 hour ago, Mr Popodopolous said:

Have to say, reading the Sheffield Wednesday forum many- not all, some are saying it'd lead to more problems down the line, some are saying profit won't be counted, but many are predictably moaning and predictably declaring "It's not our fault it's the regulations- blame the regulations".

Now the regulations are not perfect, but they are (by which I mean the posters) dead wong It's your- by which I mean obviously their- fault for good, but over time it became average recruitment, little thought about sell on value and wanting to buy your way out of issues. Your- or rather your owners fault- take responsibility!! I'd like to see a summer embargo at the least on them in order to ensure they cannot benefit immediately from any upturn brought about by this- with pressure still to comply so they'd have little choice but to sell one or 2 decent players as well.

I know they are popular on here but they've drifted right down in my estimation recent months.

@downendcity I'd like to think a professional body would have professional experts even if only a few to scrutinise these types of cases especially- the worst cases-  but with this bunch...

Coppello would probably be best placed to answer this one.

If they are then they are bringing their profession into disrepute.

 

[Drew Peacock]

24 minutes ago, downendcity said:

If they are then they are bringing their profession into disrepute.

 

Like Grant Thornton at Patisserie Valerie, KPMG at Carillion, PWC at BT, Deloitte at Mitie and PWC at BHS..........

In fact KPMG have a string of audit failures to their name.  If the big accountancy firms can't get it right, then what chance the EFL?

[Coppello]

1 hour ago, Mr Popodopolous said:

Have to say, reading the Sheffield Wednesday forum many- not all, some are saying it'd lead to more problems down the line, some are saying profit won't be counted, but many are predictably moaning and predictably declaring "It's not our fault it's the regulations- blame the regulations".

Now the regulations are not perfect, but they are (by which I mean the posters) dead wong It's your- by which I mean obviously their- fault for good, but over time it became average recruitment, little thought about sell on value and wanting to buy your way out of issues. Your- or rather your owners fault- take responsibility!! I'd like to see a summer embargo at the least on them in order to ensure they cannot benefit immediately from any upturn brought about by this- with pressure still to comply so they'd have little choice but to sell one or 2 decent players as well.

I know they are popular on here but they've drifted right down in my estimation recent months.

@downendcity I'd like to think a professional body would have professional experts even if only a few to scrutinise these types of cases especially- the worst cases-  but with this bunch...

Coppello would probably be best placed to answer this one.

@Downend City The EFL have their own accountants which monitor and scrutinise the FFP submissions of clubs.

Part of it is based on the financial statements which are audited by an external accounting firm and should provide assurance that they meet the relevant accounting standards. However, there are several deductions made to the accounts to make them more in line with the FFP requirements and the auditors will not look at this as they’re looking at them from a completely legal view. 

The figures reported in the accounts, less the deductions, will then be scrutinised by the EFL’s accountants. They will have limited information on how the deducted items have been made up, for example they have limited oversight over the total academy spend, the deductions for women’s football, community spend etc. which makes their job a little harder.

However, the most contentious piece of the reporting is the forecasts submitted for the upcoming year(s). The auditors will not review these and therefore the whole review is performed by the EFL and this is where the scope for creative accounting increases significantly. In the Premier League, the forecasts are heavily scrutinised and if you report significant profits from player trading, they threaten to hold your hand through the transfer window.

 

[Mr Popodopolous]

7 minutes ago, Coppello said:

 @Downend City The EFL have their own accountants which monitor and scrutinise the FFP submissions of clubs.

 Part of it is based on the financial statements which are audited by an external accounting firm and should provide assurance that they meet the relevant accounting standards. However, there are several deductions made to the accounts to make them more in line with the FFP requirements and the auditors will not look at this as they’re looking at them from a completely legal view. 

The figures reported in the accounts, less the deductions, will then be scrutinised by the EFL’s accountants. They will have limited information on how the deducted items have been made up, for example they have limited oversight over the total academy spend, the deductions for women’s football, community spend etc. which makes their job a little harder.

 However, the most contentious piece of the reporting is the forecasts submitted for the upcoming year(s). The auditors will not review these and therefore the whole review is performed by the EFL and this is where the scope for creative accounting increases significantly. In the Premier League, the forecasts are heavily scrutinised and if you report significant profits from player trading, they threaten to hold your hand through the transfer window.

  

Very interesting stuff, this insight you are providing. Sounds like the promise of future transfers to make up shortfalls needs real oversight...my solution and it's purely theoretical would therefore be an embargo for any club that 'stretches the truth' on it, until such a time as the deficit is cleared or the obligation is fulfilled.

One question I would have, as the rules stand, in your opinion is it possible to strike from the record  the profit on transactions to related parties, or is that stable door and horses bolting? E.g. Derby FFP submissions would show £40m instead of £80m on 'sale' of Pride Park.

Edited May 17, 2019 by Mr Popodopolous

[Davefevs]

1 minute ago, Mr Popodopolous said:

Very interesting stuff, this insight you are providing.

One question I would have, as the rules stand, in your opinion is it possible to strike from the record  the profit on transactions to related parties, or is that stable door and horses bolting? E.g. Derby FFP submissions would show £40m instead of £80m on 'sale' of Pride Park.

Surely if the submission was wrong, there must be an option to adjust.

[Mr Popodopolous]

18 minutes ago, Davefevs said:

Surely if the submission was wrong, there must be an option to adjust.

I'm surprised it doesn't have implications for tax purposes, HMRC, the Revenue etc as well- but then I'm not a tax specialist! How can an asset just shoot up in value like that, it's nuts.

In fact, the Derby accounts from 2016/17, says the following- my take is that a £40m may have been generous but let's assume it is fairish value. Anyway though...below.

Bottom of P.22.

Quote

 

"The freehold buildings with a historical cost of £20,852,867 known as the Pride Park Stadium were valued by independent valuers Jones Lang LaSalle on 23 May 2013. The valuation was prepared on a depreciated replacement cost basis and was made in accordance with the Royal Institution of Chartered Surveyors Asset Statements of Valuation Practice and Guidance Notes. Based on this valuation the directors have assessed that the carrying value of the freehold buildings and determined that the current value is appropriate"

 

We're therefore expected to believe that it was undervalued by 50% in 2013, that it had somehow doubled and doubled again by 2017/18. Now it may- I don't know the ins and outs- but it may have had refurbishment done, corporate facilities on and off matchdays etc upgraded- I can accept that a valuation of £40m might- and I mean might- be possible if stretching it a bit. £80m though?? That's before even factoring in depreciation in the 4-5 years since this took place!

Edited May 17, 2019 by Mr Popodopolous

[Davefevs]

9 minutes ago, Mr Popodopolous said:

I'm surprised it doesn't have implications for tax purposes, HMRC, the Revenue etc as well- but then I'm not a tax specialist! How can an asset just shoot up in value like that, it's nuts.

In fact, the Derby accounts from 2016/17, says the following- my take is that a £40m may have been generous but let's assume it is fairish value. Anyway though...below.

Bottom of P.22.

We're therefore expected to believe that it was undervalued by 50% in 2013, that it had somehow doubled and doubled again by 2017/18. Now it may- I don't know the ins and outs- but it may have had refurbishment done, corporate facilities on and off matchdays etc upgraded- I can accept that a valuation of £40m might- and I mean might- be possible if stretching it a bit. £80m though?? That's before even factoring in depreciation in the 4-5 years since this took place!

You have just answered the question the EFL guys should’ve been asking!  It’s been hideously over-valued to make Derby stay within FFP.

[Guest]

38 minutes ago, Drew Peacock said:

Like Grant Thornton at Patisserie Valerie, KPMG at Carillion, PWC at BT, Deloitte at Mitie and PWC at BHS..........

In fact KPMG have a string of audit failures to their name.  If the big accountancy firms can't get it right, then what chance the EFL?

Totally agree. And actually; given his dual position MA is in a very, very tight spot.

Of course he’ll want BCFC to be the torch bearer for FFP with one hat on, but if I was SL I’d be asking a number of awkward questions.

Two teams are competing a play off final when it appears they’ve had a competitive advantage. Mark.... why aren’t you flying our flag? How has this happened? If he’s a director, is he failing his duty to promote the best interests of BCFC.... Gibson is going public and fair play to him, I think SL needs to flex his arms internally. 

[View from the Dolman]

So looking at the Derby County stadium ownership... The freehold of DY342736 was transferred to GELLAW NEWCO 202 LIMITED (registered 19th June 2018) and registered on 30th July 2018. GELLAW NEWCO 202 LIMITED was incorporated with GELLAW NEWCO 201 LIMITED (registered  18th June 2018) holding the only share in the company. GELLAW NEWCO 201 appointed its liquidators 10 days after its incorporation in a members voluntary liquidation on 28th June 2018.

If it looks like a duck, quacks like a duck...

[Guest]

34 minutes ago, View from the Dolman said:

So looking at the Derby County stadium ownership... The freehold of DY342736 was transferred to GELLAW NEWCO 202 LIMITED (registered 19th June 2018) and registered on 30th July 2018. GELLAW NEWCO 202 LIMITED was incorporated with GELLAW NEWCO 201 LIMITED (registered  18th June 2018) holding the only share in the company. GELLAW NEWCO 201 appointed its liquidators 10 days after its incorporation in a members voluntary liquidation on 28th June 2018.

If it looks like a duck, quacks like a duck...

The ‘smell test’. Stinks of Shit. That’s not even clever. It is as overt as it could be. They probably went to the lowest grade advisors for that. 

The saving grace is in having such a blatant back-to-back and insta-collapse deal, they didn’t try so hard on the structure so they’ve may have had ‘on the cheap’ tax advice and triggered a big bill for someone along the way.  

Edited May 17, 2019 by Guest

[downendcity]

8 minutes ago, 29AR said:

The ‘smell test’. Stinks of Shit. That’s not even clever. It is as overt as it could be. They probably went to the lowest grade advisors for that. 

The saving grace is in having such a blatant back-to-back and insta-collapse deal, they didn’t try so hard on the structure so they’ve may have had ‘on the cheap’ tax advice and triggered a big bill for someone along the way.  

 

38 minutes ago, View from the Dolman said:

So looking at the Derby County stadium ownership... The freehold of DY342736 was transferred to GELLAW NEWCO 202 LIMITED (registered 19th June 2018) and registered on 30th July 2018. GELLAW NEWCO 202 LIMITED was incorporated with GELLAW NEWCO 201 LIMITED (registered  18th June 2018) holding the only share in the company. GELLAW NEWCO 201 appointed its liquidators 10 days after its incorporation in a members voluntary liquidation on 28th June 2018.

If it looks like a duck, quacks like a duck...

Makes you wonder what the EFL financial compliance team are doing if a few guys on a football club forum can get together a bunch of information that throws into question the validity of certain clubs' meeting ffp requirements.

[Guest]

3 hours ago, downendcity said:

 

Makes you wonder what the EFL financial compliance team are doing if a few guys on a football club forum can get together a bunch of information that throws into question the validity of certain clubs' meeting ffp requirements.

And that’s why Ashton is a weird one. He’s an EFL board member. He’s also a director of Bristol City Football Club Limited. He has a statutory duty to promote the success of BCFC under the companies act 2006. 

On the presumption blind eyes have been turned or incompetence has been shown within the EFL, whilst BCFC have ensured they have complied: he might need to  consider how much of a fuss he’s been kicking up within the EFL and whether he’s kicked up enough to satisfy his obligation to BCFC to promote its best interests. 

 

Edited May 17, 2019 by Guest

[Coppello]

14 hours ago, Mr Popodopolous said:

Very interesting stuff, this insight you are providing. Sounds like the promise of future transfers to make up shortfalls needs real oversight...my solution and it's purely theoretical would therefore be an embargo for any club that 'stretches the truth' on it, until such a time as the deficit is cleared or the obligation is fulfilled.

One question I would have, as the rules stand, in your opinion is it possible to strike from the record  the profit on transactions to related parties, or is that stable door and horses bolting? E.g. Derby FFP submissions would show £40m instead of £80m on 'sale' of Pride Park.

Applying accounting rules, profit on transactions with related parties should be at an arms length. Given that they’ve had an independent valuation, who have determined that the fair value of Pride Park is £80m (which is farcical), they’ve technically worked within the rules. 

The problem is that transactions with related parties can be genuine and it can’t always be genuine. For example, we can the rugby club rent for the use of Ashton Gate in the accounts of the stadium. We’ve actually charged rent at an arms length and it’s fair for them to pay for the use of the stadium. 

What they’ve done is the financial equivalent of scoring a goal when a player is down injured; there’s no rules against it but it’s unethical. Unless the EFL enforce a change in rules, the same thing will continue to happen. Legally, I don’t think the EFL can ask them to strike it off this years accounts. 

What I think they can do is scrutinise the accounts and appoint a surveyor to conduct another valuation. I have absolutely no idea how they can reach £80m for a 20 year old stadium built on a converted rubbish tip in Derbyshire. 

[downendcity]

1 hour ago, Coppello said:

Applying accounting rules, profit on transactions with related parties should be at an arms length. Given that they’ve had an independent valuation, who have determined that the fair value of Pride Park is £80m (which is farcical), they’ve technically worked within the rules. 

The problem is that transactions with related parties can be genuine and it can’t always be genuine. For example, we can the rugby club rent for the use of Ashton Gate in the accounts of the stadium. We’ve actually charged rent at an arms length and it’s fair for them to pay for the use of the stadium. 

What they’ve done is the financial equivalent of scoring a goal when a player is down injured; there’s no rules against it but it’s unethical. Unless the EFL enforce a change in rules, the same thing will continue to happen. Legally, I don’t think the EFL can ask them to strike it off this years accounts. 

What I think they can do is scrutinise the accounts and appoint a surveyor to conduct another valuation. I have absolutely no idea how they can reach £80m for a 20 year old stadium built on a converted rubbish tip in Derbyshire. 

For some of the Estate Agents I've known and dealt with in my time, that sounds quite reasonable!

Re. transactions with related parties. Im sure that UEFA have a specialist team that evaluate things like stadium naming rights and sponsorship deals to ensure they are at "fair value". Didn't they look at Man City's stadium naming rights because it was paid for by another of their owners related companies?

The more Im reading from people like you, the more it sounds to me like the EFL came up with the new set of rules and punishment, but are effectively working out how to apply them on the hoof i.e. making it up as they go along. They seem to have (naively) relied on club's playing by the rules, which is all well and good if all clubs toe the line. Unfortunately with the rewards for promotion to the prem being so great, and with some clubs being so financially stretched, and therefore desperate for promotion, there will always be some that will be prepared to take the risk and especially if they have a good idea that the EFL will be weak in pursuing them. 

It would be interesting to hear the Derby owner's justification for selling the ground to another of his companies and the timing thereof but doubt if this sort of question would be raised by the EFL.

P.S. I'm not an accountant or tax expert. I don't think capital gains tax applies to companies, so presumably the £80m will go into the income column and will increase the vendor company's profits  which will be taxed at corporation tax rate? If so then it is the equivalent of a fine , which is preferable to a points deduction for breaching ffp!

 

[Mr Popodopolous]

1 hour ago, Coppello said:

Applying accounting rules, profit on transactions with related parties should be at an arms length. Given that they’ve had an independent valuation, who have determined that the fair value of Pride Park is £80m (which is farcical), they’ve technically worked within the rules. 

The problem is that transactions with related parties can be genuine and it can’t always be genuine. For example, we can the rugby club rent for the use of Ashton Gate in the accounts of the stadium. We’ve actually charged rent at an arms length and it’s fair for them to pay for the use of the stadium. 

What they’ve done is the financial equivalent of scoring a goal when a player is down injured; there’s no rules against it but it’s unethical. Unless the EFL enforce a change in rules, the same thing will continue to happen. Legally, I don’t think the EFL can ask them to strike it off this years accounts. 

What I think they can do is scrutinise the accounts and appoint a surveyor to conduct another valuation. I have absolutely no idea how they can reach £80m for a 20 year old stadium built on a converted rubbish tip in Derbyshire. 

Thank you for the responses.

Arms length responses can be legitimate and genuine agreed. This one strikes me as not- or for want of a better phrase, taking the piss.

I think somewhere between £20-40m about right- the latter the maximum. Weird to see how it doubled- and doubled again- since 2013 however! Maybe there was improvement work and it was undervalued so £40m maybe...but not likely. Anything over and above? Grossly overvalued IMO.

Wonder if EFL did that. If the independent surveyor found it was grossly overvalued, could the profit then be struck from the FFP calculations, or is it now too late?

[Mr Popodopolous]

36 minutes ago, downendcity said:

For some of the Estate Agents I've known and dealt with in my time, that sounds quite reasonable!

Re. transactions with related parties. Im sure that UEFA have a specialist team that evaluate things like stadium naming rights and sponsorship deals to ensure they are at "fair value". Didn't they look at Man City's stadium naming rights because it was paid for by another of their owners related companies?

The more Im reading from people like you, the more it sounds to me like the EFL came up with the new set of rules and punishment, but are effectively working out how to apply them on the hoof i.e. making it up as they go along. They seem to have (naively) relied on club's playing by the rules, which is all well and good if all clubs toe the line. Unfortunately with the rewards for promotion to the prem being so great, and with some clubs being so financially stretched, and therefore desperate for promotion, there will always be some that will be prepared to take the risk and especially if they have a good idea that the EFL will be weak in pursuing them. 

It would be interesting to hear the Derby owner's justification for selling the ground to another of his companies and the timing thereof but doubt if this sort of question would be raised by the EFL.

P.S. I'm not an accountant or tax expert. I don't think capital gains tax applies to companies, so presumably the £80m will go into the income column and will increase the vendor company's profits  which will be taxed at corporation tax rate? If so then it is the equivalent of a fine , which is preferable to a points deduction for breaching ffp!

 

Agreed on what you say- EFL seem to be working it our far too slowly- these rules were in place the new 3 year ones since 2015/16. Yet they only deigned to announce points deductions in September 2018, even that could've been leaked to the Times- in the early stages of Birmingham's eventual punishment.

Plus announced a proper range, tariff, only after the Birmingham deduction- this should have been put out there in 2016/17 surely.

Alas on the tax thing, think tax liabilities can be offset against trading losses. Their accounts said £0 tax.

Because like many clubs, they post losses- so paid no tax so far as I can see. Plus for FFP tax isn't counted- believe it's the profit/loss before tax that is used.

[Grey Fox]

On 17/05/2019 at 13:27, hodge said:

So basically Lansdown to just buy AG from whichever company owns the stadium for £100m and see if the EFL have any balls 

Why just the ground, what is to stop an owner adding to his souvenier colllection and buying a club ashtray for £m,s if he wanted to?

Edited May 18, 2019 by Grey Fox
Came out wrong

[Drew Peacock]

1 hour ago, Mr Popodopolous said:

 

Alas on the tax thing, think tax liabilities can be offset against trading losses. Their accounts said £0 tax.

Because like many clubs, they post losses- so paid no tax so far as I can see. Plus for FFP tax isn't counted- believe it's the profit/loss before tax that is used.

It will probably be a group tax computation so it will all net out.

[Mr Popodopolous]

43 minutes ago, Grey Fox said:

Why just the ground, what is to stop an owner adding to his souvenier colllection and buying a club ashtray for £m,s if he wanted to?

Dunno how serious this post of yours is but anyway Related party, arms length transaction rules. Or have I been WHOOSHED! 

On a serious note, we could boost commercial revenue and stay within the rules as I think we will- you maybe don't something.

Make sure it's cleared with EFL etc but we could get each stand sponsored by a related party perhaps provided it's within market rates.

The HL stand, the company he has invested in - Sustainable Energy Technology Investments Ltd for another, maybe if he's got any business interests in Botswana- if it's within accepted market rates I don't see an issue..

Have the training ground sponsored too- again stick strictly to market rates.

[Drew Peacock]

53 minutes ago, Drew Peacock said:

It will probably be a group tax computation so it will all net out.

Thinking about it, it must be a sale external to the Football group, otherwise it would just be an internal transfer, so although I haven't done CT for a while, I think the profit will be offset against this year's loss and then use up the accumulated losses brought forward.  Unlikely to be a big tax bill if anything at all.

 

[Mr Popodopolous]

22 minutes ago, Drew Peacock said:

Thinking about it, it must be a sale external to the Football group, otherwise it would just be an internal transfer, so although I haven't done CT for a while, I think the profit will be offset against this year's loss and then use up the accumulated losses brought forward.  Unlikely to be a big tax bill if anything at all.

 

FWIW, dunno if they backdated the transaction or what, but it said on their accounts for 2017/18 tax bill £0. Checked it a bit earlier- plausible to offset against prior losses?

In an FFP context, taxation doesn't seem to be a factor anyway from what I can tell.

Edited May 18, 2019 by Mr Popodopolous

[downendcity]

3 minutes ago, Mr Popodopolous said:

FWIW, dunno if they backdated the transaction or what, but it said on their accounts for 2017/18 tax bill £0. Checked it a bit earlier- plausible to offset against prior losses?

In an FFP context, taxation doesn't seem to be a factor anyway from what I can tell.

In an FFP context, diddlin' and fiddlin' don't seem to be factors either. 

[Mr Popodopolous]

11 minutes ago, downendcity said:

In an FFP context, diddlin' and fiddlin' don't seem to be factors either. 

Partly what Coppello said, partly what you said about still working it out, partly what I said about gross incompetence- those 3 cover it!

I think the reason for tax is okay- because say s club makes a pretax loss of x but gets a tax rebate of some sort, past losses etc can help bring it about for companies I believe, maybe that law has changed but I'm sure I remember seeing a clubs accounts which had losses then those losses reduced by tax credit.

That could be a difference between passing and failing FFP so to cover all bases it's probably for the best.

[Mr Popodopolous]

As regular readers of this thread will know, Kieran Maguire has tracked differentials between Derby accounts and their holding Company Sevco 5112.

Noticed it when looking at his Twitter for something else- credit to him.

However I noticed there's nothing- unless he's accounted for it in a different way in his figures- about Depreciation on there, or indeed amortisation of Intangible assets which don't include football. Comes to about £9.09m, but that is still £3.11m (roughly) over the limit. Dunno how many points off that would be but it would surely have meant Middlesbrough in 6th rather than us- would have to find the points to overspend tariff and see. Now I don't know it could be the case that Infrastructure covers depreciation etc.

Found it!

Without the ground thing, going by this- assuming my amortisation isn't me double counting somehow, then it would likely have been 4 points plus deemed an intentional breach so 7 in total- but one given back if like Birmingham they admitted to it. 

 If it is/was me double counting then 9 points plus the aforementioned 3 for a breach- plus of course one given back for admitting which we assume they would. Regardless we may not have made the playoffs- that may have been Middlesbrough- but we would have finished above them. That's before we even get into the cop out of failure to implement projected accounts.

Edited May 18, 2019 by Mr Popodopolous

[Mr Popodopolous]

I was looking back at this thread, around February, March time- and the EFL have literally not enforced their own rules- projected accounts in particular. They have simply neglected to enforce these, in particular against likely offending clubs. Derby's ground thing may have got them off the hook though.

We and Middlesbrough to name 2 compliant clubs have missed out on a legitimate shot at promotion via the playoffs. Any scope for legal actions against EFL/offending clubs?

Edited May 18, 2019 by Mr Popodopolous

[Busterrimes]

14 hours ago, Mr Popodopolous said:

I was looking back at this thread, around February, March time- and the EFL have literally not enforced their own rules- projected accounts in particular. They have simply neglected to enforce these, in particular against likely offending clubs. Derby's ground thing may have got them off the hook though.

We and Middlesbrough to name 2 compliant clubs have missed out on a legitimate shot at promotion via the playoffs. Any scope for legal actions against EFL/offending clubs?

I would ay you could sue because the EFL have failed to enforce their own rules. heprecedent is that they did enforce them against Birmingham

[Mr Popodopolous]

41 minutes ago, Busterrimes said:

I would ay you could sue because the EFL have failed to enforce their own rules. heprecedent is that they did enforce them against Birmingham

It is complex- perhaps they did and they didn't.

With Birmingham, they enforced the period of 2015/16-2017/18. This was the period of 3 seasons prior to this season.

The regulations/rules to which I am referring are the projected accounts. The Derby example I gave would have been the prior period as per Birmingham, but I am referring to the in-season accounts.

These were quoted directly in this thread. The point of them was to prevent clubs from wriggling out of their obligations- possibly even quoted directly from EFL website but will look into that later.

In terms of any hypothetical lawsuit. Us and Middlesbrough for a start would be eligible in terms of a directly affected wronged party. So too might Leeds and WBA- both stuck to the rules and yet lost to sides who appear to have disregarded them.

Then I would add Barnsley and Burton- both 2017/18 season, but both well within both finished level on points, Birmingham should've been docked points that season as that was the period their breach occurred in- should have been relegated.

Then you have sides like us and Middlesbrough, Leeds, Nottingham Forest- hell even Swansea who have all sold to help stay in line. Hull another.

Though tbh, Hull and Swansea smack of asset stripping. Norwich too but that cash flow and solvency as much as anything. Sheffield United too- Brooks sale- neither solvency or cashflow but trading and compliance purposes.

With the exception of Derby- who tbh sold 5 first teamers and 1 squad player, the other 2 big unpunished clubs have made no effort to comply.

Can't see the serious efforts by Aston Villa or Sheffield Wednesday. Birmingham still have hold of Adams and Jota to name 2.

If you don't enforce own rules such as these in a timely manner, it seriously distorts the competition.

Will go through examples of clubs who sold to help comply in due course.

Edited May 19, 2019 by Mr Popodopolous

[Davefevs]

That has been my point on this for a good while.  I really hoped the projected accounts would make a difference to previous wrongdoings.  Of course perhaps Villa included the forecast sale of Grealish?  I don’t know.  @Coppello - would that be allowed?

[Coppello]

17 hours ago, Davefevs said:

That has been my point on this for a good while.  I really hoped the projected accounts would make a difference to previous wrongdoings.  Of course perhaps Villa included the forecast sale of Grealish?  I don’t know.  @Coppello - would that be allowed?

I'm not 100% clear on the EFL rules for this but it would be allowed in the Premier League. I've also been a bit nervous about Villa forecasting this as it will allow them to write off a substantial amount of any loss. 

[Mr Popodopolous]

Excellent comment I saw from what I assume to be a Birmingham fan on a Guardian comment- media have been pretty pathetic, as per- but that is exactly the questions media should be asking.

Quote

 

Paul, given you are a journalist, could you do me a favour, and ask the League the following?

1. When did they find out Derby had sold their ground to their owner?
2. What checks did they make over the value Derby had given to it before?
3. When did they find out the level of rent?
4. Whom did the League ask as to whether that was a commercial level?
5. Whom did the League ask as to a proper commercial value for Pride Park?
6. What checks did they undertake as to compliance with their own regulations as to investment by a connected party?

Just wondering.

 

 

[Mr Popodopolous]

35 minutes ago, Coppello said:

I'm not 100% clear on the EFL rules for this but it would be allowed in the Premier League. I've also been a bit nervous about Villa forecasting this as it will allow them to write off a substantial amount of any loss. 

It would for the period to 2018/19 season yeah, but if they stayed down they would have a major hole still IMO. A question as to whether Kieran Maguire's Infrastructure figures included depreciation etc as part of it, if they did that takes total losses down but still in breach- similar for Derby.

Also questions about whether they are getting a lot of HS2 compensation- saw one below the line comment on an article of £15m! No idea on that though- but a former Aston Villa chairman is in HS2 committee or similar in that region!?

http://www.railtechnologymagazine.com/Rail-News/former-aston-villa-chair-announced-as-wmca-hs2-growth-delivery-chair

Given Aston Villa are or maybe were due some compensation, it's an unbelievable conflict of interest, or has that potential at least- but then is anyone surprised anymore?

Edited May 20, 2019 by Mr Popodopolous

[downendcity]

18 hours ago, Davefevs said:

That has been my point on this for a good while.  I really hoped the projected accounts would make a difference to previous wrongdoings.  Of course perhaps Villa included the forecast sale of Grealish?  I don’t know.  @Coppello - would that be allowed?

 

44 minutes ago, Coppello said:

I'm not 100% clear on the EFL rules for this but it would be allowed in the Premier League. I've also been a bit nervous about Villa forecasting this as it will allow them to write off a substantial amount of any loss. 

Talk about  a moving target!

If you are allowed to include the forecast sale of a player(s) then in theory every club could put in the forecast sale of their most valuable player to offset losses that would otherwise take them over the ffp limit. Given the EFL's diligence if said player was not subsequently sold then nothing would happen.

If they used Derby's valuer, then we could forecast the sale of Pato for £50m, be well within ffp limits and could afford to buy Harry Kane!

Anyone else getting the impression that the ffp rules are not worth the paper on which they are written?

[Mr Popodopolous]

14 minutes ago, downendcity said:

 

Talk about  a moving target!

If you are allowed to include the forecast sale of a player(s) then in theory every club could put in the forecast sale of their most valuable player to offset losses that would otherwise take them over the ffp limit. Given the EFL's diligence if said player was not subsequently sold then nothing would happen.

If they used Derby's valuer, then we could forecast the sale of Pato for £50m, be well within ffp limits and could afford to buy Harry Kane!

Anyone else getting the impression that the ffp rules are not worth the paper on which they are written?

I think if enforced by UEFA (or us on here  )instead of EFL, we would have seen harsher and swifter punishments- the fact they i.e. UEFA are pushing for a Man City ban from CL is belated but finally- they have been trying to reopen the PSG investigation too, post Football Leaks.

Same could go for EPL, but then the limit is set at such a level that combined with TV money and allowable write offs it is almost impossible to fail (STCC a different matter)- funny that! 

Edited May 20, 2019 by Mr Popodopolous

[Davefevs]

10 minutes ago, downendcity said:

 

Talk about  a moving target!

If you are allowed to include the forecast sale of a player(s) then in theory every club could put in the forecast sale of their most valuable player to offset losses that would otherwise take them over the ffp limit. Given the EFL's diligence if said player was not subsequently sold then nothing would happen.

If they used Derby's valuer, then we could forecast the sale of Pato for £50m, be well within ffp limits and could afford to buy Harry Kane!

Anyone else getting the impression that the ffp rules are not worth the paper on which they are written?

That was pretty much my point a few weeks ago. 

If Villa gave included a forecast sale of Grealish, then they should be bound by it imho. If they don’t sale (because they’ve gone up) then in effect there losses are bigger and they should be denied promotion. 

[Mr Popodopolous]

13 minutes ago, Davefevs said:

That was pretty much my point a few weeks ago. 

 If Villa gave included a forecast sale of Grealish, then they should be bound by it imho. If they don’t sale (because they’ve gone up) then in effect there losses are bigger and they should be denied promotion. 

If they actually have a hard and fast deal in place to sell though- that is possible, then that would be somewhat more legit? I very much doubt they do, but look how quickly the Kelly transfer happened- this can be possible. As in, he goes regardless.

Agree, denial of promotion the only way- unsure how it would work though- replay the playoffs but with places shifting around- ie Leeds 3rd, WBA 4th, Derby 5th and Middlesbrough 6th? Award the final to Derby by default- maybe Leeds as the highest team who didn't go up automatically, but seemingly actually did comply with FFP?

Edited May 20, 2019 by Mr Popodopolous

[downendcity]

7 minutes ago, Davefevs said:

That was pretty much my point a few weeks ago. 

If Villa gave included a forecast sale of Grealish, then they should be bound by it imho. If they don’t sale (because they’ve gone up) then in effect there losses are bigger and they should be denied promotion. 

It's because of this that I cannot see how a forecast sale can be included in the accounts for ffp.

There seems to be an issue when a club has a financial year end falling in the summer, i.e. after the transfer window opens, as they can include a forecast sale, as Vila could well have done with Grealish.

However, at a stroke, this gives those clubs an advantage over every other club whose year end is end of March or end of the tax year, as those clubs don't have he summer window into which they can forecast a player sale in the same way.

 

[downendcity]

16 minutes ago, Mr Popodopolous said:

If they actually have a hard and fast deal in place to sell though- that is possible, then that would be somewhat more legit? I very much doubt they do, but look how quickly the Kelly transfer happened- this can be possible. As in, he goes regardless.

Agree, denial of promotion the only way- unsure how it would work though- replay the playoffs but with places shifting around- ie Leeds 3rd, WBA 4th, Derby 5th and Middlesbrough 6th? Award the final to Derby by default- maybe Leeds as the highest team who didn't go up automatically, but seemingly actually did comply with FFP?

We all thought that the new rules, with projected accounts, was going to allow points deduction during the same season and thereby  deny offenders promotion.

If forecast sales are allowed, then if a club has a financial year ending in the summer ( as I guess Villa's does) , and after the transfer window opens, then it hands them an advantage( for ffp purposes) over other clubs whose year ends are end of March or the end of the tax year, for example, as those other clubs cannot project sales as they have no window available before then do father financial year.

If they are going to allow forecast sales then it seems they need to standardise the financial year ends of every club, so that no one gains an advantage. The better solution is that they don't allow forecast sales, as if a club carried out proper management accounts and controls, they should be well aware if they are in danger of breaching ffp well before the third year. If so, and they need to sell players to avoid breaching then they have a summer and winter window available to make sales and that should be more than enough!

 As you suggested, perhaps the EFL needs to appoint OTIB as it's ffp consultants and we can draw up a new set of rules that are robust, fit for purpose and can do the job for which they are designed. We could also draw up a special set of punishments for clubs we don't like and who think they have a special sense of entitlement.

[Mr Popodopolous]

2 minutes ago, downendcity said:

We all thought that the new rules, with projected accounts, was going to allow points deduction during the same season and thereby  deny offenders promotion.

If forecast sales are allowed, then if a club has a financial year ending in the summer ( as I guess Villa's does) , and after the transfer window opens, then it hands them an advantage( for ffp purposes) over other clubs whose year ends are end of March or the end of the tax year, for example, as those other clubs cannot project sales as they have no window available before then do father financial year.

 If they are going to allow forecast sales then it seems they need to standardise the financial year ends of every club, so that no one gains an advantage. The better solution is that they don't allow forecast sales, as if a club carried out proper management accounts and controls, they should be well aware if they are in danger of breaching ffp well before the third year. If so, and they need to sell players to avoid breaching then they have a summer and winter window available to make sales and that should be more than enough!

  As you suggested, perhaps the EFL needs to appoint OTIB as it's ffp consultants and we can draw up a new set of rules that are robust, fit for purpose and can do the job for which they are designed. We could also draw up a special set of punishments for clubs we don't like and who think they have a special sense of entitlement.

Agreed- but given this seems not to have happened, I don't know how it would work if say Aston Villa win the playoff final- it could in theory but who would go up in their place? Mnd you I saw Swindon mentioned on this thread in 1990- precedent??

I think most clubs financial years end at the end of May or June- and in a couple of cases, end of July- so all clubs have an opportunity to sell within time but some more than others- something needs to be standardised if possible on this- maybe accounts up to a certain cut off point- end of May? Can't say I know of any ending in March though.

Agree, forecasted sales being abolished would be best. Still the above paragraph may have some sort of scope for standardisation. 

Agreed- and especially for the entitlement brigade, love to see them taken down a peg! Think the rules are mainly alright though, it's the implementation of them that is the problem- what @Coppello wrote on Friday about his discussions with someone at the EFL was shocking!

[Drew Peacock]

3 hours ago, Mr Popodopolous said:

If they actually have a hard and fast deal in place to sell though- that is possible, then that would be somewhat more legit? I very much doubt they do, but look how quickly the Kelly transfer happened- this can be possible. As in, he goes regardless.

Agree, denial of promotion the only way- unsure how it would work though- replay the playoffs but with places shifting around- ie Leeds 3rd, WBA 4th, Derby 5th and Middlesbrough 6th? Award the final to Derby by default- maybe Leeds as the highest team who didn't go up automatically, but seemingly actually did comply with FFP?

Or relegate one less from PL

[Coppello]

3 hours ago, Mr Popodopolous said:

I think if enforced by UEFA (or us on here  )instead of EFL, we would have seen harsher and swifter punishments- the fact they i.e. UEFA are pushing for a Man City ban from CL is belated but finally- they have been trying to reopen the PSG investigation too, post Football Leaks.

Same could go for EPL, but then the limit is set at such a level that combined with TV money and allowable write offs it is almost impossible to fail (STCC a different matter)- funny that! 

One thing that you might find slightly interesting is that the UEFA have their FFP rules which are different to the Premier League (as you're aware). UEFA sets the rules and each nation has a licensing body, which is the Premier League in England. Any team that wishes to compete in a European competition has to submit a number of reports through the UEFA portal to show that they are in compliance with these rules. All clubs are encouraged to submit these documents to UEFA regardless of their league position but in reality it would only be beneficial for any clubs with a shot of getting into CL/EL in April. 

These documents are submitted through the portal but are actually detail reviewed and audited by the Premier League (or whoever the local licensing body is). If the test is passed, the club are then issued with the UEFA license. If there are any issues, such as Man City/PSG, UEFA will then step in.  

[Mr Popodopolous]

11 minutes ago, Drew Peacock said:

Or relegate one less from PL

Ha but a reprieve for Colin. Or Bryan (not too bad granted).

Would provide a fair solution though and denial of promotion the ultimate realistic punishment.

8 minutes ago, Coppello said:

One thing that you might find slightly interesting is that the UEFA have their FFP rules which are different to the Premier League (as you're aware). UEFA sets the rules and each nation has a licensing body, which is the Premier League in England. Any team that wishes to compete in a European competition has to submit a number of reports through the UEFA portal to show that they are in compliance with these rules. All clubs are encouraged to submit these documents to UEFA regardless of their league position but in reality it would only be beneficial for any clubs with a shot of getting into CL/EL in April. 

These documents are submitted through the portal but are actually detail reviewed and audited by the Premier League (or whoever the local licensing body is). If the test is passed, the club are then issued with the UEFA license. If there are any issues, such as Man City/PSG, UEFA will then step in.  

One bit I don't quite get in UEFA FFP PL limit split.

PL loss limit the aforementioned £35m plus costs. UEFA loss limit is quite a bit lower IIRC.

Which one takes precedence for obtaining a European license- UEFA I assume.

Edited May 20, 2019 by Mr Popodopolous

[Coppello]

5 minutes ago, Mr Popodopolous said:

Ha but a reprieve for Colin. Or Bryan (not too bad granted).

Would provide a fair solution though and denial of promotion the ultimate realistic punishment.

One bit I don't quite get in UEFA FFP PL limit split.

PL loss limit the aforementioned £35m plus costs. UEFA loss limit is quite a bit lower IIRC.

Which one takes precedence for obtaining a European license- UEFA I assume.

Yeah it's the UEFA rules. They're two independent codes of conduct but its just that the UEFA one is mainly administered by the PL (who have no actual say in the rules themselves). 

[Mr Popodopolous]

49 minutes ago, Coppello said:

Yeah it's the UEFA rules. They're two independent codes of conduct but its just that the UEFA one is mainly administered by the PL (who have no actual say in the rules themselves). 

Thanks, had a feeling it was something like that.

Chelsea had they not made CL this year- given their reliance on player sales or profit on player transactions, utilisation of the academy to these ends etc, might have been an interesting one for failing FFP- Arsenal- Arsenal- of all sides- maybe too. Saw a graphic in January that suggested that they could be losing £90m or something (before allowances granted) this season as a projected figure.

Or not? Internet is a funny thing, all sorts on there!

Edited May 20, 2019 by Mr Popodopolous

[Davefevs]

9 hours ago, downendcity said:

It's because of this that I cannot see how a forecast sale can be included in the accounts for ffp.

There seems to be an issue when a club has a financial year end falling in the summer, i.e. after the transfer window opens, as they can include a forecast sale, as Vila could well have done with Grealish.

However, at a stroke, this gives those clubs an advantage over every other club whose year end is end of March or end of the tax year, as those clubs don't have he summer window into which they can forecast a player sale in the same way.

 

All EFL and Prem clubs have to have an accounting year of End of May, June or July.

[bcfctim]

9 hours ago, Davefevs said:

All EFL and Prem clubs have to have an accounting year of End of May, June or July.

But why leave it at that, is what I don't understand? What not set it as a basic requirement of registration to the league that you must file your accounts for each year prior to the end of the season - 31st April say.

It's such an obvious, blatant loophole and it appears so easy to close

[downendcity]

55 minutes ago, bcfctim said:

But why leave it at that, is what I don't understand? What not set it as a basic requirement of registration to the league that you must file your accounts for each year prior to the end of the season - 31st April say.

It's such an obvious, blatant loophole and it appears so easy to close

To everyone but the EFL!

[eastonboy]

2 hours ago, bcfctim said:

But why leave it at that, is what I don't understand? What not set it as a basic requirement of registration to the league that you must file your accounts for each year prior to the end of the season - 31st April say.

It's such an obvious, blatant loophole and it appears so easy to close

(Pedantic hat on)

Because April doesn't have 31 days.

 

(Pedantic hat off)

[bcfctim]

1 hour ago, eastonboy said:

(Pedantic hat on)

Because April doesn't have 31 days.

 

(Pedantic hat off)

You've rumbled me. I in fact work for the EFL as a Fixture Logistics Manager. You can set that date aside in your diary for Middlesbrough away, folks.

[Mr Popodopolous]

Leeds could absolutely be a good ally in terms of FFP. Now this is partly due to the bad blood between the two clubs, but the underlying point is sound!

[Mr Popodopolous]

Legal question.

Can these clubs be disciplined over this, and perhaps even sued by other clubs under the "good faith" clause in the EFL regs? Because I would argue that though no rule against, purchase of assets to circumvent FFP is a huge middle finger up to that!

I believe this could ride a cart and horse through the "utmost good faith" regulation. It reads as follows:

Quote

each club shall behave towards each other club and the League with the utmost good faith.”

It's a pipe dream but I believe those clubs who acted in good faith towards the League and the regs by selling those players to help comply, to do it legitimately- well it is a dream but they should be compensated to the amount of the difference between the player sales and the FFP deficit. Or perhaps extend their allowable FFP deficits by an equivalent margin a more realistic albeit unlikely thing.

Edited May 22, 2019 by Mr Popodopolous

[downendcity]

3 minutes ago, Mr Popodopolous said:

Genuine question.

Can these clubs be disciplined over this, and perhaps even sued by other clubs under the "good faith" clause in the EFL regs? Because I would argue that though no rule against, purchase of assets to circumvent FFP is a huge middle finger up to that!

Clubs suing other clubs could be a recipe for disaster, as it could lead to clubs looking for legal ways to "bring down" rivals. You only have to look at the acrimony ( albeit relatively brief) created when SL was trying to garner support for Leeds to be docked points for spygate.

Would it be possible for clubs to sue the EFL under the same "good faith" clause and on the back of the EFL failing to apply their own rules regarding ffp? I would have thought this would be a far better corse of action and it would carry much more weight if a number of disaffected clubs were involved in such action. It is often suggested that the reason the EFL are not  enforcing ffp punishments against "big" clubs like Villa and Derby is for fear of being dragged into legal action by clubs like this if they did attempt to deny them promotion.

Legal action being brought by one club for the EFL doing their job is one thing. The threat of legal action by a number of clubs against the EFL for failing to do their job and carry out thrown rules would surely be of greater concern.

 

 

[Mr Popodopolous]

5 minutes ago, downendcity said:

Clubs suing other clubs could be a recipe for disaster, as it could lead to clubs looking for legal ways to "bring down" rivals. You only have to look at the acrimony ( albeit relatively brief) created when SL was trying to garner support for Leeds to be docked points for spygate.

Would it be possible for clubs to sue the EFL under the same "good faith" clause and on the back of the EFL failing to apply their own rules regarding ffp? I would have thought this would be a far better corse of action and it would carry much more weight if a number of disaffected clubs were involved in such action. It is often suggested that the reason the EFL are not  enforcing ffp punishments against "big" clubs like Villa and Derby is for fear of being dragged into legal action by clubs like this if they did attempt to deny them promotion.

Legal action being brought by one club for the EFL doing their job is one thing. The threat of legal action by a number of clubs against the EFL for failing to do their job and carry out thrown rules would surely be of greater concern.

 

 

Like a class action, joint lawsuit?

I really think clubs complying should go for this, clubs who have made sacrifices- perhaps clubs suing each other not ideal you're right, but it would in some respects be richly deserved.

So far I believe you can put us, Middlesbrough, Leeds and Nottingham Forest into the possibles for any sort of legal action- there are probably a lot more who try to comply than don't as well. Birmingham got punished- embargo and points over a period, you can add them. They didn't try to sell their ground etc!

On that note...

Sounds like Aston Villa might be gearing up for similar- EFL should have closed this loophole as soon as Derby did it.

Edited May 22, 2019 by Mr Popodopolous

[downendcity]

24 minutes ago, Mr Popodopolous said:

Like a class action, joint lawsuit?

I really think clubs complying should go for this, clubs who have made sacrifices- perhaps clubs suing each other not ideal you're right, but it would in some respects be richly deserved.

So far I believe you can put us, Middlesbrough, Leeds and Nottingham Forest into the possibles for any sort of legal action- there are probably a lot more who try to comply than don't as well. Birmingham got punished- embargo and points over a period, you can add them. They didn't try to sell their ground etc!

On that note...

Sounds like Aston Villa might be gearing up for similar- EFL should have closed this loophole as soon as Derby did it.

[Mr Popodopolous]

19 minutes ago, downendcity said:

I don't like football to be settled in the courtroom rather than the boot room (closest room analogy I could think of), but I am genuinely thinking something legally needs to be done by clubs about this situation.

CAS, compensation, whatever- it's abysmal, where you have a handful of clubs wilfully flouting the regs and everyone else selling to comply or trying to comply.

Edited May 22, 2019 by Mr Popodopolous

[milo1111]

All of this is quite sickening. The whole situation is going to end up in a legal battle. The ELF have brought this on themselves by pandering to the cheats for fear of being sued.

[downendcity]

1 minute ago, Mr Popodopolous said:

I don't like football to be settled in the courtroom rather than the boot room (closest room analogy I could think of), but I am genuinely thinking something legally needs to be done by clubs about this situation.

CAS, compensation, whatever- it's abysmal, where you have a handful of clubs wilfully flouting the regs and everyone else selling to comply or trying to comply.

What is most abysmal is that the EFL, after introducing new rules and penalties with a fanfare, now seem to be impotent when it comes to applying them. It's this impotence that is allowing some clubs to flout the rules with apparent impunity, while the clubs that are complying are being made to look like naive fools.

I do think it needs those "naive fools" to do something about it, otherwise I can see ffp continuing in the same vein, other than more and more clubs will take a lead from  the likes of Derby and Villa on the basis if it's good enough for them then it's good enough for us.

[Mr Popodopolous]

5 minutes ago, downendcity said:

What is most abysmal is that the EFL, after introducing new rules and penalties with a fanfare, now seem to be impotent when it comes to applying them. It's this impotence that is allowing some clubs to flout the rules with apparent impunity, while the clubs that are complying are being made to look like naive fools.

I do think it needs those "naive fools" to do something about it, otherwise I can see ffp continuing in the same vein, other than more and more clubs will take a lead from  the likes of Derby and Villa on the basis if it's good enough for them then it's good enough for us.

Absolutely. 

The funny- yet depressing- thing about it is the clubs who do comply, who try to comply- outnumber vastly those who do not! Impotence and incompetence I feel- Mark Ashton as head instead of Shaun Harvey and I think we would see a different scenario in terms of implementation.

Quote

 

 EFL Regulation 3.4 in Section 2 – Membership:

“In all matters and transactions relating to The League each Club shall behave towards each other Club and The League with the utmost good faith. Further, each Club shall deliver to the League a copy of the Club Charter signed by the appropriate Relevant Person for and on behalf of the Club. The League shall be entitled to publish the Club Charter.”

 

That good faith rule in full. I wonder if this could be the basis for a legal fightback.

I agree with suing the EFL in principle- the problem I see with it is, what is the EFL's income? The potential losses or the revenue needlessly gained from transfers would far outweigh this I'd have thought.

Edited May 22, 2019 by Mr Popodopolous

[downendcity]

2 minutes ago, milo1111 said:

All of this is quite sickening. The whole situation is going to end up in a legal battle. The ELF have brought this on themselves by pandering to the cheats for fear of being sued.

This is what I fail to understand.

The championship operates under the auspices of the EFL. The EFL set the rules of said competition, which include the ffp rules, and all clubs competing in the championship do so in full knowledge of those rules and in so doing, I can only assume they accept those rules and agree to abide by them.

This being the case, I cannot fathom on what basis  any club could then  take legal action if the EFL then took action against the club if the club broke any of  those rules and the EFL applied one of the stated penalties for that breach?

A case of talking the talk ..................