The Championship FFP Thread (Merged)

[Mr Popodopolous]

8 minutes ago, Delta said:

I think you've now answered your own question.

Didn't appear in the P&L at the top and though I thought it possible. I was sceptical yesterday that it would, despite some other clubs having done it.

So as we were then.

Edited March 4, 2020 by Mr Popodopolous

[Drew Peacock]

1 hour ago, Mr Popodopolous said:

@AnotherDerbyFan

I'm interested in why you're rallying with Villa on this- you've been charged post Investigation, and you should for purposes of equitable treatment want some kind of Investigation for them on their return to the Championship over this 3 year period and this ground sale and leaseback, whenever that might be.

Investigation and guilt/charge are two very different concepts of course. However I'd suggest the EFL have the right to investigate that 3 year period.

In general.

Villa Park, if Other Loans Receivable at £56.7m refers to that, appears surely that it might be getting paid for off the back of loans- could be that it is paid for via loans from the owners but has to be paid back which is curious.

How does FFP at Championship level deal with this?

That's unique among the 5 btw.

Derby and Reading had it appear in their cash flow statement the year of sale.

Birmingham and Sheffield Wednesday had it appear in Other Debtors.

Both of these methods imply that the money will be going to the club either now, or later and it will be a true transaction. Price or rent terms or similar are a different matter, some seem more realistic than others.

This though implies that the cash will be loaned to Aston Villa over god knows what time frame- loaned, not paid for a transaction- loans maybe written off sometime in the future but valuation aside, I struggle to see how this is compatible with a £36m profit on disposal in the here and now!

@Coppello @Drew Peacock @martnewts 

You all are strong on accounting IIRC, any ideas??

Sales price £56.7m less NBV of £21.1m gives £35.6m profit.  How the proceeds are shown - cash, debtors, loan, is irrelevant to calculating the profit on the sale.

Showing the proceeds is a little unusual, is it shown as a long term loan?

[Mr Popodopolous]

5 minutes ago, Drew Peacock said:

Sales price £56.7m less NBV of £21.1m gives £35.6m profit.  How the proceeds are shown - cash, debtors, loan, is irrelevant to calculating the profit on the sale.

Showing the proceeds is a little unusual, is it shown as a long term loan?

I'm querying the profit and sale price too but that's another debate.

Debtors I can understand, Proceeds as in Derby and Reading in the cash flow statement shows it's been paid I'm guessing but Loans- even for FFP purposes if not accounting regs per'se seems a bit odd.

Could it not mean that Aston Villa are receiving it as a loan as opposed to an actual payment if that makes sense? For FFP I'm unsure that should count as such.

Edited March 4, 2020 by Mr Popodopolous

[Mr Popodopolous]

In layman's terms, preparing to get it wrong :laugh:...

I would like to buy someone's car- but I would loan them the money in order to purchase it.

They bank the profit on said sale in their sole trader accounts but are yet to receive the cash- they are yet to receive the cash but will receive it, in the form of a loan.

In other words barring a write off which I dare say will come down the track, I pay someone to take their car off their hands- but I nonetheless want the loan repayments- plus rent of course, Villa Park will have rent- so I receive rent for said car as well!

Rent as loan repayments?

For FFP at least this is a whole new level.

Financing via loans, repayable on demand in exchange for an asset.

Edited March 4, 2020 by Mr Popodopolous

[Mr Popodopolous]

5 hours ago, Mr Popodopolous said:

Not even looked at the consolidated accounts yet but this raises interesting questions.

Couple of million of the profit was related to a grant but....

 

 

 

 

 

 

 

 

One further note- relating to the Prior Year Adjustment.

The cost therefore shoots up- yet the NBV is far below this, hence the significant profit on sale possibly- this is at Cost not Fair Value which it was until 2017- the latter is exceeded by the Cost which seems unusual based on Precedent?

Curiouser and curiouser?

Edited March 4, 2020 by Mr Popodopolous

[downendcity]

3 hours ago, Mr Popodopolous said:

In layman's terms, preparing to get it wrong :laugh:...

I would like to buy someone's car- but I would loan them the money in order to purchase it.

They bank the profit on said sale in their sole trader accounts but are yet to receive the cash- they are yet to receive the cash but will receive it, in the form of a loan.

In other words barring a write off which I dare say will come down the track, I pay someone to take their car off their hands- but I nonetheless want the loan repayments- plus rent of course, Villa Park will have rent- so I receive rent for said car as well!

Rent as loan repayments?

For FFP at least this is a whole new level.

Financing via loans, repayable on demand in exchange for an asset.

 

Delta will be posting a reply on this ........

[Mr Popodopolous]

The precise wording of that UEFA rule- for comparison purposes if anything!

Quote

h) Excess proceeds on disposal of tangible fixed assets

The profit on disposal of tangible fixed assets (including, but not limited to, a club’s stadium and training facilities) in a reporting period must be excluded from the break-even result with the following two exceptions:

i) If a tangible fixed asset other than a stadium or training facilities is not being replaced, then the profit on disposal recognised in the income statement can be taken into account as a relevant income up to:

•  the difference between the proceeds on disposal and the historical cost of the asset which was recognised as a tangible fixed asset in the financial statements of the reporting entity;

ii) If a club demonstrates that it is replacing a sold fixed asset, then the profit on disposal recognised in the income statement can be taken into account as a relevant income up to:

•  the difference between the proceeds on disposal and the full cost of the replacement asset which is recognised, or to be recognised, as a tangible fixed asset in the financial statements of the reporting entity;
•  the difference between the proceeds on disposal and the present value of 50 years’ minimum lease payments in respect of the replacement asset to be used by the club under a lease/rental arrangement.

https://www.uefa.com/MultimediaFiles/Download/Tech/uefaorg/General/02/56/20/15/2562015_DOWNLOAD.pdf

All a bit dry but rather watertight I'd say!

Edited March 4, 2020 by Mr Popodopolous

[Davefevs]

8 hours ago, Mr Popodopolous said:

Seems they didn't reduce the wage bill at all- I assumed it would've been down by £5-10m but even excluding promotion bonuses it stayed flat at best!

I also assumed- wrongly possibly- that Amortisation of Player Registrations would've come down- nope it increased!

£36.3m profit on Villa Park is curious, given we've been told that it's easily worth what it was sold for...

In the cash flow statements, there is/has been the princely sum of £10,000 received on "Proceeds from disposal of tangible fixed assets".

In fact, further digging suggests that this is all still due.

The rent might be £2.6m per year but it's not explicitly stated as such.

Now as I've mentioned before, UEFA have a rule that would negate all of this. Let's assume rent £2.6m per season?

UEFA with such transactions take 50 years of rental payment unless the ground has been disposed of truly in a genuinely arms length transaction and put that then subtract the profit for FFP purposes...profit negated at best if they eliminate loss on disposal of fixed assets, and a £90-95m loss at worst if you don't!

Seems to be though on early reading, this stadium sale, payable in the form of loans due from NSWE Stadium Limited.  Seems a bit similar to both Birmingham and Sheffield Wednesday from that respect- though I can't see anything wrong with the price or rent in Birmingham's case.

As always, very interested in your thoughts @Davefevs

Bit of a rubix cube this...will be interesting to see what everyone thinks.

Personally speaking at this time, I'm struggling to fathom how the stadium sale is right. It might be that the price is right- it might be that the Profit is right- but I don't see how both can be right.

It just feels out of kilter, one way or another as of now.

I don’t understand the property stuff in fairness.

But I really would like to see them relegated.

[Mr Popodopolous]

2 minutes ago, Davefevs said:

I don’t understand the property stuff in fairness.

But I really would like to see them relegated.

It's still a bit of a learning process for me too!

Yes- a last minute fall from grace into the drop zone with VAR would be perfect!

[Delta]

Never mind Villa Talk - You guys have hit the headlines here:

https://www.heroesandvillains.info/forumv3/index.php?topic=55680.525

Post# 536 onwards

[bcfc01]

That Villa forum is a bit of a throw back - as bad as the Pikeys.

 

[downendcity]

4 minutes ago, Delta said:

Never mind Villa Talk - You guys have hit the headlines here:

https://www.heroesandvillains.info/forumv3/index.php?topic=55680.525

Post# 536 onwards

 

Quote from: Ads on Today at 02:08:46 PM

There's a thread on a Bristol City forum that I glance at everytime a financial statement comes out about us. Looks like its attracted a couple of Villa fans too (anybody off here?).

It's basically the internet equivalent of a child jumping up and down saying it's not fair!!!

A site called OTIB and in the FPP thread. 

 

Jesus, what a bellend that Pompousopolous is.

 

@Mr Popodopolous  I presume it's you they are referring to, and confirming what we have all long suspected!

 

[Mr Popodopolous]

Fame at last! Always for some reason, had a slight preference for the other BCFC- always seen them as the more working class side etc?

I look forward to reading his greater expertise on accounting and valuation methods/regulations.

Fair's fair though- if he actually does have it I genuinely do look forward to having a look.

Edited March 4, 2020 by Mr Popodopolous

[Mr Popodopolous]

Back to factuality.

Looks like confirmation of loans receivable being the method of payment, and it looks like the rent is £2.6m per year/season.

Edited March 4, 2020 by Mr Popodopolous

[Delta]

4 hours ago, Mr Popodopolous said:

Fame at last! Always for some reason, had a slight preference for the other BCFC- always seen them as the more working class side etc?

I look forward to reading his greater expertise on accounting and valuation methods/regulations.

Fair's fair though- if he actually does have it I genuinely do look forward to having a look.

BCFC are traditionally south Birmingham, AVFC are traditionally north Birmingham - Both traditionally working class.

[Mr Popodopolous]

11 hours ago, Delta said:

BCFC are traditionally south Birmingham, AVFC are traditionally north Birmingham - Both traditionally working class.

Okay maybe then- thanks- always had an impression of Aston Villa as more middle class, maybe it's a modern football thing? Certainly a lot of establishment fans :laugh:...not just a certain HRH but Mervyn King, David Cameron to name 2.

Edited March 5, 2020 by Mr Popodopolous

[Mr Popodopolous]

Still struggling to work out how it's justifiable to stick the profit in the P&L for that season?

Loans Receivable- have Villa loaned the money to NSWE UK to purchase the stadium? That must be wrong, my interpretation.

Wasn't aware loans receivable counted as relevant income/profit for FFP anyway.

 

Edited March 5, 2020 by Mr Popodopolous

[martnewts]

23 hours ago, Mr Popodopolous said:

@AnotherDerbyFan

I'm interested in why you're rallying with Villa on this- you've been charged post Investigation, and you should for purposes of equitable treatment want some kind of Investigation for them on their return to the Championship over this 3 year period and this ground sale and leaseback, whenever that might be.

Investigation and guilt/charge are two very different concepts of course. However I'd suggest the EFL have the right to investigate that 3 year period.

In general.

Villa Park, if Other Loans Receivable at £56.7m refers to that, appears surely that it might be getting paid for off the back of loans- could be that it is paid for via loans from the owners but has to be paid back which is curious.

How does FFP at Championship level deal with this?

That's unique among the 5 btw.

Derby and Reading had it appear in their cash flow statement the year of sale.

Birmingham and Sheffield Wednesday had it appear in Other Debtors.

Both of these methods imply that the money will be going to the club either now, or later and it will be a true transaction. Price or rent terms or similar are a different matter, some seem more realistic than others.

This though implies that the cash will be loaned to Aston Villa over god knows what time frame- loaned, not paid for a transaction- loans maybe written off sometime in the future but valuation aside, I struggle to see how this is compatible with a £36m profit on disposal in the here and now!

@Coppello @Drew Peacock @martnewts 

You all are strong on accounting IIRC, any ideas??

@Mr Popodopolous as I think you have identified later the stadium sale proceeds have not been received in cash at the year end hence the debtor "other loans receivable".

The reason for this may well be that the transaction wasnt completed prior to the year end so the accounting entry would have been debit other loans receivable with the proceeds amount, credit profit/loss on disposal of fixed assets for the proceeds.

Then to get to the actual profit on disposal there would have been a credit to fixed asset cost (in the balance sheet fixed assets note) with a debit to profit/loss on disposal of fixed assets then a debit to depreciation on fixed assets (in the balance sheet fixed assets note) with a credit to profit/loss on disposal of fixed assets this then leaves the profit on disposal of fixed asset in the profit and loss account and the debtor other loans receivable in the balance sheet.

Is the other loans receivable amount shown as a current asset? If so then it should be repayable within a year of the balance sheet date.

 

[Mr Popodopolous]

15 minutes ago, martnewts said:

@Mr Popodopolous as I think you have identified later the stadium sale proceeds have not been received in cash at the year end hence the debtor "other loans receivable".

The reason for this may well be that the transaction wasnt completed prior to the year end so the accounting entry would have been debit other loans receivable with the proceeds amount, credit profit/loss on disposal of fixed assets for the proceeds.

Then to get to the actual profit on disposal there would have been a credit to fixed asset cost (in the balance sheet fixed assets note) with a debit to profit/loss on disposal of fixed assets then a debit to depreciation on fixed assets (in the balance sheet fixed assets note) with a credit to profit/loss on disposal of fixed assets this then leaves the profit on disposal of fixed asset in the profit and loss account and the debtor other loans receivable in the balance sheet.

Is the other loans receivable amount shown as a current asset? If so then it should be repayable within a year of the balance sheet date.

 

Thanks for the response @martnewts .

Yep, seems not received yet- other loans receivable. Interested in the use of the term 'loans' as well but that could be a red herring.

Land Registry suggested it was there by 21st May 2019, or sold on that date anyway- 10 days before the year/reporting period ended.

Do you by the balance sheet fixed asset note mean Tangible Assets?

Other Loans receivable amount seems to be under 'Debtors'. It's listed as being Repayable on Demand.

Convinced that there could be a case to answer for that 3 year period, given that the transaction was very much the difference between compliance and FFP.

 

Edited March 5, 2020 by Mr Popodopolous

[martnewts]

26 minutes ago, Mr Popodopolous said:

Thanks for the response @martnewts .

Yep, seems not received yet- other loans receivable. Interested in the use of the term 'loans' as well but that could be a red herring.

Land Registry suggested it was there by 21st May 2019, or sold on that date anyway- 10 days before the year/reporting period ended.

Do you by the balance sheet fixed asset note mean Tangible Assets?

Other Loans receivable amount seems to be under 'Debtors'. It's listed as being Repayable on Demand.

Convinced that there could be a case to answer for that 3 year period, given that the transaction was very much the difference between compliance and FFP.

 

@Mr Popodopolous Yes tangible assets note 

[JackofromSanJavier]

I look forward to an @BigTone potted summary of this whole saga.  I might have a slim chance of understanding what it's all about, then.........

[Mr Popodopolous]

30 minutes ago, martnewts said:

@Mr Popodopolous Yes tangible assets note 

So they've disposed of the ground held at cost- even though as recently as 2017 it was held as Investment Property under Fair Value, and eliminated the depreciation- suddenly restated in 2017/18 accounts to Tangible Fixed Assets as cost- which was about £20m or so more than when it was Investment Property as held at Fair Value.

My concern is that it is classed under Other Loans and the category in turn was Debtors but yet the profit on disposal in the here and now was stuck in the P&L- all seems a bit...curious.

How that fits with FFP as well, is a puzzle, to me anyway.

Edited March 5, 2020 by Mr Popodopolous

[Merrick's Marvels]

13 hours ago, Delta said:

BCFC are traditionally south Birmingham, AVFC are traditionally north Birmingham - Both traditionally working class.

Yeah, that Prince William is sooooooooo working class, isn't he?  

[Mr Popodopolous]

4 minutes ago, Merrick's Marvels said:

Yeah, that Prince William is sooooooooo working class, isn't he?  

David Cameron, Mervyn King to name 2 more...

Ever so slightly men of the people. 

[bcfc01]

4 minutes ago, Mr Popodopolous said:

David Cameron, Mervyn King to name 2 more...

Ever so slightly men of the people. 

Whereas we have Baldrick...

[Mr Popodopolous]

Kieran Maguire's calculations from the other day as to how they passed FFP.

Edited March 5, 2020 by Mr Popodopolous

[AnotherDerbyFan]

On 04/03/2020 at 11:31, Mr Popodopolous said:

@AnotherDerbyFan

I'm interested in why you're rallying with Villa on this- you've been charged post Investigation, and you should for purposes of equitable treatment want some kind of Investigation for them on their return to the Championship over this 3 year period and this ground sale and leaseback, whenever that might be.

Investigation and guilt/charge are two very different concepts of course. However I'd suggest the EFL have the right to investigate that 3 year period.

In general.

Villa Park, if Other Loans Receivable at £56.7m refers to that, appears surely that it might be getting paid for off the back of loans- could be that it is paid for via loans from the owners but has to be paid back which is curious.

How does FFP at Championship level deal with this?

That's unique among the 5 btw.

Derby and Reading had it appear in their cash flow statement the year of sale.

Birmingham and Sheffield Wednesday had it appear in Other Debtors.

Both of these methods imply that the money will be going to the club either now, or later and it will be a true transaction. Price or rent terms or similar are a different matter, some seem more realistic than others.

This though implies that the cash will be loaned to Aston Villa over god knows what time frame- loaned, not paid for a transaction- loans maybe written off sometime in the future but valuation aside, I struggle to see how this is compatible with a £36m profit on disposal in the here and now!

@Coppello @Drew Peacock @martnewts 

You all are strong on accounting IIRC, any ideas??

How am I rallying with Villa? I only pointed out that UEFA rules have no relevance to Championship clubs, with the exception of fluking at cup win. I don't believe I've commented on whether Villa should or shouldn't be investigated. However, I'l give you my view now. The EFL had the opportunity to investigate and punish Villa before they officially became a Premier League Club. Now they're in the Premier League, it's down to them to investigate and punish if necessary. If Villa go down this season, then the EFL can investigate them again for the relevant 3-year rolling period (18/19, 19/20 and  projected 20/21). If they find some wrong-doing in relation to their stadium sale in 18/19, then I'd support a punishment for them. If Villa survive relegation this season but go down in the future, then I would oppose the EFL investigating Villa for selling their stadium.

Regarding the likes of Derby, I disagree on the EFL's decision to renege on the EFL Executive's decision to approve the stadium sale, amortisation policy, and all FFP/P&S accounts, unless the club were not as transparent as they claim or there was some other 'improper' practice.

Your comment regarding deducting 50 years lease cost off the value is another no go. Why should a club selling it's ground at it's book value be penalized for selling it? It would prevent an owner doing it purely for P&S purposes, but punish those who have a valid reason for it. Let's say an owner wanted extra investment into his club. Selling the stadium 'to himself' would make it more affordable for the investor to buy into the club whilst offering a safety net regarding the stadium to the owner and the fans.

[AnotherDerbyFan]

1 hour ago, Mr Popodopolous said:

So they've disposed of the ground held at cost- even though as recently as 2017 it was held as Investment Property under Fair Value, and eliminated the depreciation- suddenly restated in 2017/18 accounts to Tangible Fixed Assets as cost- which was about £20m or so more than when it was Investment Property as held at Fair Value.

My concern is that it is classed under Other Loans and the category in turn was Debtors but yet the profit on disposal in the here and now was stuck in the P&L- all seems a bit...curious.

How that fits with FFP as well, is a puzzle, to me anyway.

The stadium was sold so appears on the P/L. However, the money doesn't have to change hands straight away.

[Mr Popodopolous]

24 minutes ago, AnotherDerbyFan said:

The stadium was sold so appears on the P/L. However, the money doesn't have to change hands straight away.

Thanks, I get that bit. I have an issue with the fact it seems to be in the form of loan. Had it been 'Other Debtors' that sits a bit easier.

Wondering how such transactions are treated for FFP purposes.

Edited March 5, 2020 by Mr Popodopolous

[Mr Popodopolous]

40 minutes ago, AnotherDerbyFan said:

How am I rallying with Villa? I only pointed out that UEFA rules have no relevance to Championship clubs, with the exception of fluking at cup win. I don't believe I've commented on whether Villa should or shouldn't be investigated. However, I'l give you my view now. The EFL had the opportunity to investigate and punish Villa before they officially became a Premier League Club. Now they're in the Premier League, it's down to them to investigate and punish if necessary. If Villa go down this season, then the EFL can investigate them again for the relevant 3-year rolling period (18/19, 19/20 and  projected 20/21). If they find some wrong-doing in relation to their stadium sale in 18/19, then I'd support a punishment for them. If Villa survive relegation this season but go down in the future, then I would oppose the EFL investigating Villa for selling their stadium.

Regarding the likes of Derby, I disagree on the EFL's decision to renege on the EFL Executive's decision to approve the stadium sale, amortisation policy, and all FFP/P&S accounts, unless the club were not as transparent as they claim or there was some other 'improper' practice.

Your comment regarding deducting 50 years lease cost off the value is another no go. Why should a club selling it's ground at it's book value be penalized for selling it? It would prevent an owner doing it purely for P&S purposes, but punish those who have a valid reason for it. Let's say an owner wanted extra investment into his club. Selling the stadium 'to himself' would make it more affordable for the investor to buy into the club whilst offering a safety net regarding the stadium to the owner and the fans.

Okay fair enough, you seem fair minded enough- you're right little relevance- I think they have the right idea on certain issues though.

EFL investigate based on the info they have/had to May 2019 yep, PL on the info they have yep- and the 3 year bit to 2021 all okay. Holding over an investigation for the future all good, however I do think an Investigation commending in 2020 if they come down for the 3 years to May 2019 would be alright- a precedent is and can be set, see Man City.

Closer to home yourselves and Sheffield Wednesday- perhaps further evidence came to light or maybe- and this is where it could get really messy- but maybe, could it be possible, that Shaun Harvey approved the transactions for yourselves and the other clubs and exceeded his authority in doing so? Thinking largely how the stada were sold, profit, value etc. The amortisation policy, I think the EFL will find it harder to make that stick, unless they have a concrete policy that states a given amortisation method is required e.g. They should have one if possible, but whether that's feasible...

Okay that was purely aimed at P&S then- valid reasons could be alright, but I have a bit of an issue with selling assets to commonly owned companies or related parties which can ultimately put extra revenue in for wages/transfers etc. IF the club don't profit on it, or the EFL hired valuer comes first and the price set then, not after the event. Could it be done at Book/Net Book Value, transfer rather than sale in order to secure it in the event of future investment.

Edited March 5, 2020 by Mr Popodopolous

[Mr Popodopolous]

Interesting thread by Mike Thornton on the other loans stuff.

Accounting does seem to be about Interpretation and arguments as well as hard and fast regs, to a point?

Edited March 5, 2020 by Mr Popodopolous

[Drew Peacock]

7 minutes ago, Mr Popodopolous said:

 

Accounting does seem to be about Interpretation and arguments as well as hard and fast regs, to a point?

And that's what made the annual audit so much fun............................. 

[downendcity]

34 minutes ago, Mr Popodopolous said:

Interesting thread by Mike Thornton on the other loans stuff.

Accounting does seem to be about Interpretation and arguments as well as hard and fast regs, to a point?

Don't know about hard and fast, but fast and loose would seem a more appropriate description!

[downendcity]

We can go back and forwards debating ffp with fans of other clubs and, as has been shown, they will always have an answer exonerating their club, despite whatever factual evidence is placed in front of them, and a explanation of every convoluted accounting device and action that has taken place

My overview of the situation is therefore summed up in by Walter Scott's quote - " O, what a tangled web we weave when first we practice to deceive".

 

[Mr Popodopolous]

Yeah, agreed.

On the note of whether sources, me whoever incorrect- carried over from the other thread- it is interesting to note that having had a quick look at the numebrs.

Aston Villa Loss £68.9m

Xia payment and Promotion Bonuses, both contingent on Promotion- £45.8m

Rolling losses £23.1m

Subtract ground sale as it probably wasn't in place in March 2019- remember the stories at the time of Aston Villa having to explain a loss of £60m- £36.4m the Profit on this.

£59.5m.

Lawton's article from the time was spot on quite possibly, about having to explain losses that could've totalled £60m. 

(I'm assuming the HS2 was already accounted for).

Who knows what else he was spot on about? Derby and Sheffield Wednesday have subsequent faced referral to Disciplinary Commissions after all.

Let's be fair though, he was broadly spot on because of leaks from one source- individuals- or another- individuals at clubs. Surely that is how we hear these stories, leaks or being told info off the record, to in particular him, Matt Hughes, John Percy when it comes to the FFP issue. Credit to those 3 journos!

Edited March 5, 2020 by Mr Popodopolous

[Davefevs]

5 hours ago, Mr Popodopolous said:

Interesting thread by Mike Thornton on the other loans stuff.

Accounting does seem to be about Interpretation and arguments as well as hard and fast regs, to a point?

That was the guy I was trying to think of the other day.

[Mr Popodopolous]

2 hours ago, Davefevs said:

That was the guy I was trying to think of the other day.

Good isn't he.

Said some quite strong stuff on it. 

Of course I'm assuming there's an FRS 102 regulation or subclause etc that allows it because if not.

Well I was looking at accounts earlier, for random UK companies in the 'real world' and not one had kind of profit recognition process.

Genuinely would be keen to hear the accounting, let alone the FFP reg that allows for this. Accounting reg first though.

Maybe substance over form. Purely a guess.

Edited March 5, 2020 by Mr Popodopolous

[reddoh]

11 hours ago, JackofromSanJavier said:

I look forward to an @BigTone potted summary of this whole saga.  I might have a slim chance of understanding what it's all about, then.........

just trying to beat him to it

Condensed Version

FIIK or FIIC

[Mr Popodopolous]

One note.

Seems Birmingham's Business Plan related charge has been dismissed by the Independent Disciplinary Commission. I still wonder about whether their ground sale should count as profit given the nature of that arrangement but I've not been so bothered about Birmingham for a few reasons. Price seems fine, rent seems commercial- over 5% so in a sense...

Structure of ground sale and leaseback though. Would need a flow chart but a list will have to do for now.

1. Birmingham City PLC or is it Birmingham City Football Club PLC owned/own St Andrews.
2. Birmingham City Football Club PLC are controlled by Birmingham City PLC.
3. Birmingham City PLC are controlled by Paul Suen.
4. Stadium was sold by 1 or 2 to Birmingham City Stadium Ltd- which is based in the UK but...
5. Birmingham City Stadium Ltd seems to have controlling party listed as Birmingham Sports Holdngs Ltd- Paul Suen seems to run this too, though there is some doubt about that. Birmingham Sports Holdings Ltd is listed on HKSE and is based in the Cayman Islands.

My question is, can it not cancel out in the UK most senior party ie Birmingham City PLC as opposed to be classed as profit- or is it a case that sale of an asset from one UK based subsidiary to another, the purchasing party which is controlled by the HKSE listed company, while Birmingham City PLC itself is directly controlled by the head of BSH, Paul Suen- is it fine therefore to stick that through as profit for Birmingham City PLC, provided that it cancels out in the BSH ones- which it appears to have?

Seems not to have been listed as being owned by Birmingham City Stadium Ltd as yet though.

Also no cash paid for it yet, owed to them- Other Receivables.

However, it seems fine.

They also sold Adams, Jota, Vassell, lost Mahoney, Morrison- look to be changing tack in general. Sacking Monk and replacing him with Clotet surely a bit of downsizing.

The EFL have to appeal this ruling though as the Business Plan one, could set a precedent if upheld?

Dismissal by the Disciplinary Commission actually can work in the EFL's favour in this instance as it can add strong proof off the back of that, that decisions aren't just an EFL led whitewash and appealing it would also show useful governance. 3 points in the grand scheme at most is nothing for a midtable side, but it could pose an issue in the future,

Edited March 9, 2020 by Mr Popodopolous

[Mr Popodopolous]

Done a little alternative way of calculating Hillsborough's value. Simplistic but here goes...

Take the 2014 valuation under DRC method at £22.25m and stick it in an RPI calculator inputted to come out in 2018.

Take all subsequent additions since then, and stick in the same RPI calculator as above inputted for 2018.

Eliminate Depreciation on Disposal- and that Depreciation clock started again in 2014 on revaluation at DRC.

Certainly don't see how it's anything much above £30m at most and quite likely less. About £29-29.5m through this, once Depreciation gone and that's assuming that all of the Additions for Freehold Property and Plant and Machinery were for Hillsborough.

Was carried at cost until 2015 or 2016, but that cost was not much less than the valuation in 2014 and can probably work it out what it would've been using 2015 as a starting point.

EDIT- Seems I was using a normal Inflation calculator, maybe RPI would throw up some different outcomes...

https://www.erikasgrig.com/calculators/rpi-calculator-inflation

Edited March 9, 2020 by Mr Popodopolous

[Mr Popodopolous]

It inspired me to look at the 5 deals again.

Birmingham- Price seems fine, rent seems fine. Rent 25 years at £1.25m per season, price it sold for was £22-23m- nothing to see here tbh. Later than 5 years also sees it stack up.

Derby- and I found this courtesy of Kieran Maguire and a tweet by him last year, sells for £81.1m which we all know was overstated- or a matter of interpretation in terms of valuation methods perhaps- rent per year was around £1.1m per year. One bit I never really looked at but noticed that Rent- ie total once added up in the no later than 1 year, more than 1 but no more than 5 and 5 upwards seemed to add up to no more than £23m in the long run...bit out of kilter with sale price?

Then again, given the downgrade to around £50m, maybe not! 

Reading- Again seems to do what it said on the tin. Bit low at £750,000 per season for a £26.5m transaction but nothing to get worked up about as it stands...seems to be about £19m in total rent due, laid out like Birmingham.

Sheffield Wednesday. This one is really fun. Likely overvalued, possibly wrong Reporting Period- it's what the whole EFL charge is about. At least the rent reflects £60m though, right? Er...no. Seems to make the rent due to Mel Morris look like a great yield!

Unless it is still to come of course, it appears to be bundled under a finance lease as it stands.

£271,000 in Year 1- between 2 and 5 it is maybe £280-290k per season. What a laugh! Peppercorn, by standards of a fairly big club!!

Aston Villa is of course the most interesting.

As we know, £2.6m per season. Between 2 but no more than 5 it rises to £10.4m in total.

Suppose my questions would be why do Aston Villa and Sheffield Wednesday not have anything beyond 2-5 years-plus as per the £81.1m sale price (ha!) why was Derby's fairly low, even though it had in excess of 5 years?

[Mr Popodopolous]

Also the EFL need to be alert for any possible questionable tricks from Stoke in order to meet them head on.

Saw this on Twitter just now.

Bit more too...

Quote

Tony, would you agree Championship is different from the one Stoke was promoted from in 2008?
TS: Yes, it certainly feels different.

We are a team that’s come down and that’s very different, but we do have a better stadium and infrastructure than we had then, but that probably applies across the league.

It feels like a Premier League 2 because something like 19 out of the 24 clubs in our league have been in the Premier League.

Of the five who haven’t four are in the top eight.

The league doesn’t get the income to match its appeal and the fact it’s the third highest attended in Europe.

We also have rules which go against investing in clubs too.

Now, in the league, I feel some clubs are desperate to attack other clubs for breaking rules and trying to get them punished.

Think he's got some valid points, especially the first bolded bit- however he knows the regulations. Maybe some clubs are desperate to attack other clubs for breaking rules but that's because those clubs make big sacrifices and big efforts to try and stick within those rules, those principles.

Quote

How do you combat the penalties of Financial Fair Play?
TS: It’s something that occupies our mind all the time.

We don’t like the rules, we think the rules are ill conceived, we think they make you dumb down.

What the league should be doing is encourage the clubs to invest and get as close to the Premier League as we possibly can.

You will never see us criticising another club in relation to those rules and it’s unseemly when you see another club trying desperately to see another club get docked points.

We are lobbying to try and change the rules and if we don’t then we have to operate within the structure.

JC: I don’t think a set of rules which has a number of clubs, with nine games to go, under threat of a points deduction is good.

I believe those rules need to be changed.

He's got a point about the timing though, tbh! That said if Projected Accounts are/were enforced correctly in previous seasons even that would be moot.

I think Stoke are or will be the right side of the FFP line this season but next season could pose some big issues.

One more line- not directly related to FFP and possibly benign...but EFL should be keeping half an eye on them even so.

Quote

Is next season do-or-die for promotion because of parachute payments ending?

JC: We are continuing to support the club however we are able to do it, that’s all I can say.

One thing that is clear is that Parachute Payments plummet in Year 3, and so does the allowable loss limit...like I say fine for this season due to mix of loans out, smallish losses last year after allowable costs and quite a big 2nd year of PP but I don't see how if rules enforced correctly, they can drag on in Year 3 without significant sales and cutbacks.

Edited March 9, 2020 by Mr Popodopolous

[Victory Park Reds]

Cmon Leicester!

[Mr Popodopolous]

Seems Aston Villa have released the NSWE Stadium Limited accounts.

https://beta.companieshouse.gov.uk/company/10883540/filing-history

[Mr Popodopolous]

Interesting line from Sheffield Wednesday's case.

Sheffield Wednesday stalling...doesn't sound like they have much of a case if they are looking to drag it out?

[downendcity]

13 minutes ago, Mr Popodopolous said:

Interesting line from Sheffield Wednesday's case.

Sheffield Wednesday stalling...doesn't sound like they have much of a case if they are looking to drag it out?

Isn't this the biggest potential hurdle to ffp really working?

It's ironic that there is so much at stake financially, so If a club finds that potential ffp penalties will jeopardise it's future, by taking away promotion, or hastening relegation, then they will employ the best legal brains money can buy. Not necessarily to win their case, but to tie the EFL in knots sufficiently ( sadly proven to be not too difficult to do) that it will cause chaos as this article implies.

Wednesday might not have much of a case, but they also know that if their barrister can muddy the waters sufficiently , and certainly beyond the season's end, then the disruption to promotion and relegation could cause the EFL massive problems. If the EFL sees the knock on effect as being too problematical, then there has to be a strong likelihood that rather than pushing for points deduction that could relegate Wednesday, they will settle for a big financial penalty, which I guess the club would happily take if it enables them to avoid relegation. 

If this does happen then ffp can have no credibility as it currently administered, as every other club will be able to point to Wednesday's case as a precedent for a fine rather than points deduction.

The EFL needs to get it's act together.

[havanatopia]

Pops.. JC presumably is John Coates son of Peter? Who is Tony S ?

I think Coates is being extremely disingenuous. Rules are rules and it is absolutely bang on if a club, seeing another break those rules, reports the malfeasance.

[Mr Popodopolous]

14 minutes ago, downendcity said:

Isn't this the biggest potential hurdle to ffp really working?

It's ironic that there is so much at stake financially, so If a club finds that potential ffp penalties will jeopardise it's future, by taking away promotion, or hastening relegation, then they will employ the best legal brains money can buy. Not necessarily to win their case, but to tie the EFL in knots sufficiently ( sadly proven to be not too difficult to do) that it will cause chaos as this article implies.

Wednesday might not have much of a case, but they also know that if their barrister can muddy the waters sufficiently , and certainly beyond the season's end, then the disruption to promotion and relegation could cause the EFL massive problems. If the EFL sees the knock on effect as being too problematical, then there has to be a strong likelihood that rather than pushing for points deduction that could relegate Wednesday, they will settle for a big financial penalty, which I guess the club would happily take if it enables them to avoid relegation. 

If this does happen then ffp can have no credibility as it currently administered, as every other club will be able to point to Wednesday's case as a precedent for a fine rather than points deduction.

The EFL needs to get it's act together.

It is...

They need to find a way to expedite the process, legally speaking. Arbitration is what it appears to be stuck in.

Agreed, and clubs who go down might then look at claims against the EFL- mahjor potential issues as you say. There was talk of a deadline for points deductions for the current season but this is a grey area.

Fine vs points...but Birmingham then can point to their 9 points and through the season transfer restrictions, so I'm not sure the EFL can take that approach.

There is a good bit of news, if true though...

No cut off point in the season for Disciplinary decisions it seems.

@havanatopia

Hav, yep John is son of Peter. Tony Scholes CEO or similar I believe.

Agree, we all have to adhere to them- if breaches are suspected they must be reported and dealt with accordingly- and punished if there is a case proven.

Edited March 10, 2020 by Mr Popodopolous

[downendcity]

3 minutes ago, havanatopia said:

Pops.. JC presumably is John Coates son of Peter? Who is Tony S ?

I think Coates is being extremely disingenuous. Rules are rules and it is absolutely bang on if a club, seeing another break those rules, reports the malfeasance.

If they don't like the rules, they always take their club and find another league to play in.

[havanatopia]

2 minutes ago, downendcity said:

If they don't like the rules, they always take their club and find another league to play in.

Northern Ireland. Michael O Neil will find his commute to both jobs considerably easier. 

[bcfc01]

Sounds as if Stoke are getting their equaliser in before the EFL score..

[downendcity]

One thing I find frustrating regarding the almost shambolic way ffp hs unfolded in the last 18 months - 2 years, is the almost deafening silence from the majority of clubs that have presumably been working hard, and properly within the rules, to comply even if it has compromised their competitiveness on the pitch.

Apart from Steve Gibson sticking his head above the parapet, and getting shot at for so doing, no one has said boo to a goose. when seeing clubs riding roughshod over the spirit of ffp rules, even if they did not actually break the rules - if you know what I mean.

1 minute ago, bcfc01 said:

Sounds as if Stoke are getting their equaliser in before the EFL score..

Getting their retaliation in first?

[bcfc01]

2 minutes ago, downendcity said:

One thing I find frustrating regarding the almost shambolic way ffp hs unfolded in the last 18 months - 2 years, is the almost deafening silence from the majority of clubs that have presumably been working hard, and properly within the rules, to comply even if it has compromised their competitiveness on the pitch.

Apart from Steve Gibson sticking his head above the parapet, and getting shot at for so doing, no one has said boo to a goose. when seeing clubs riding roughshod over the spirit of ffp rules, even if they did not actually break the rules - if you know what I mean.

Probably a case of not throwing stones whilst in a glass house..

[Mr Popodopolous]

Oh yes...

Yes indeed!!

Maybe I'll book some leave if it's open to the public.

Edited March 10, 2020 by Mr Popodopolous

[downendcity]

On 18/06/2019 at 17:14, Begley said:

Interesting debate and nice to see fans from different clubs chatting. Villa fan in peace here.

There are a few mentions of Villa selling their ground to themselves (like Derby) to pass P&S. Although this is not against the rules albeit not in the spirit of P&S, it is not the case that Villa has sold Villa Park. Since buying Villa NSWE have been putting a lot of money into the club and with each investment Xia's shareholding is further diluted, apparently he now owns less that 20% of AVFC whereas he had 45% the day the sale went through. The name of the Villa Park holding company was changed and the directors of the holding company were also changed. It went from Recon (A Xia owned company) to Aston Villa (an NSWE owned company) with Xia removed as a shareholder. There was no sale of Villa Park, it was simply a further dilution of Xia's equity on AVFC 

Just came across this post from last summer, made by a villa fan.

Obviously we have no way of knowing from what position of knowledge/expertise Begley makes his/her comments, but does it put  the cat among the pigeons, as far as Villa's ffp position last season is concerned?

Our understanding has always been ( continually reinforced with glee by Delta) that Villa Park was "sold" by the football club to another of the owners' companies and the profit thereon was applied to Villa's income, completely within ffp rules and  this enabled them to pass ffp scrutiny. According to Begley's statement, taken  on face value, it seems more to do with addressing Xia's equity position than a sale in the sense that, say, Derby undertook. Also, if the stadium was previously owned by Recon ( a Xia owned company) and if it was sale transaction, then surely the proceeds of sale would be due to Recon and not AVFC.

In a recent post Delta pointed out that perhaps our grievance with Villa is because  we could not enjoy the financial benefit of selling our stadium as Villa has,  because BCFC no longer own Ashton Gate. From  Begley's post, if VP was owned by a Xia owned company Recon, then surely Villa were in the same position

Now Im no accountant or corporate finance expert, so my interpretation might be completely wrong, but can anyone throw more light on this?

 

 

 

Edited March 11, 2020 by downendcity

[Mr Popodopolous]

10 minutes ago, downendcity said:

Just came across this post from last summer, made by a villa fan.

Obviously we have no way of knowing from what position of knowledge/expertise Begley makes his/her comments, but does it put  the cat among the pigeons, as far as Villa's ffp position last season is concerned?

Our understanding has always been ( continually reinforced with glee by Delta) that Villa Park was "sold" by the football club to another of the owners' companies and the profit thereon was applied to Villa's income, completely within ffp rules and  this enabled them to pass ffp scrutiny. According to Begley's statement, taken  on face value, it seems more to do with addressing Xia's equity position than a sale in the sense that, say, Derby undertook. Also, if the stadium was previously owned by Recon ( a Xia owned company) and if it was sale transaction, then surely the proceeds of sale would be due to Recon and not AVFC.

In a recent post Delta pointed out that perhaps our grievance with Villa is because  we could not enjoy the financial benefit of selling sell our stadium as BCFC no longer own Ashton Gate. From  Begley's post, if VP was owned by a Xia owned company Recon, then the same situation would then have applied to them.

Now Im no accountant or corporate finance expert, so my interpretation might be completely wrong, but can anyone throw more light on this?

 

 

 

Very much looking forward to @Coppello 's take here and on the overall situation!

It's a curious one, but I think Aston Villa Limited owned Villa Park.

I still wonder about that sale and leaseback, seems the hardest to pinpoint of the 5 clubs who have done it- whether it was right or wrong.

Edited March 11, 2020 by Mr Popodopolous

[Davefevs]

6 minutes ago, downendcity said:

Just came across this post from last summer, made by a villa fan.

Obviously we have no way of knowing from what position of knowledge/expertise Begley makes his/her comments, but does it put  the cat among the pigeons, as far as Villa's ffp position last season is concerned?

Our understanding has always been ( continually reinforced with glee by Delta) that Villa Park was "sold" by the football club to another of the owners' companies and the profit thereon was applied to Villa's income, completely within ffp rules and  this enabled them to pass ffp scrutiny. According to Begley's statement, taken  on face value, it seems more to do with addressing Xia's equity position than a sale in the sense that, say, Derby undertook. Also, if the stadium was previously owned by Recon ( a Xia owned company) and if it was sale transaction, then surely the proceeds of sale would be due to Recon and not AVFC.

In a recent post Delta pointed out that perhaps our grievance with Villa is because  we could not enjoy the financial benefit of selling sell our stadium as BCFC no longer own Ashton Gate. From  Begley's post, if VP was owned by a Xia owned company Recon, then the same situation would then have applied to them.

Now Im no accountant or corporate finance expert, so my interpretation might be completely wrong, but can anyone throw more light on this?

 

 

 

We report our Football stuff under Bristol City Holdings which encompass BCFC and Ashton Gate Ltd, so I assume (I’m no expert)  should we sell our ground to Lansdown or Pula, the profit from that sale would come under AGLtd and therefore under the reporting of BCH for FFP purposes?

[downendcity]

2 minutes ago, Mr Popodopolous said:

Very much looking forward to @Coppello 's take here and on the overall situation!

It's a curious one, but I think Aston Villa Limited owned Villa Park.

I still wonder about that sale and leaseback, seems the hardest to pinpoint of the 5 clubs who have done it- whether it was right or wrong.

Could well have been the case, but it's interesting  that a Villa fan, with I presume a bit of financial savvy and knowledge of Villa's financial affairs, categorically states that Villa Park was not sold, as would be allowed within ffp and that he also states that VP was previously owned by Recon, not the football club.

[Mr Popodopolous]

15 minutes ago, downendcity said:

Could well have been the case, but it's interesting  that a Villa fan, with I presume a bit of financial savvy and knowledge of Villa's financial affairs, categorically states that Villa Park was not sold, as would be allowed within ffp and that he also states that VP was previously owned by Recon, not the football club.

Would be worth digging into.

Aston Villa's structure is interesting- here are the basics using CH below...

• NSWE UK- owned directly by the owners since July 2018, ie the takeover- prior to that it was Xia and it was called Recon Group.
• Aston Villa Limited- significant contorl by NSWE UK since April 2016, obviously before then NSWE UK was Recon Group.
• NSWE Stadium Limited- owned by the owners, but according to CH until 16th May 2019 it was owned by AVL. From that date, it was owned directly by the owners.
• NSWE Sports Limited- significant control, NSWE UK (formerly Recon Group).
•  Aston Villa Football Club Limited- Controlled by Aston Villa Limited.
• Aston Villa FC Limited- Controlled by Aston Villa Limited.

One thing that I cannot fathom is why a variety of the company names kept switching and changing under Xia and to an extent the new owners- seems odd. Not saying any wrongdoing but he did love switching names at times! Bit curious, not least as it is the company number that is key here I think.

Each company will show a history of names and dates that name was valid.

Edited March 11, 2020 by Mr Popodopolous

[downendcity]

3 minutes ago, Davefevs said:

We report our Football stuff under Bristol City Holdings which encompass BCFC and Ashton Gate Ltd, so I assume (I’m no expert)  should we sell our ground to Lansdown or Pula, the profit from that sale would come under AGLtd and therefore under the reporting of BCH for FFP purposes?

You could be right Dave.

As I've previously said Im no corporate finance expert, and Recon may well have been the holding company for the football club. Even so, it's confusing that Begley states "There are a few mentions of Villa selling their ground to themselves (like Derby) to pass P&S. Although this is not against the rules albeit not in the spirit of P&S, it is not the case that Villa has sold Villa Park"

Again there might well be a simple explanation from an accounting standpoint, of which I am unaware . The only thing I can think of is whether this is the corporate equivalent of transfer of equity in residential property, such as might occur following divorce, when a couple transfer the matrimonial home from joint names into the sole name of one spouse, who then pays his/her partner a sum for their share of the equity in the property.

However, even if that was the case,  the new owners would be paying Xia, not AVFC, to reduce his equity stake in the football club, so I confess Im still confused.

 

[downendcity]

4 minutes ago, Mr Popodopolous said:

Would be worth digging into.

Aston Villa's structure is interesting- here are the basics below...

• NSWE UK- owned directly by the owners since July 2018, ie the takeover- prior to that it was Xia and it was called Recon Group.
• Aston Villa Limited- significant contorl by NSWE UK since April 2016, obviously before then NSWE UK was Recon Group.
• NSWE Stadium Limited- owned by the owners, but according to CH until 16th May 2019 it was owned by AVL. From that date, it was owned directly by the owners.
• NSWE Sports Limited- significant control, NSWE UK (formerly Recon Group).
•  Aston Villa Football Club Limited- Controlled by Aston Villa Limited.
• Aston Villa FC Limited- Controlled by Aston Vailla Limited.

One thing that I cannot fathom is why a variety of the company names kept switching and changing under Xia and to an extent the new owners- seems odd. Not saying any wrongdoing but he did love switching names at times!

[Mr Popodopolous]

Putting aside ownership changes, it appears that:

Quote

NSWE UK.

From 12th May 2016 to 13th July 2017 was Recon Sports Limited.

From 13th July 2017 to 9th October 2019 was Recon Group UK Limited.

Obviously is now NSWE UK, new owners etc- maybe it heralded the end of Xia's involvement in any capacity there? Those two names were under Xia.

Quote

NSWE Sports Limited.

13th July 2017 to 9th October 2017  was Recon Acquisitions Limited.

9th October 2017 to 9th October 2019 was Recon Sports Limited.

As above, NSWE- new owners etc.

Quote

Aston Villa Limited

Inherited as Aston Villa Limited and stayed that way until...

7th August 2017 to 9th October 2017 was Recon Sports Limited.

9th October 2017 to 23rd March 2019 was Recon Football Limited.

On 23rd March 2019 it reverted back to Aston Villa Limited- and so it remains.

Quote

NSWE Stadium Limited

Incorporated on 25th July 2017 as Vilden Limited

Name changes to Aston Villa Limited on 7th August and stays that way until 23rd March 2019.

From 23rd March 2019 to 13th May 2019, changes to Recon Football Limited.

As above, NSWE new owners etc.

What I don't get is why all the name changes- the last two in March 2019 fell into it a bit when new owners owned but Xia was still involved.

Edited March 11, 2020 by Mr Popodopolous

[Delta]

34 minutes ago, downendcity said:

Just came across this post from last summer, made by a villa fan.

Obviously we have no way of knowing from what position of knowledge/expertise Begley makes his/her comments, but does it put  the cat among the pigeons, as far as Villa's ffp position last season is concerned?

Our understanding has always been ( continually reinforced with glee by Delta) that Villa Park was "sold" by the football club to another of the owners' companies and the profit thereon was applied to Villa's income, completely within ffp rules and  this enabled them to pass ffp scrutiny. According to Begley's statement, taken  on face value, it seems more to do with addressing Xia's equity position than a sale in the sense that, say, Derby undertook. Also, if the stadium was previously owned by Recon ( a Xia owned company) and if it was sale transaction, then surely the proceeds of sale would be due to Recon and not AVFC.

In a recent post Delta pointed out that perhaps our grievance with Villa is because  we could not enjoy the financial benefit of selling our stadium as Villa has,  because BCFC no longer own Ashton Gate. From  Begley's post, if VP was owned by a Xia owned company Recon, then surely Villa were in the same position

Now Im no accountant or corporate finance expert, so my interpretation might be completely wrong, but can anyone throw more light on this?

 

 

 

I do not post anything with "glee".  Let's get that straight.  I try to post facts in a constructive manner.  I may not post what you all want to read but nevertheless, the arguments are constructive.

I don't believe that there was any need to dilute Xia's shareholding - He was finished at the club the day NS & WE took over.  I also don't believe that Begley was/is correct.  The accounts show that VP was sold by the club (Aston Villa Ltd) to NSWE stadium Ltd.  Without that transaction taking place, Villa would have fallen foul of FFP and that is the reason the ground was sold.

[Mr Popodopolous]

One more thought on the overall FFP system. Maybe it already works like this or should, but the EFL have not been enforcing it properly,

Once the precedent set ie points off, for a club, then it is relatively easy in theory to dock points for in-season 3rd year  failures. Simply point at the tariff and sliding scale- aggravating and mitigating factors are less clear cut but if a club is over by x, do you even need an Independent Disciplinary Commission? Just dock them the points in line with their FFP adjusted overspend between 1st March and the end of the season. Also a rule that all such transactions ie ground sales etc have to be in place by the time of the submission dates wouldn't go amiss either. I just wonder why they generally happened quite late in the Reporting Period, in all 3 cases- I say 3, there were 5 but neither Birmingham or it seems/I assume Reading have bothered or needed to register the sales.

Overspend in Projected Accounts is or should be treated as being in breach verbatim.

If Projected Accounts are demonstrably proven to be false after the event, then severe penalties should follow for any club submitting knowingly false projections, in addition to the FFP one- IMO of course.

Worth reading the blogger Al Majir from 2018, he seems or seemed to know things about what was going on behind the scenes with FFP. Had snippets anyway.

We do know though in general that Shaun Harvey wasn't that interested in- or maybe capable of- serious governance at the EFL. You only have to look at the number of clubs charged with not paying wages now...well it happened often last season too and what did the EFL headed up by him do about it?? That alone is a major difference.

That's the strange thing though, I've seen him described periodically as a talented and capable administrator who knows the business significantly or words to that effect- understanding his inaction or poorly handled actions/bungling on many issues is difficult based on that- then again Leeds in admin twice, Bradford once, he was Secretary at Scarborough too- wonder if anything went wrong there under him!!

Talented and capable at leading sides into administration!

I suppose with his track record he should at least know how way around the process, any port in a storm etc.

Edited March 11, 2020 by Mr Popodopolous

[Lrrr]

On 10/03/2020 at 15:46, Mr Popodopolous said:

They need to find a way to expedite the process, legally speaking

No idea of the legality but could they change it so burden of proof is on proving you've complied rather than being found to have broken? I'm sure clubs would act a hell of a lot quicker if there was a deadline for having to prove they've complied or the EFL can punish them based on what they accuse them of having done (ie exceeded FFP by x million over 3 years)

[reddoh]

6 hours ago, Davefevs said:

We report our Football stuff under Bristol City Holdings which encompass BCFC and Ashton Gate Ltd, so I assume (I’m no expert)  should we sell our ground to Lansdown or Pula, the profit from that sale would come under AGLtd and therefore under the reporting of BCH for FFP purposes?

we cant sell our ground we have already done it so if the club folded the ground is still ours but not sure after the rebuild 

[Mr Popodopolous]

2 hours ago, reddoh said:

we cant sell our ground we have already done it so if the club folded the ground is still ours but not sure after the rebuild 

I'd have to double check of course

Lot of accounts to go through, but was it sold as such or was it an asset transfer? Which one we report as our FFP figures to the EFL I'm also unsure on- BCFC Holdings in some ways would make sense but...

The latter point, surely as the ultimate company ie the consolidated accounts, such a transaction can cancel out ie no net gain- maybe that's old rules though?

Asset transfer tends to be at book value or no profit- don't think we profited at all from it but again accounts would reveal all...

Very quick look tells me that it happened sometime in 2005/06 season- Bristol City Football Club Limited accounts made up to 31st May 2006.

Transferred to Ashton Gate Limited- on Bristol City Football Club Limited accounts for that season, check note 8 on Page 13.

Unlike ANY of these transactions, we made zero profit- it was transferred at the price it was on the books. As it should be, unless of course accounting regs stipulated something different then vs now- by which I mean could do it then but not now, would have to be at fair value etc.

Course there's Pula Sport and Pula Limited but I'm just focusing on the easily accessible by CH- was an asset transfer, not a sale as such.

Edited March 12, 2020 by Mr Popodopolous

[Davefevs]

12 hours ago, reddoh said:

we cant sell our ground we have already done it so if the club folded the ground is still ours but not sure after the rebuild 

We could sell our ground to any Tom, Dick or Harry, surely?  I don’t believe we have sold it, just transferred it into a different part of the company structure as @Mr Popodopolous states above.

[Bristol Rob]

Haven't followed this thread as closely as some, but I was just wondering that if there was no promotion/relegation this season if any clubs have gambled on success and are/were in danger of achieving it, or has it mostly been a case of people trying to balance the books this year.

[Mr Popodopolous]

Off the top of my head.

Think Reading must be in danger...unless there is some major item in their accounts that we aren't aware of yet.

Already sold the ground and their profit in 2016/17 will drop off...they looked to sell it at market rates I am sure because the profit was nothing like the big 3- Aston Villa, Derby and Sheffield Wednesday- but when released from a soft embargo they swiftly (within a month anyway) purchased Puscas and Joao!!

Birmingham maybe, albeit a small breach so a small penalty- bit of an unknown- or they might be fine this time to June 2020.

We already have the existing Derby, Sheffield Wednesday cases- who knows if a rolling breach would see them fail last and this season too.

Think Blackburn in a tight spot but okay as of now, ie to June 2020 or whenever their Reporting Period finishes- Stoke could be tough going into next (if we have a next!) season. Noises coming out of Stoke make me think they could try some accounting tricks.

Bit less at risk, Nottingham Forest- maybe but they've sold quite well this season. QPR have some headroom but the end of parachute payments this season won't help- should be fine in both cases for this season though.

Also worth noting that equity limits change things...if equity stuck in it's £13m per season, equity up to £8m, if not it's £5m- but that could literally be anything between £1-8m of equity- ie £1 as opposed to £1m, so you stick a pound in it's £5m + £1 and so on.

There's one big unknown of course- whether Aston Villa will face scrutiny as and when they come back! I fear they are fine but...

Their club statement says they have complied with EFL regulations but there are a few unknowables:

1. Like with Derby and Sheffield Wednesday, they- especially Derby- were clearly considered fine when Shaun Harvey ran the show. Rick Parry seems much different! Derby even put out a statement last September stating that they had complied...
2. Still with those 2 clubs, will they- and the bulk of the compliant division- accept Aston Villa not getting any proper EFL scrutiny- both of those got charged well after the event for a start once further investigations uncovered things.
3. Can someone- anyone- explain to me how Loans Receivable which was how the Villa Park Sale and leaseback was done, can count as profit under the regulations?

Dunno if they offset loans to the equivalent of the sale price and in return got Villa Park? Seems very sketchy from a regulatory POV.

Edited March 13, 2020 by Mr Popodopolous