Finance

377 posts
User avatar
Sutekh
Hob Nob Addict
Posts: 9357
Joined: 12 Feb 2014 14:05
Location: Undiscovered pyramid somewhere in Egypt

Re: Finance

by Sutekh » 02 Jun 2020 13:50

STAR Liaison From the STAR website:

An important news story for football fans broke Friday 22nd May – and was immediately buried by the Dominic Cummings controversy. It was another political DC, Damian Collins MP and until recently the Chair of the Digital, Culture, Media and Sport select committee, doing the talking.

He sees a massive financial crisis hitting EFL clubs within a couple of months. No revenue coming in from games, 2020-21 season ticket sales hit by Covid-19 uncertainties and the knock-on effects of the Football Creditors rule. He’s not alone in predicting the demise of several, unspecified, clubs.

Collins is proposing a deal. The government is already supporting Rugby League in this crisis to the tune of £16 million. Collins’ six-point plan for football goes further.

- He proposes setting up a Football Finance Authority (FFA), under the auspices of the Football Association (FA).
- The FFA would assist financially troubled EFL clubs with public money. In exchange for those funds such clubs would surrender a minority shareholding.
- Independent directors would be nominated to represent that shareholding. These directors could be nominated by supporters’ trusts or local councils.
-These directors would have access to real time financial records and be duty-bound to raise any concerns they have about the club’s financial sustainability to the FFA.
- At some future point when the financial crisis has abated these minority shareholdings could be offered for sale to supporters’ trusts or local councils at a discounted rate with the funds raised going to back to the government to repay the public money invested.
- The EFL’s financial regulations would be enforced by the FFA (rather than the EFL club owners as at present) and the FFA would include representation of EFL clubs, PFA and the Football Supporters Association (FSA).
- The Covid-19 crisis comes on top of examples of creative accounting and unsustainable wages in the Championship where wages exceed revenue. In 2018-19 wages at Reading were double the revenue. Collins argues that Championship clubs should conform to the same Salary Cap Management Protocol that apply in Leagues One and Two (wages not to exceed 60% of revenue).

It might seem to many fans that STAR and the like have been talking about these issues for years and nothing happens. But we’d say, as with safe standing, there is slow and cautious (too cautious) progress being made. This present government has a manifesto commitment to ‘a fan-led review of football governance’ and the FSA has recently, and for the first time, presented strategic proposals to the FA Board. As the old, and questionable, British Rail slogan had it, ‘we’re getting there’.

What does this mean for Reading fans?

Firstly, STAR is backing Damian Collins’ proposals as is the FSA. We believe they will be good for professional football as a whole.

Secondly, STAR encourages individual STAR members and Reading fans to back these proposals by writing / emailing their MP (help on doing this can be found at How to contact your MP). Or by circulating Collins’ proposals or this message via social media.

Thirdly, wearing our Reading hats, we simply don’t know how the financial crisis will affect our club. As far as we know the owner is willing and able to continue funding the club even though we are in a period of considerable financial losses and strains. If the club does take public money to help through the short-term crisis then yes STAR would be willing to step up as the steward of any reciprocal minority shareholding. However, it has to be said that the history of independent, or supporter-, directors is not always a happy and glorious one.

Fourthly, we’ve had ten or so weeks of no football and not much news about football. We fear this might be the calm before the storm. This could be a pivotal moment in the game’s survival – or re-birth – on a more sustainable level. At STAR we will try and keep on the case, for the good of our club and the game at large. Please continue to join us at http://www.star-reading.org

- As you might have noticed on the STAR board STAR is offering to roll-over membership for the 2020-21 season for free to 2019-20 members, instead of the usual £10, but you have to opt in to take advantage. Full details on the STAR website.


Just playing devils advocate here. While I think the above is great (and would hopefully lead to similar situation for PL clubs), why should the government give public money to any club if they do not do the same for other private businesses which are obviously a source of employment for a great many people earning a hell of a lot less than footballers/managers etc.

User avatar
STAR Liaison
Hob Nob Regular
Posts: 1294
Joined: 14 Apr 2004 09:58

Re: Finance

by STAR Liaison » 02 Jun 2020 15:00

Sutekh
STAR Liaison From the STAR website:

An important news story for football fans broke Friday 22nd May – and was immediately buried by the Dominic Cummings controversy. It was another political DC, Damian Collins MP and until recently the Chair of the Digital, Culture, Media and Sport select committee, doing the talking.

He sees a massive financial crisis hitting EFL clubs within a couple of months. No revenue coming in from games, 2020-21 season ticket sales hit by Covid-19 uncertainties and the knock-on effects of the Football Creditors rule. He’s not alone in predicting the demise of several, unspecified, clubs.

Collins is proposing a deal. The government is already supporting Rugby League in this crisis to the tune of £16 million. Collins’ six-point plan for football goes further.

- He proposes setting up a Football Finance Authority (FFA), under the auspices of the Football Association (FA).
- The FFA would assist financially troubled EFL clubs with public money. In exchange for those funds such clubs would surrender a minority shareholding.
- Independent directors would be nominated to represent that shareholding. These directors could be nominated by supporters’ trusts or local councils.
-These directors would have access to real time financial records and be duty-bound to raise any concerns they have about the club’s financial sustainability to the FFA.
- At some future point when the financial crisis has abated these minority shareholdings could be offered for sale to supporters’ trusts or local councils at a discounted rate with the funds raised going to back to the government to repay the public money invested.
- The EFL’s financial regulations would be enforced by the FFA (rather than the EFL club owners as at present) and the FFA would include representation of EFL clubs, PFA and the Football Supporters Association (FSA).
- The Covid-19 crisis comes on top of examples of creative accounting and unsustainable wages in the Championship where wages exceed revenue. In 2018-19 wages at Reading were double the revenue. Collins argues that Championship clubs should conform to the same Salary Cap Management Protocol that apply in Leagues One and Two (wages not to exceed 60% of revenue).

It might seem to many fans that STAR and the like have been talking about these issues for years and nothing happens. But we’d say, as with safe standing, there is slow and cautious (too cautious) progress being made. This present government has a manifesto commitment to ‘a fan-led review of football governance’ and the FSA has recently, and for the first time, presented strategic proposals to the FA Board. As the old, and questionable, British Rail slogan had it, ‘we’re getting there’.

What does this mean for Reading fans?

Firstly, STAR is backing Damian Collins’ proposals as is the FSA. We believe they will be good for professional football as a whole.

Secondly, STAR encourages individual STAR members and Reading fans to back these proposals by writing / emailing their MP (help on doing this can be found at How to contact your MP). Or by circulating Collins’ proposals or this message via social media.

Thirdly, wearing our Reading hats, we simply don’t know how the financial crisis will affect our club. As far as we know the owner is willing and able to continue funding the club even though we are in a period of considerable financial losses and strains. If the club does take public money to help through the short-term crisis then yes STAR would be willing to step up as the steward of any reciprocal minority shareholding. However, it has to be said that the history of independent, or supporter-, directors is not always a happy and glorious one.

Fourthly, we’ve had ten or so weeks of no football and not much news about football. We fear this might be the calm before the storm. This could be a pivotal moment in the game’s survival – or re-birth – on a more sustainable level. At STAR we will try and keep on the case, for the good of our club and the game at large. Please continue to join us at http://www.star-reading.org

- As you might have noticed on the STAR board STAR is offering to roll-over membership for the 2020-21 season for free to 2019-20 members, instead of the usual £10, but you have to opt in to take advantage. Full details on the STAR website.


Just playing devils advocate here. While I think the above is great (and would hopefully lead to similar situation for PL clubs), why should the government give public money to any club if they do not do the same for other private businesses which are obviously a source of employment for a great many people earning a hell of a lot less than footballers/managers etc.


It's a loan, not a gift, and comes with a quid pro quo intended to benefit communities. This helpfully sets a precedent in recognising that football clubs are not normal private businesses but also have other stakeholders and play major roles in their communities in a way that a car-wash or a fitted windows company does not.

User avatar
Sutekh
Hob Nob Addict
Posts: 9357
Joined: 12 Feb 2014 14:05
Location: Undiscovered pyramid somewhere in Egypt

Re: Finance

by Sutekh » 03 Jun 2020 14:13

STAR Liaison
Sutekh
STAR Liaison From the STAR website:

An important news story for football fans broke Friday 22nd May – and was immediately buried by the Dominic Cummings controversy. It was another political DC, Damian Collins MP and until recently the Chair of the Digital, Culture, Media and Sport select committee, doing the talking.

He sees a massive financial crisis hitting EFL clubs within a couple of months. No revenue coming in from games, 2020-21 season ticket sales hit by Covid-19 uncertainties and the knock-on effects of the Football Creditors rule. He’s not alone in predicting the demise of several, unspecified, clubs.

Collins is proposing a deal. The government is already supporting Rugby League in this crisis to the tune of £16 million. Collins’ six-point plan for football goes further.

- He proposes setting up a Football Finance Authority (FFA), under the auspices of the Football Association (FA).
- The FFA would assist financially troubled EFL clubs with public money. In exchange for those funds such clubs would surrender a minority shareholding.
- Independent directors would be nominated to represent that shareholding. These directors could be nominated by supporters’ trusts or local councils.
-These directors would have access to real time financial records and be duty-bound to raise any concerns they have about the club’s financial sustainability to the FFA.
- At some future point when the financial crisis has abated these minority shareholdings could be offered for sale to supporters’ trusts or local councils at a discounted rate with the funds raised going to back to the government to repay the public money invested.
- The EFL’s financial regulations would be enforced by the FFA (rather than the EFL club owners as at present) and the FFA would include representation of EFL clubs, PFA and the Football Supporters Association (FSA).
- The Covid-19 crisis comes on top of examples of creative accounting and unsustainable wages in the Championship where wages exceed revenue. In 2018-19 wages at Reading were double the revenue. Collins argues that Championship clubs should conform to the same Salary Cap Management Protocol that apply in Leagues One and Two (wages not to exceed 60% of revenue).

It might seem to many fans that STAR and the like have been talking about these issues for years and nothing happens. But we’d say, as with safe standing, there is slow and cautious (too cautious) progress being made. This present government has a manifesto commitment to ‘a fan-led review of football governance’ and the FSA has recently, and for the first time, presented strategic proposals to the FA Board. As the old, and questionable, British Rail slogan had it, ‘we’re getting there’.

What does this mean for Reading fans?

Firstly, STAR is backing Damian Collins’ proposals as is the FSA. We believe they will be good for professional football as a whole.

Secondly, STAR encourages individual STAR members and Reading fans to back these proposals by writing / emailing their MP (help on doing this can be found at How to contact your MP). Or by circulating Collins’ proposals or this message via social media.

Thirdly, wearing our Reading hats, we simply don’t know how the financial crisis will affect our club. As far as we know the owner is willing and able to continue funding the club even though we are in a period of considerable financial losses and strains. If the club does take public money to help through the short-term crisis then yes STAR would be willing to step up as the steward of any reciprocal minority shareholding. However, it has to be said that the history of independent, or supporter-, directors is not always a happy and glorious one.

Fourthly, we’ve had ten or so weeks of no football and not much news about football. We fear this might be the calm before the storm. This could be a pivotal moment in the game’s survival – or re-birth – on a more sustainable level. At STAR we will try and keep on the case, for the good of our club and the game at large. Please continue to join us at http://www.star-reading.org

- As you might have noticed on the STAR board STAR is offering to roll-over membership for the 2020-21 season for free to 2019-20 members, instead of the usual £10, but you have to opt in to take advantage. Full details on the STAR website.


Just playing devils advocate here. While I think the above is great (and would hopefully lead to similar situation for PL clubs), why should the government give public money to any club if they do not do the same for other private businesses which are obviously a source of employment for a great many people earning a hell of a lot less than footballers/managers etc.


It's a loan, not a gift, and comes with a quid pro quo intended to benefit communities. This helpfully sets a precedent in recognising that football clubs are not normal private businesses but also have other stakeholders and play major roles in their communities in a way that a car-wash or a fitted windows company does not.


Perhaps any money provided by the government could also be weighted in relation to how active a club is in its local community.

Also excellent to know the tax player will be footing the bill for all the shortfall between what the government puts into a club and what it gets out (still the tax payer will be footing the bill for all the other schemes the government has put in place during these times so probably won’t make much of a difference in the long run). Wonder what happens if minority shareholdings can’t be sold - will that mean Boris rocking up at clubs’ AGMs? :lol:

User avatar
Sutekh
Hob Nob Addict
Posts: 9357
Joined: 12 Feb 2014 14:05
Location: Undiscovered pyramid somewhere in Egypt

Re: Finance

by Sutekh » 24 Jun 2020 13:53

According to today’s EP website, JLow reports

Thankfully from Reading's perspective Financial Fair Play is being waved by the authorities this year so they can breathe a sigh of relief - temporarily at least.


https://www.getreading.co.uk/sport/foot ... s-18467650

Anyone able to dissect what that may actually mean for Reading (and others) does it leave the club worse off or better off or just the same?

User avatar
Snowflake Royal
Hob Nob Super-Addict
Posts: 13269
Joined: 20 Jun 2017 17:51

Re: Finance

by Snowflake Royal » 24 Jun 2020 15:52

Sutekh According to today’s EP website, JLow reports

Thankfully from Reading's perspective Financial Fair Play is being waved by the authorities this year so they can breathe a sigh of relief - temporarily at least.


https://www.getreading.co.uk/sport/foot ... s-18467650

Anyone able to dissect what that may actually mean for Reading (and others) does it leave the club worse off or better off or just the same?

Well, last year will still be taken into account for next season and the one after for FFP, so whilst it means we avoid a fine this season, we've got to do something drastic to avoid it next season given where we appear to be financially.

Now if they just wiped this year from the record for the purpose of FFP that would help us more.

It's hard to see how we can hugely slash our budget and stay competitive. We can't shift the wasters and overpaid because they would have to take a pay cut to move. Just contract expiration isn't going to do it. Especially as we keep making stupid mistakes with long expensive contracts


User avatar
WoodleyRoyal
Hob Nob Regular
Posts: 4028
Joined: 16 Jun 2008 10:49
Location: Dave Royal I'm Coming for you! whats your IP today?

Re: Finance

by WoodleyRoyal » 24 Jun 2020 16:12

Snowflake Royal
Sutekh According to today’s EP website, JLow reports

Thankfully from Reading's perspective Financial Fair Play is being waved by the authorities this year so they can breathe a sigh of relief - temporarily at least.


https://www.getreading.co.uk/sport/foot ... s-18467650

Anyone able to dissect what that may actually mean for Reading (and others) does it leave the club worse off or better off or just the same?

Well, last year will still be taken into account for next season and the one after for FFP, so whilst it means we avoid a fine this season, we've got to do something drastic to avoid it next season given where we appear to be financially.

Now if they just wiped this year from the record for the purpose of FFP that would help us more.

It's hard to see how we can hugely slash our budget and stay competitive. We can't shift the wasters and overpaid because they would have to take a pay cut to move. Just contract expiration isn't going to do it. Especially as we keep making stupid mistakes with long expensive contracts


Just need to sell a prized asset, moore swift puscas or olise maybe two of them. and with the like of mannone gone our second highest earner see if we can push aluko out and with the other who are ooc we will be fine.

User avatar
Snowflake Royal
Hob Nob Super-Addict
Posts: 13269
Joined: 20 Jun 2017 17:51

Re: Finance

by Snowflake Royal » 24 Jun 2020 16:30

WoodleyRoyal
Snowflake Royal
Sutekh According to today’s EP website, JLow reports



https://www.getreading.co.uk/sport/foot ... s-18467650

Anyone able to dissect what that may actually mean for Reading (and others) does it leave the club worse off or better off or just the same?

Well, last year will still be taken into account for next season and the one after for FFP, so whilst it means we avoid a fine this season, we've got to do something drastic to avoid it next season given where we appear to be financially.

Now if they just wiped this year from the record for the purpose of FFP that would help us more.

It's hard to see how we can hugely slash our budget and stay competitive. We can't shift the wasters and overpaid because they would have to take a pay cut to move. Just contract expiration isn't going to do it. Especially as we keep making stupid mistakes with long expensive contracts


Just need to sell a prized asset, moore swift puscas or olise maybe two of them. and with the like of mannone gone our second highest earner see if we can push aluko out and with the other who are ooc we will be fine.

We're supposed to have been on 200%+ of income on wages. It's going to take more than that.

User avatar
Zip
Hob Nob Addict
Posts: 9156
Joined: 30 Dec 2017 16:39

Re: Finance

by Zip » 24 Jun 2020 16:30

Snowflake Royal
Sutekh According to today’s EP website, JLow reports

Thankfully from Reading's perspective Financial Fair Play is being waved by the authorities this year so they can breathe a sigh of relief - temporarily at least.


https://www.getreading.co.uk/sport/foot ... s-18467650

Anyone able to dissect what that may actually mean for Reading (and others) does it leave the club worse off or better off or just the same?

Well, last year will still be taken into account for next season and the one after for FFP, so whilst it means we avoid a fine this season, we've got to do something drastic to avoid it next season given where we appear to be financially.

Now if they just wiped this year from the record for the purpose of FFP that would help us more.

It's hard to see how we can hugely slash our budget and stay competitive. We can't shift the wasters and overpaid because they would have to take a pay cut to move. Just contract expiration isn't going to do it. Especially as we keep making stupid mistakes with long expensive contracts


I think it means the money we splashed out on Puscas and Joao along with a still top heavy squad and declining gates won’t impact upon us for 2019/20 which is just as well but 2018/19 looked like a financial disaster so we remain in deep trouble.

User avatar
Zip
Hob Nob Addict
Posts: 9156
Joined: 30 Dec 2017 16:39

Re: Finance

by Zip » 24 Jun 2020 16:31

Snowflake Royal
WoodleyRoyal
Snowflake Royal Well, last year will still be taken into account for next season and the one after for FFP, so whilst it means we avoid a fine this season, we've got to do something drastic to avoid it next season given where we appear to be financially.

Now if they just wiped this year from the record for the purpose of FFP that would help us more.

It's hard to see how we can hugely slash our budget and stay competitive. We can't shift the wasters and overpaid because they would have to take a pay cut to move. Just contract expiration isn't going to do it. Especially as we keep making stupid mistakes with long expensive contracts


Just need to sell a prized asset, moore swift puscas or olise maybe two of them. and with the like of mannone gone our second highest earner see if we can push aluko out and with the other who are ooc we will be fine.

We're supposed to have been on 200%+ of income on wages. It's going to take more than that.[/quote


We must reduce the squad size this summer. It’s been too large for far too long. Get rid of 9 or 10 and bring in about 4.


Nameless
Hob Nob Addict
Posts: 5908
Joined: 23 Aug 2013 12:25

Re: Finance

by Nameless » 24 Jun 2020 21:03

Zip
Snowflake Royal
Sutekh According to today’s EP website, JLow reports



https://www.getreading.co.uk/sport/foot ... s-18467650

Anyone able to dissect what that may actually mean for Reading (and others) does it leave the club worse off or better off or just the same?

Well, last year will still be taken into account for next season and the one after for FFP, so whilst it means we avoid a fine this season, we've got to do something drastic to avoid it next season given where we appear to be financially.

Now if they just wiped this year from the record for the purpose of FFP that would help us more.

It's hard to see how we can hugely slash our budget and stay competitive. We can't shift the wasters and overpaid because they would have to take a pay cut to move. Just contract expiration isn't going to do it. Especially as we keep making stupid mistakes with long expensive contracts


I think it means the money we splashed out on Puscas and Joao along with a still top heavy squad and declining gates won’t impact upon us for 2019/20 which is just as well but 2018/19 looked like a financial disaster so we remain in deep trouble.


Suspending FFP for one season makes little sense. If anything 2020/2021 will be more disrupted than last season was.
Can’t see how they can apply the rules to the new season either.

User avatar
Zip
Hob Nob Addict
Posts: 9156
Joined: 30 Dec 2017 16:39

Re: Finance

by Zip » 24 Jun 2020 21:21

Nameless
Zip
Snowflake Royal Well, last year will still be taken into account for next season and the one after for FFP, so whilst it means we avoid a fine this season, we've got to do something drastic to avoid it next season given where we appear to be financially.

Now if they just wiped this year from the record for the purpose of FFP that would help us more.

It's hard to see how we can hugely slash our budget and stay competitive. We can't shift the wasters and overpaid because they would have to take a pay cut to move. Just contract expiration isn't going to do it. Especially as we keep making stupid mistakes with long expensive contracts


I think it means the money we splashed out on Puscas and Joao along with a still top heavy squad and declining gates won’t impact upon us for 2019/20 which is just as well but 2018/19 looked like a financial disaster so we remain in deep trouble.


Suspending FFP for one season makes little sense. If anything 2020/2021 will be more disrupted than last season was.
Can’t see how they can apply the rules to the new season either.


I guess it depends upon whether we get back to normality. If we don’t and attendances are impacted then FFP may well be suspended next season too.

User avatar
morganb
Member
Posts: 342
Joined: 31 Jul 2017 12:30

Re: Finance

by morganb » 25 Jun 2020 02:19

http://www.thefa.com/news/2020/jun/24/i ... ished-2406

The PDFs attached to the above article might be of interest - one shows fees paid to agents (we're nowhere near the top of that list) and the other is an itemised list of players. I'm sure someone on here will find a use for these figures.

User avatar
Sutekh
Hob Nob Addict
Posts: 9357
Joined: 12 Feb 2014 14:05
Location: Undiscovered pyramid somewhere in Egypt

Re: Finance

by Sutekh » 25 Jun 2020 13:52

Zip
Nameless
Zip
I think it means the money we splashed out on Puscas and Joao along with a still top heavy squad and declining gates won’t impact upon us for 2019/20 which is just as well but 2018/19 looked like a financial disaster so we remain in deep trouble.


Suspending FFP for one season makes little sense. If anything 2020/2021 will be more disrupted than last season was.
Can’t see how they can apply the rules to the new season either.


I guess it depends upon whether we get back to normality. If we don’t and attendances are impacted then FFP may well be suspended next season too.


Whatever happens clubs will be impacted next season as well.

I expect grounds will be open to fans from the start of next season but with reduced capacity to begin with so season ticket sales should be limited to whatever clubs are allowed by way of a capacity. Presume capacity limits will be calculated based on the 1 metre rule rather than 2 as with other entertainment/hospitality organisations.


User avatar
Zip
Hob Nob Addict
Posts: 9156
Joined: 30 Dec 2017 16:39

Re: Finance

by Zip » 25 Jun 2020 19:03

Sutekh
Zip
Nameless
Suspending FFP for one season makes little sense. If anything 2020/2021 will be more disrupted than last season was.
Can’t see how they can apply the rules to the new season either.


I guess it depends upon whether we get back to normality. If we don’t and attendances are impacted then FFP may well be suspended next season too.


Whatever happens clubs will be impacted next season as well.

I expect grounds will be open to fans from the start of next season but with reduced capacity to begin with so season ticket sales should be limited to whatever clubs are allowed by way of a capacity. Presume capacity limits will be calculated based on the 1 metre rule rather than 2 as with other entertainment/hospitality organisations.


Yep agreed.

Linden Jones' Tash
Member
Posts: 301
Joined: 20 Jun 2009 12:03
Location: north of the river...

Re: Finance

by Linden Jones' Tash » 02 Jul 2020 10:05


User avatar
tidus_mi2
Hob Nob Regular
Posts: 3978
Joined: 15 Jun 2012 15:24

Re: Finance

by tidus_mi2 » 02 Jul 2020 10:11

Linden Jones' Tash https://twitter.com/KieranMaguire/status/1278592299778428931?s=19

New shares issued

Two points I would take from that:

1) Worrying that we still need this level of cash injected into the club.
2) Comforting that the owners are still willing to put their money into the club.

User avatar
Franchise FC
Hob Nob Addict
Posts: 5038
Joined: 22 May 2007 16:24
Location: The Frozen North

Re: Finance

by Franchise FC » 03 Jul 2020 14:13

tidus_mi2
Linden Jones' Tash https://twitter.com/KieranMaguire/status/1278592299778428931?s=19

New shares issued

Two points I would take from that:

1) Worrying that we still need this level of cash injected into the club.
2) Comforting that the owners are still willing to put their money into the club.


Can't see whether any cash has been injected from that.
It's possible that the shares have been issued but not paid up.

377 posts

Who is online

Users browsing this forum: Google Adsense [Bot], Vision, windermereROYAL and 36 guests

It is currently 03 Jul 2020 14:52