Financial Fair Play

[Green]

people who don't know what theyre doing

The worst kind of people.

Although I try and give them some slack, it can happen to best of us

[paddy20]

people who don't know what theyre doing could easily look at the situation after the play off and think that this team and manager, Plus 17 million pounds worth of new players = promotion and its therefore worth the gamble.
Is was not.

Well thats true and clubs like bournemouth got away with it as they got promoted and the FFP rules weren't so strictly adhered to then.

[sandman]

The great Financial Fair Play con in full swing. Don't be surprised if the owners decided to walk away.

[Hendo]

The great Financial Fair Play con in full swing. Don't be surprised if the owners decided to walk away.

I'd be very surprised if they walked away

[Maneki Neko]

The great Financial Fair Play con in full swing. Don't be surprised if the owners decided to walk away.

who is the conman in this conspiracy theory?
the FA/league for bringing in FFP rules?
or are you saying the owners are pretending they have to adhere to FFP rules so they don't have to spend money?

[biff]

https://twitter.com/uglygame/status/1141232038474858496

Succinct thread from the brilliant Martin Calladine. We're not looking too healthy.

[Greatwesternline]

I’m fully expecting the club to take another hard line, as we did in January, to get players out.

Gourlay has caused long lasting damage to this club, and needs must.

The likes of Gunter, perhaps McCleary, need to move on. Big earners and neither required or as useful to us as they once were. Kelly another big earner can go. He clearly doesn’t fit into Jose’s team.

My early pre-season optimism has all but gone for now. It’s hard to see us bringing Oliveira back under these conditions. He must be a £3-4m fee. With a bit of luck Norwich will allow us to spread the fee over 2-3 years but if not I can’t see it happening.

The big summer for the young lads may have just got a lot bigger!

Just a note on "spreading costs over 2-3 years. That happens anyway. FFP relates to your accounting losses, not cashflow. When you buy a player, you spread the cost over the length of the contract, not when you buy him. We have no reported cashflow problem, just an allowed accounting loss problem. In addition, when you sell a player, you don't recognise all of that cash as profit. Its only profit above what you have them valued for in your books.

Example, buy aluko for 8 million on 4 year deal.
After 2 years, he is worth 4 million in your books because you have written down (amortised) his contract by two years worth of £2m a year, his purchase has so far cost you £4m in your accounts.
If you sell him for £1m after 2 years, you've not helped bring £1m in, you have crystalised a £3m loss. Which makes your FFP look even worse.

This is true. FFP Accounts are not the same as Club Accounts.

Weirdly, that may be why players were given 4 years contract to begin with.
Buy a player for £8mill and pay him 15k a week for 4 years. Cost £2.75 mill per year (FFP).
Buy a player for £5mill and give him a 2 year contract of 0.5 mill a year (10K a week) - FFP cost - £3 million per year!

Note that it also means from an FFP point of view, players that came in on a free, or signed extensions after their original contract expired (e.g., Gunter, McCleary) don't have a cost, other than their salaries, on the books. So if you sell one of them for £250K, that is actually £250K FFP profit. Can't remember how much Blackett cost (£2m?) but his worth will have been written down over the last 3 years of a 4 year contract. So selling him for anything over a quarter of what we paid for him is FFP profit.

I reckon players brought in for free have signing on fees which are capitalised, not 100% sure though. Any football accountants out there no the accounting treatment for player signing on fees!?

#nichechat

[muirinho]

Just a note on "spreading costs over 2-3 years. That happens anyway. FFP relates to your accounting losses, not cashflow. When you buy a player, you spread the cost over the length of the contract, not when you buy him. We have no reported cashflow problem, just an allowed accounting loss problem. In addition, when you sell a player, you don't recognise all of that cash as profit. Its only profit above what you have them valued for in your books.

Example, buy aluko for 8 million on 4 year deal.
After 2 years, he is worth 4 million in your books because you have written down (amortised) his contract by two years worth of £2m a year, his purchase has so far cost you £4m in your accounts.
If you sell him for £1m after 2 years, you've not helped bring £1m in, you have crystalised a £3m loss. Which makes your FFP look even worse.

This is true. FFP Accounts are not the same as Club Accounts.

Weirdly, that may be why players were given 4 years contract to begin with.
Buy a player for £8mill and pay him 15k a week for 4 years. Cost £2.75 mill per year (FFP).
Buy a player for £5mill and give him a 2 year contract of 0.5 mill a year (10K a week) - FFP cost - £3 million per year!

Note that it also means from an FFP point of view, players that came in on a free, or signed extensions after their original contract expired (e.g., Gunter, McCleary) don't have a cost, other than their salaries, on the books. So if you sell one of them for £250K, that is actually £250K FFP profit. Can't remember how much Blackett cost (£2m?) but his worth will have been written down over the last 3 years of a 4 year contract. So selling him for anything over a quarter of what we paid for him is FFP profit.

I reckon players brought in for free have signing on fees which are capitalised, not 100% sure though. Any football accountants out there no the accounting treatment for player signing on fees!?

#nichechat

ah yes, that's true, I'd forgotten. Any costs associated with acquiring the player's registrations (including the parasite payments to the agent) would be capitalised as fixed assets, and then amortised over the length of the contract. So that would include sign-on bonuses.

So players on a free aren't really free. Cheaper, though.

[linkenholtroyal]

Does anyone else know other than us and Wednesday who else is under this soft embargo. weirdly it could work slightly in our favour if 5 or 6 teams are in the same situation. We have a strong youth system which other teams cant say they do. atleast we can replace gaps with good youth players and still field a team. I dont know what Wednesdays U23s are like are they in a worse boat than we are.

[Wallsy]

According to our fitness coach (for some unknown reason he decided to respond to a fan account on Twitter called Reading FC Bible) he said if we sell a player for £5m we can spend £5m on a new player(s). The tweet was pulled an hour or so later after some fans advised it could get the coach in trouble.

He (Rui) is on Instagram - rui_fix2move

[paddy20]

According to our fitness coach (for some unknown reason he decided to respond to a fan account on Twitter called Reading FC Bible) he said if we sell a player for £5m we can spend £5m on a new player(s). The tweet was pulled an hour or so later after some fans advised it could get the coach in trouble.

He (Rui) is on Instagram - rui_fix2move

That makes sense

[El Diablo]

https://twitter.com/uglygame/status/1141232038474858496

Succinct thread from the brilliant Martin Calladine. We're not looking too healthy.

So, regurgitating a Lowe piece, with added on inacuracies ( failed to pay the players - not true - it was due to a HK Bank Holiday admin screw up) is hardly a ground breaking piece of journalism.

All that said - we all know we're sailing close to the wind, and we all know there will be Financially creative ways to ease this situation.

For instance, I note that Forest have sold one of their (underpar) players to Olympiakos ( both who share the same owner)

https://www.bbc.co.uk/sport/football/48683133

[maffff]

https://twitter.com/uglygame/status/1141232038474858496

Succinct thread from the brilliant Martin Calladine. We're not looking too healthy.

Is it really? It's pretty lazy - and now I've stupidly engaged with him on twitter. Shouldn't argue with fools, only brings me down to their level.

[Hound]

https://twitter.com/uglygame/status/1141232038474858496

Succinct thread from the brilliant Martin Calladine. We're not looking too healthy.

Is it really? It's pretty lazy - and now I've stupidly engaged with him on twitter. Shouldn't argue with fools, only brings me down to their level.

yeah, rare agreed.

[biff]

https://twitter.com/uglygame/status/1141232038474858496

Succinct thread from the brilliant Martin Calladine. We're not looking too healthy.

Is it really? It's pretty lazy - and now I've stupidly engaged with him on twitter. Shouldn't argue with fools, only brings me down to their level.

tbf reading the tête-à-tête, he's had your pants down.

[maffff]

Not at all. Only got the last word (presumably) as he blocked me.

[biff]

I blocked you years ago.

[tidus_mi2]

I read that guy's responses and he doesn't say anything substantial and seems to want to make a big deal of that one week we missed payroll which was quickly rectified. Just a waste of space trying to sound dramatic imo.

[Wallsy]

So we heard last week that we promised the EFL we will sell players before the end of the month. I didn’t realise the significance of the end of the month, but some fans seem to think that means a refresh of FFP for the new season. Is that true? And if it is, and if we aren’t able to sell anyone or enough before the close of the month, I wonder what sort of penalty we could be in for?

Yikes!

[Hound]

End of the season sounds about right. Contracts run to June

Very much doubt anything will happen if we haven’t sold anyone by then. We can’t make clubs buy our players and clearly working with the EFL as a mitigation