Financial Fair Play / Profit & Sustainability

[TRC]

4 minutes ago, Ghandis Flip-Flop said:

So just off the top of my head there’s roughly £16m more prize money for finishing fourth over 11th (2.3 million per place), our TV revenue was up massively last season compared to previous years. The additional revenue from the league cup run and the SELA shirt sponsorship, not to mention the other announced smaller deals.

 

i wouldn’t be worrying about us being able to spend in the summer or ending up over our FFP limit.

Did not factor in us moving up in the league. Ok my shit maths has us at 120m needing a 15m sale between now and June 30th.

 

Alternatively a referee not to give a shit pen in the last minute vs PSG would also help.

[Ghandis Flip-Flop]

Just now, timeEd32 said:

 

I think you're still mixing up accounting years and playing years and what's included in what.

 

But I agree that of all the worrying things this is not one to add to the list. We've been consistent in our intent to abide by FFP and all related rules and we are not run by morons. 

Well tbf I’m unsure when prize money for finishing place and the variable aspect of the TV appearance money is received by the club in relation to accountancy years. But then unless we have a club accountant on the forum I doubt anybody else knows either ?

 

[timeEd32]

1 minute ago, Ghandis Flip-Flop said:

Well tbf I’m unsure when prize money for finishing place and the variable aspect of the TV appearance money is received by the club in relation to accountancy years. But then unless we have a club accountant on the forum I doubt anybody else knows either ?

 

 

We do know because it's in the accounts. 4th place and the League Cup run are both called out as reasons for additional revenue in 2022/23. So, as of now, we are on track for less PL revenue for 23/24 but offset by Sela, UCL, and player sales.

[Colos Short and Curlies]

4 minutes ago, Ghandis Flip-Flop said:

Well tbf I’m unsure when prize money for finishing place and the variable aspect of the TV appearance money is received by the club in relation to accountancy years. But then unless we have a club accountant on the forum I doubt anybody else knows either ?

 

you’d recognise the prize money and to money in the season that it is earned. The financial year ends after the season does so it fits in nicely.

 

ignore when you get the cash, it’s when you earn it that’s important. Same with tv money, whatever the final amount is for the season gets recognised then.

 

 

Edited January 16 by Colos Short and Curlies

[TRC]

2 minutes ago, Colos Short and Curlies said:

you’d recognise the prize money and to money in the season that it is earned. The financial year ends after the season does so it fits in nicely.

 

ignore when you get the cash, it’s when you earn it that’s important. Same with tv money, whatever the final amount is for the season gets recognised then.

 

 

 

Makes sense.

 

Not sure how we can drop our operating losses by 70m or so then.

[RodneyCisse]

How in line are Forests charges with Everton’s?

[TRC]

Just now, RodneyCisse said:

How in line are Forests charges with Everton’s?

Full details havent been released I dont think.

[TRC]

6 minutes ago, TRC said:

Makes sense.

 

Not sure how we can drop our operating losses by 70m or so then.

Although owners can right off 90m of the 105m through buying shares? Can we not just do that?

[leffe186]

The latest Athletic podcast covers this reasonably well:

 

https://theathletic.com/podcast/144-athletic-football-podcast/

[Abacus]

Just now, TRC said:

Makes sense.

 

Not sure how we can drop our operating losses by 70m or so then.

Operating losses are only the starting point. 

 

From there, certain things are and are not allowable from a PSR point of view, after that you get to an adjusted losses figure.

 

You'd only start to worry about the first number if your owners couldn't make that good and there was a chance of your club going bust. That's not our situation.

 

What we don't know is the allowable (adjusted) loss, i.e. what counts before you breach and which also determines what you therefore can spend.

 

You can make an educated guess if you know what you're looking for. But in short, I wouldn't fret about it.

[leffe186]

1 minute ago, TRC said:

Although owners can right off 90m of the 105m through buying shares? Can we not just do that?

I really think you’ll be fine with the increased revenue. You won’t be able to spend as much as you have been, but you’ll still be able to strengthen the squad and cut off some dead wood.

[et tu brute]

6 minutes ago, TRC said:

Makes sense.

 

Not sure how we can drop our operating losses by 70m or so then.

I guarantee you now that we will not only be ok FFP wise, but there will be signings coming in this summer. The owners will ensure that sponsorship is spread out to keep revenue income increasing year on year. I also think none of out top players will be sold this summer (unless Madrid or Barcelona meet Bruno's buy out clause) or a stupid fee comes in from other clubs. More likely to see the sale of the likes of Longstaff, Wilson and Murphy added to some of the dead wood we have. 

[Abacus]

4 minutes ago, RodneyCisse said:

How in line are Forests charges with Everton’s?

From what I understand, Everton's differ mainly in the treatment on interest on debts for stadium redevelopment, which Everton thought were allowable.

 

Forest seems more cut and dried re it being purely transfer / wage overspending (which was a part of Everton's problem too).

 

Both argue that they'd kept the PL informed all along and had assets to sell to make the losses good, but were shafted anyway.

[ikri]

13 minutes ago, TRC said:

Makes sense.

 

Not sure how we can drop our operating losses by 70m or so then.

 

Won't be the full 70m but there'll be a ton of additional commercial income to add this year beyond the Sela sponsorship and kit deals.  Existing sponsors will likely have paid more due to increased exposure from European football, additional minor sponsors will have been added, etc.  Our commercial income under Ashley was a joke, it barely increased at all under his entire ownership, fixing that to sign improved deals will have been right at the top of the to do list when PIF took over.

[brummie]

7 minutes ago, ikri said:

 

Won't be the full 70m but there'll be a ton of additional commercial income to add this year beyond the Sela sponsorship and kit deals.  Existing sponsors will likely have paid more due to increased exposure from European football, additional minor sponsors will have been added, etc.  Our commercial income under Ashley was a joke, it barely increased at all under his entire ownership, fixing that to sign improved deals will have been right at the top of the to do list when PIF took over.

 

Both you and us managed, for about a decade plus, to have flat commercial income whilst, most of the time, being members of an organisation which was fundamentally a licence to print money.

 

Mind blowing.

 

To be fair to Spurs - and, believe me, that is not something I ever like to do, let alone admit to it - they've played it very well in terms of growing commercial income, the new stadium etc. 

 

I do sometimes look at their crowd (ie the people, not the numbers) and wonder, when Son goes or retires, and those thousands and thousands of Koreans stop going to their games, how that'll impact them.

 

Son is an absolute mega star in South Korea. I reckon on any given Spurs match day, they could sell 40,000 tickets to his co-nationals on holiday in the capital.

 

 

Edited January 16 by brummie

[duo]

Not sure if posted..

 

 

[Colos Short and Curlies]

Every club has the same accounting period and there is no reason why the Premier League cannot mandate that accounts are filed with them within 90 days (or lets just say 30th September). They can also mandate certain accounting rules to be followed where there is usually discretion.

With these accounts clubs need to submit a forecast for the season based on any known increases to TV money, competitions you are in, sponsorship deals coming into play and player trading in the summer transfer window

 

You can then base FFP calcs on the the season just gone, the season before and the current season with a weighting of say (using 2022/2023 as the reference point) 20% 2021/2022, 50% 2022/2023, 30% 2023/2024.

 

So that allows for scenarios such as qualifying for the Champions League, holding out for a better price on player sales etc. whilst still maintaining a degree of control to stop excessive spending.

 

Lots to work out in the middle for what the FFP calculations cover but this would be a start for reform imo. You could also then set deadlines within the season for charges and decisions to be made for breaches in a realistic timeframe. Basically any naughty behaviour should be dealt with by Christmas

[timeEd32]

Dropping this here as it's relevant to the discussion earlier (summary of our accounting years and the 3 year periods): 

 

[TheBrownBottle]

15 hours ago, brummie said:

 

Both you and us managed, for about a decade plus, to have flat commercial income whilst, most of the time, being members of an organisation which was fundamentally a licence to print money.

 

Mind blowing.

 

To be fair to Spurs - and, believe me, that is not something I ever like to do, let alone admit to it - they've played it very well in terms of growing commercial income, the new stadium etc. 

 

I do sometimes look at their crowd (ie the people, not the numbers) and wonder, when Son goes or retires, and those thousands and thousands of Koreans stop going to their games, how that'll impact them.

 

Son is an absolute mega star in South Korea. I reckon on any given Spurs match day, they could sell 40,000 tickets to his co-nationals on holiday in the capital.

 

 

 

It won’t impact their attendances.  Spurs historically have the fourth highest average in English football.

 

For comparison, Newcastle have the fifth and Villa the ninth highest.  

[et tu brute]

12 minutes ago, TheBrownBottle said:

It won’t impact their attendances.  Spurs historically have the fourth highest average in English football.

 

For comparison, Newcastle have the fifth and Villa the ninth highest.  

They do if you compare the full history of the clubs. If you take it only from when Tottenham were formed that's not the case. We have a higher average.

[TheBrownBottle]

3 minutes ago, et tu brute said:

They do if you compare the full history of the clubs. If you take it only from when Tottenham were formed that's not the case. We have a higher average.

Yep, true.  Though I don’t think they’ll have trouble selling tickets. 

[pubteam]

If we do end up following the uefa financial fair play model going forward I take it this is better for us? 

[Ghandis Flip-Flop]

Just now, pubteam said:

If we do end up following the uefa financial fair play model going forward I take it this is better for us? 

No, it’s more stringent for everybody, will end up with the max spend (Wages and Transfers) being 70% of turnover.

[pubteam]

Just now, Ghandis Flip-Flop said:

No, it’s more stringent for everybody, will end up with the max spend (Wages and Transfers) being 70% of turnover.

I thought it was just wages, oh well that's a bit shit.

[Ghandis Flip-Flop]

Just now, pubteam said:

I thought it was just wages, oh well that's a bit shit.

From UEFA's website

 

The regulations see clubs subject to squad cost controls for the first time. The cost control rule limits spending on player and coach wages, transfers, and agent fees to 70% of club revenue – the gradual implementation will see the percentage at 90% in 2023/2024, 80% in 2024/2025, and 70% as from 2025/2026. This requirement provides a direct measure between squad costs and income to encourage more performance-related costs. Assessments will be performed on a timely basis and breaches will result in pre-defined financial penalties as well as sporting measures.

 

 

My worry is this has a similar thought behind it as the current political idiocy that is perpetual economic growth, it may be difficult to grow revenues sufficiently to maintain position, and how many teams are going to be forced to sell players to reduce that ratio by 10% year on year. Also where does the other 30% go? What is the point of making profits if they aren’t able to be reinvested, without incurring "pre-defined financial penalties as well as sporting measures"?