prowl Posted January 23, 2018 Share Posted January 23, 2018 1 hour ago, HarrowbyOwl said: Is this other people's understanding of the point about the club being worse off if we sell players? Transfer fees are amortised (written off) over the term of the contract. Example: Club pays 9m for a player on a 3 year contract. Year 1 accounts=3m; Year 2 accounts=3m; Year 3 accounts=3m Say the player is sold after year 1 for 5 million, there is still 6m of cost still on the books. When the player is sold, even though there is 2 years left on the contract, the 'hit' of 6m happens in the current accounting year rather than being spread over 2. That 6m is deducted from the 5m realised from the sale of the player. So instead of having 5m to invest in the squad the club actually has an accounting loss of 1m as far as FFP is concerned. So the club has sold the player but in the short term is actually worse off. Exactly as you say. Rather than having £5m to spend from the sale there is actually a £1m loss. The part that hasn't been mentioned though is that the expected year 2 charge from the original fee will no longer need to be paid so the club is actually £2m better off in year 2 than it would be if the sale hadn't been made. Also the £3m charge in year 3 will no longer be made. It's all about the timing and the sale price compared to the buying price. Making a loss on a player is one thing but it is only one side of the issue. If we buy a player for £3m and sell him for £9m we make a profit (OK we don't do it very often) that profit could change the FFP situation. We do have some players who are worth money, FF, Lees, Hooper etc. If we are changing formation and strategy it may be that some become surplus to requirements. We can argue about which ones to sell but it's been done to death, suffice to say it is one option. Maybe it is about time we parted company with some good players, they have been here a while and could be becoming stale. I'm not saying we should, just putting the thought out there. If it allows us to find good exciting young talent and bring them in it might be a way of moving forwards. 1 Link to comment Share on other sites More sharing options...
Guest Posted January 23, 2018 Share Posted January 23, 2018 49 minutes ago, edwinowl said: This is a really good listen. The Nordic guy talks a lot of sense. Seems Wolves are in the clear as they've bought young quality players who would be sold on for profit if they didn't make the PL therefore negating any ffp fine . Not heard last 20 mins but it's worth a listen and has bought the arena of financing understanding up a lot. Wolves have loaned most of there team Link to comment Share on other sites More sharing options...
jamthesun Posted January 23, 2018 Share Posted January 23, 2018 2 hours ago, HarrowbyOwl said: Is this other people's understanding of the point about the club being worse off if we sell players? Transfer fees are amortised (written off) over the term of the contract. Example: Club pays 9m for a player on a 3 year contract. Year 1 accounts=3m; Year 2 accounts=3m; Year 3 accounts=3m Say the player is sold after year 1 for 5 million, there is still 6m of cost still on the books. When the player is sold, even though there is 2 years left on the contract, the 'hit' of 6m happens in the current accounting year rather than being spread over 2. That 6m is deducted from the 5m realised from the sale of the player. So instead of having 5m to invest in the squad the club actually has an accounting loss of 1m as far as FFP is concerned. So the club has sold the player but in the short term is actually worse off. S'right but FFP applies to the club's loss so other factors like wages come into play too. If we don't have to pay his wages then that redues the costs so reduces losses overall potentially..... Link to comment Share on other sites More sharing options...
Whatahoot Posted January 23, 2018 Share Posted January 23, 2018 2 hours ago, HarrowbyOwl said: Is this other people's understanding of the point about the club being worse off if we sell players? Transfer fees are amortised (written off) over the term of the contract. Example: Club pays 9m for a player on a 3 year contract. Year 1 accounts=3m; Year 2 accounts=3m; Year 3 accounts=3m Say the player is sold after year 1 for 5 million, there is still 6m of cost still on the books. When the player is sold, even though there is 2 years left on the contract, the 'hit' of 6m happens in the current accounting year rather than being spread over 2. That 6m is deducted from the 5m realised from the sale of the player. So instead of having 5m to invest in the squad the club actually has an accounting loss of 1m as far as FFP is concerned. So the club has sold the player but in the short term is actually worse off. I agree with this on the face of it, but what happens IF (just saying IF) we have used Doyen money to part finance a player purchase. That is part of their activities,as I understand it, to provide part finance for players attached to them and take a percentage if a player is sold on at a profit. That would change the dynamics of any deal and how it would be dealt with regarding FFP and our Audited Accounts, would it not ? Just putting it out there for consideration, It will be interesting to read our next set of audited accounts. Link to comment Share on other sites More sharing options...
prowl Posted January 23, 2018 Share Posted January 23, 2018 In the podcast they make a big point about people buying clubs because of the massive profits that can be made from being in the Premier league. It can increase the value of the club but it doesn't lead to profits in the annual accounts, most clubs lose money.... Totals for all clubs 2015-16 Turnover £3.649bn (up from £3.4bn in 2014-15) Wages £2.247bn – 61% of turnover (Up from £2bn, 60% of turnover, in 2015) Profit/loss Twelve clubs made profit: £153m Eight clubs made loss: £270m Overall loss: £117m (was a £113m profit overall in 2015) the clubs who actually made a profit averaged about £14/£15m not exactly a massive fortune when DC is subsidising us to the tune of £13m each year. Link to comment Share on other sites More sharing options...
Guest mkowl Posted January 23, 2018 Share Posted January 23, 2018 Next time read my posts you lot. Been telling you this about FFP and how transfer fees are written over a number of years. Link to comment Share on other sites More sharing options...
HarrowbyOwl Posted January 23, 2018 Share Posted January 23, 2018 21 minutes ago, prowl said: The part that hasn't been mentioned though is that the expected year 2 charge from the original fee will no longer need to be paid so the club is actually £2m better off in year 2 than it would be if the sale hadn't been made. Also the £3m charge in year 3 will no longer be made. That's what I was trying to get my head around. It's not really that we are worse off, is it? If we sell the player for 5m, the 6m outstanding is deducted, meaning a loss of 1m (income 5m- charge 6m = accounting loss of 1m) If we keep the player there's be a 'loss' of 3m - the second year amortisation (income =zero - charge 3m = accounting loss of 3M) So we are actually still 2m better off having sold the player than not. Albeit we are only 2m to the good, not the full 5m. Next time I'm going to need something stronger than tea! Link to comment Share on other sites More sharing options...
HarrowbyOwl Posted January 23, 2018 Share Posted January 23, 2018 10 minutes ago, mkowl said: Next time read my posts you lot. Been telling you this about FFP and how transfer fees are written over a number of years. Yeah but that's the easy bit. Help us with hard stuff Link to comment Share on other sites More sharing options...
owls101 Posted January 23, 2018 Share Posted January 23, 2018 So to sum up for those that cant be bothered to listen, we need to get shut of Rhodes asap cos hes poo Link to comment Share on other sites More sharing options...
Ever the pessimist Posted January 23, 2018 Share Posted January 23, 2018 20 minutes ago, mkowl said: Next time read my posts you lot. Been telling you this about FFP and how transfer fees are written over a number of years. Did someone say something? 1 Link to comment Share on other sites More sharing options...
edwinowl Posted January 23, 2018 Share Posted January 23, 2018 48 minutes ago, dan1980 said: Wolves have loaned most of there team Spent 50 million in transfer fees last 2 season that doesn't include undisclosed fees. Paying massive wages. Link to comment Share on other sites More sharing options...
ChinaOwl Posted January 23, 2018 Share Posted January 23, 2018 52 minutes ago, dan1980 said: Wolves have loaned most of there team How is it possible to loan most of the team? I am pretty sure there are limitations to the number of loanees that can appear in the matchday squad and less that are permitted on the field at any one time. If most of the players were on loan, they wouldn't even be able to put out a team. Link to comment Share on other sites More sharing options...
Rhubarb n Custard Posted January 23, 2018 Share Posted January 23, 2018 7 hours ago, Ever the pessimist said: I suspect it will be worrying - so i maturely deciding to take the ostrich approach and pay it no heed. Ditto. Link to comment Share on other sites More sharing options...
Guest Posted January 23, 2018 Share Posted January 23, 2018 29 minutes ago, ChinaOwl said: How is it possible to loan most of the team? I am pretty sure there are limitations to the number of loanees that can appear in the matchday squad and less that are permitted on the field at any one time. If most of the players were on loan, they wouldn't even be able to put out a team. Ok half team prob a bit over the top but they got 5 or 6 on loan who in there squad every week and there players who shoukdnt be in our league Link to comment Share on other sites More sharing options...
the mighty wednesday Posted January 23, 2018 Share Posted January 23, 2018 Wolves last 4 record signings 2010 some bloke called Fletcher 6.5m 2016 Cavaleiro 7m Jan 2017 Costa 13m Jul 2017 Neves 15.8m The last 3 come to 35.8m. Apparently they have loaned Boly (Porto), Vinagre (Monaco), N'Diaye (Villareal), Jota (A.Madrid) and Bonatini (Al Hilal). A lot will depend on how much they are paying the loanees and if a loan fee has been paid. Link to comment Share on other sites More sharing options...
shezzas left peg Posted January 23, 2018 Share Posted January 23, 2018 Hmm maybe one of the reasons Jos is bringing the under 23s in as the FFP is going to shaft us with a transfer embargo,so if we can get the youngsters to step up we can shuffle the big earners out and maybe cash in on saleable assets like lees, Bannan and Nando to balance the books while adding some cheap imports like joey. If so let's hope Jos is a good wheeler dealer in the transfer market. Link to comment Share on other sites More sharing options...
jamiejohn Posted January 23, 2018 Share Posted January 23, 2018 We all knew it was coming but surely if we release the out of contract players pudil, loovens,Wallace and nuhui we would save a few million in wages and still have a big squad we have three keepers so we could sell Westwood bring in 3/4 million and lose a big wage we would have palmer and hunt at right back fox and Penney left lees fred if we sign him and van aken centre back with the three young lads hopefully stepping up if jos wants to change things he will have to wheel and deal the midfield is still overmanned jones,lee,Boyd,abdi,bannan,reachand hutch and joey we could maybe lose a couple and allow jos to bring in his own men hopefully reducing wages and turning a profit upfront we would have hooper,Rhodes, fletcher,jaoa ,winnall,matttais and fessi we don't need that many particularly if we go one up front I can see winnall going for decent money and we could sell at least one more this would save us a lot of money without selling our best players or we could sell one or two of those and hope jos can bring on as good or better with the proceeds it doesn't have to be the disaster some believe and we can still be contenders next season Link to comment Share on other sites More sharing options...
the mighty wednesday Posted January 23, 2018 Share Posted January 23, 2018 I think Jos is playing the U23's simply because he needed them to make up the numbers in training and they did ok. Consequently as we are short of bodies, especially at CB, he has decided to give them some game time. I don't see it as anything to do with cutting costs. Link to comment Share on other sites More sharing options...
Owlthekop Posted January 23, 2018 Share Posted January 23, 2018 (edited) FFP is grossly unfair for clubs not in receipt of parachute payments. As seen by the likes of Villa and even Sunderland, that £40 million per year for three years (I know it reduces from £40 in year 2 and 3) is re invested in big players on big wages and not used to prop them up on their existing players wages from the premier league as it was intended. This gives those 6-9 clubs a huge financial head start over teams like Wednesday who've been in the Championship for a number of years. Clubs in receipt of parachute payments should ONLY be allowed to spend that money on existing wages and new transfers should have to be from matchday/merchandise/sponsorship money they generate. I get his comments about transfer fees spread over the length of their contract, but surely with players like Wallaceon a free, their £30 grand a week plus wages if they were released would save us millions in wages? If we don't get penalised by FFP for infrastructure, such as training facilities (which Wednesdays are well known to be poor for this level) why have we not seen a huge input in cash to develop this area and attract better young players...a bit like Derbys excellent facilities? I personally love DC and think without him we'd be screwed, but if PSG can pay nearly £400 million for 2 players and not fall foul of FPP, surely there must be some way around our current financial situation? Edited January 23, 2018 by Owlthekop Link to comment Share on other sites More sharing options...
1963owl Posted January 23, 2018 Share Posted January 23, 2018 id handle this ffp thing better if 7/8 clubs werent given a £30m parachute payments advantage Link to comment Share on other sites More sharing options...
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