| PSR Theory - ORG portfolio 10:11 - Jul 3 with 3655 views | nrb1985 |
Given that it seems we have bid 30m for the Hull pair and also spent 20m for Omari - I wonder if we may see some clever accounting between the different parts of the ORG/Pension fund portfolio.
From Swiss Ramble and others, sounded like we had about £60m to spend but seems we'll likely blow through that.
Chelsea for example sold their training ground (I assume no money ever exchanged hands) to another company in the Clearlake portfolio. I wonder if we can move assets between other companies in the ORG portfolio? More difficult as we don't own the ground but would make sense from a "clever" accounting point of view.
It's not really cricket in my view but the PL turned a blind eye to everyone else for so long, so why not. Whole thing is a sham anyway because it means the rich clubs stay rich, while we are penalised for being promoted from L1 to Prem in successive years. |  | | |  |
| PSR Theory - ORG portfolio on 10:15 - Jul 3 with 3577 views | NthQldITFC |
I don't think we need to sully ourselves like that when WGSKM. |  |
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| PSR Theory - ORG portfolio on 10:22 - Jul 3 with 3493 views | FrimleyBlue |
As far as im aware, it's not that we only have upto 60 mill to spend it's more we only have 63 loss to play with. So you'd imagine there would be some very indepth forecasting going on.
The biggest thing which doesn't seem to have been spoken about much is the latest investors are heavy players when it comes to commercial and digital advertising partnerships, so you can imagine on this side of things with the global reach of the premiership, we will make a heavy sum on this, plus the full capacity attendances, and the additional shirt sales we're about to have considering we were already selling shirts at prem level numbers anyway. |  |
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| PSR Theory - ORG portfolio on 10:53 - Jul 3 with 3331 views | WeirdFishes |
Remember amortisation though, the £20m for Omari would be across 5 years of accounts for FFP purposes so only c. £4m in (I guess) last years accounts. |  |
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| PSR Theory - ORG portfolio on 11:25 - Jul 3 with 3110 views | Guthrum |
| PSR Theory - ORG portfolio on 10:22 - Jul 3 by FrimleyBlue |
As far as im aware, it's not that we only have upto 60 mill to spend it's more we only have 63 loss to play with. So you'd imagine there would be some very indepth forecasting going on.
The biggest thing which doesn't seem to have been spoken about much is the latest investors are heavy players when it comes to commercial and digital advertising partnerships, so you can imagine on this side of things with the global reach of the premiership, we will make a heavy sum on this, plus the full capacity attendances, and the additional shirt sales we're about to have considering we were already selling shirts at prem level numbers anyway. |
Indeed. It's all about losses. Prem commercial revenue and, for last season, the number of times we were on TV, added to ticket sales and merch, will give us a fair degree of leeway before we even begin eating into that figure. |  |
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| PSR Theory - ORG portfolio on 11:41 - Jul 3 with 3053 views | _clive_baker_ |
We don't need to. We have significant FFP headroom to play with this summer. |  | | |
| PSR Theory - ORG portfolio on 12:22 - Jul 3 with 2937 views | HighgateBlue |
Any sale of an asset of substantial value would have to be at a fair market value, otherwise the Premier League can look into it and take enforcement action. There is a great belief that there are lots of loopholes, when in fact there are far fewer than one might think. I'm not saying that the Premier League has been fastidious in enforcing the rules, but the suggestion here is that we can do something clever within the rules without any fear of it being a problem. I think the Premier League may get tougher in terms of enforcing the rules against supposedly "clever" ways round them, which aren't actually that clever at all. I certainly wouldn't want to gamble the stability of the football club on the Premier League continuing to be lax.
Under PSR, a loss of £105m over 3 years is permitted. If one is accounting for assets at a fair market value, I can't see that we have sufficient assets to really shift the dial very much. How much would our freehold property be worth on the open market? Not a great deal, and once it's gone, it's gone.
Also, in any market valuation of the training ground for PSR purposes, surely the valuation would have to proceed on the basis that the football club would continue to have rights of occupation following the freehold sale. Any lease back to the club at a peppercorn rent would render the freehold substantially less valuable (and indeed virtually worthless if the lease were for a very substantial term). So I would struggle to see how much creative accounting can really achieve in respect of land rights.
Spreading costs over a multi-year period is probably the tool that makes the biggest difference to us. |  | | |
| PSR Theory - ORG portfolio on 12:32 - Jul 3 with 2835 views | burnbudgiesburn |
I wonder how much we will front load our 3 year loss limit this season.
Whereas we go very close to our limit which leaves us with no wriggle room for the next few seasons but leaves us with a better equipped squad now. | | | |
| PSR Theory - ORG portfolio on 12:40 - Jul 3 with 2801 views | PhilTWTD |
| PSR Theory - ORG portfolio on 12:22 - Jul 3 by HighgateBlue |
Any sale of an asset of substantial value would have to be at a fair market value, otherwise the Premier League can look into it and take enforcement action. There is a great belief that there are lots of loopholes, when in fact there are far fewer than one might think. I'm not saying that the Premier League has been fastidious in enforcing the rules, but the suggestion here is that we can do something clever within the rules without any fear of it being a problem. I think the Premier League may get tougher in terms of enforcing the rules against supposedly "clever" ways round them, which aren't actually that clever at all. I certainly wouldn't want to gamble the stability of the football club on the Premier League continuing to be lax.
Under PSR, a loss of £105m over 3 years is permitted. If one is accounting for assets at a fair market value, I can't see that we have sufficient assets to really shift the dial very much. How much would our freehold property be worth on the open market? Not a great deal, and once it's gone, it's gone.
Also, in any market valuation of the training ground for PSR purposes, surely the valuation would have to proceed on the basis that the football club would continue to have rights of occupation following the freehold sale. Any lease back to the club at a peppercorn rent would render the freehold substantially less valuable (and indeed virtually worthless if the lease were for a very substantial term). So I would struggle to see how much creative accounting can really achieve in respect of land rights.
Spreading costs over a multi-year period is probably the tool that makes the biggest difference to us. |
The stadium - the buildings, the bit the club owns - was valued at £10m around 20 years ago so won't have increased in value very significantly since then. The training ground was sold to Marcus Evans (Guernsey) for £1.32 million during the year 2011/12, Town subsequently paying an annual rent of £40,000. Club owns the whole training ground again now. |  | | |
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| PSR Theory - ORG portfolio on 15:03 - Jul 3 with 2484 views | nrb1985 |
| PSR Theory - ORG portfolio on 10:53 - Jul 3 by WeirdFishes |
Remember amortisation though, the £20m for Omari would be across 5 years of accounts for FFP purposes so only c. £4m in (I guess) last years accounts. |
Yes you're right, hadn't factored that in - so in fact it's over the life of the contract.
Weirdly, I think sales are booked immediately at full value if I recall.
The point re moving assets around the various portfolio companies remains though given that seems to be what other clubs with similar ownership models have done, to allow them more room to manoeuvre.
We should take advantage of whatever opportunities arise from being owned by an institutional investment fund. | | | |
| PSR Theory - ORG portfolio on 16:01 - Jul 3 with 2374 views | SmithersJones |
| PSR Theory - ORG portfolio on 15:03 - Jul 3 by nrb1985 |
Yes you're right, hadn't factored that in - so in fact it's over the life of the contract.
Weirdly, I think sales are booked immediately at full value if I recall.
The point re moving assets around the various portfolio companies remains though given that seems to be what other clubs with similar ownership models have done, to allow them more room to manoeuvre.
We should take advantage of whatever opportunities arise from being owned by an institutional investment fund. |
You’re right about sales getting booked immediately. So, for example, if we really did get £1m for Ahadme and, say, £3m for Edmundson, that would balance out a £20m purchase in 24/25. Obviously that’s a short term view - we’d be taking a £4m hit for the next 5 years on a £20m purchase, but it shows how PSR can encourage short term thinking. | | | |
| PSR Theory - ORG portfolio on 18:05 - Jul 3 with 2266 views | BABLUE |
| PSR Theory - ORG portfolio on 16:01 - Jul 3 by SmithersJones |
You’re right about sales getting booked immediately. So, for example, if we really did get £1m for Ahadme and, say, £3m for Edmundson, that would balance out a £20m purchase in 24/25. Obviously that’s a short term view - we’d be taking a £4m hit for the next 5 years on a £20m purchase, but it shows how PSR can encourage short term thinking. |
Only sales of youth players are banked in full when made.
Other sales are over the lifespan of the contract
Chelsea banked £20m on Sunday for Omari, but we have £5m a year for 4 years.
If they sell Lukaku for £20m later in the window it will be split over the like of the contract.
That’s why clubs were selling youth players to each other last week not established players. |  | | |
| PSR Theory - ORG portfolio on 18:36 - Jul 3 with 2211 views | ElephantintheRoom |
Don’t worry - Ashton & O’Leary will spread the cost over five years - what could possibly go wrong? | |
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| PSR Theory - ORG portfolio on 18:54 - Jul 3 with 2165 views | ArnoldMoorhen |
We can amortise the fees over the length of the contract.
So £55 million of fees for three players on 5 year contracts, amortises to £11m per year, plus £3m per year wages (£60k per week) per player, so £9m per year total, becomes £20 million a year for 5 years for the three players.
Bearing in mind that we have TV money this year, then three years tapering parachute payments, we wouldn't get into any trouble until year 5 of the deal, even if relegated after one season and we fail to gain promotion in any of the parachute seasons. If we are able to sell any of them following relegation, then we would be fine. If we are promoted in any of the parachute payment seasons, then we are fine. If we stay up this season, we are fine.
It's not until Year 5 that any 541t hits the fan, and then only if everything goes wrong. That's why youngish players with high ceilings and good characters are being targeted. | | | |
| PSR Theory - ORG portfolio on 19:03 - Jul 3 with 2103 views | WeirdFishes |
| PSR Theory - ORG portfolio on 18:05 - Jul 3 by BABLUE |
Only sales of youth players are banked in full when made.
Other sales are over the lifespan of the contract
Chelsea banked £20m on Sunday for Omari, but we have £5m a year for 4 years.
If they sell Lukaku for £20m later in the window it will be split over the like of the contract.
That’s why clubs were selling youth players to each other last week not established players. |
I don’t think that’s right. | |
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| PSR Theory - ORG portfolio on 19:06 - Jul 3 with 2087 views | MVBlue |
| PSR Theory - ORG portfolio on 12:40 - Jul 3 by PhilTWTD |
The stadium - the buildings, the bit the club owns - was valued at £10m around 20 years ago so won't have increased in value very significantly since then. The training ground was sold to Marcus Evans (Guernsey) for £1.32 million during the year 2011/12, Town subsequently paying an annual rent of £40,000. Club owns the whole training ground again now. |
Your post about Marcus Evans made me go back and research his company. It genuinely seems to simply be a sales company for forcing training and summits down the throats of contacts via cold calling. Low wages with high commissions. The Youtube employee interviews revealed a certain demographic and was all sales staff.
Crikey we were owned as a tax write off by a summit sales company . The employee reviews on Glassdoor are really something. Sheepshanks what did you do.
https://www.glassdoor.co.uk/Reviews/marcus-evans-Reviews-E17785_P4.htm?filter.is [Post edited 3 Jul 2024 19:07]
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| PSR Theory - ORG portfolio on 19:11 - Jul 3 with 2056 views | xrayspecs |
| PSR Theory - ORG portfolio on 19:03 - Jul 3 by WeirdFishes |
I don’t think that’s right. |
It isn't.
All sales are recorded at the point of sale. In the case of players who have been purchased and for whom some of the transfer fee has not been fully amortised, then you recognise the net profit (sale amount - outstanding amortisation payments).
Incidentally, signing OH on 30 June does not mean we amortise £4m in the 23/24 acounts. The date of purchase is taken into account so we would amortise 1/365 of the £4m in 23/4, £4m in the next four seasons, and 364/365 of the £4m in year five. | | | |
| PSR Theory - ORG portfolio on 19:12 - Jul 3 with 2048 views | FrimleyBlue |
| PSR Theory - ORG portfolio on 19:03 - Jul 3 by WeirdFishes |
I don’t think that’s right. |
Isn't it the case that the youths were sold as it was pretty much pure profit compared to seniors who probably had sell on fees. Maybe installments left to be paid so the value of the transfer in the lakaku sale wouldn't be 40 but most likely 20 by the time you deduct the things I've just mentioned. | |
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| PSR Theory - ORG portfolio on 19:31 - Jul 3 with 1954 views | acj |
| PSR Theory - ORG portfolio on 19:11 - Jul 3 by xrayspecs |
It isn't.
All sales are recorded at the point of sale. In the case of players who have been purchased and for whom some of the transfer fee has not been fully amortised, then you recognise the net profit (sale amount - outstanding amortisation payments).
Incidentally, signing OH on 30 June does not mean we amortise £4m in the 23/24 acounts. The date of purchase is taken into account so we would amortise 1/365 of the £4m in 23/4, £4m in the next four seasons, and 364/365 of the £4m in year five. |
Oh that’s interesting! I hadn’t realised that re: pro-rata fractional amortisation. Had wondered whether completing the Omari deal before the deadline might leave us facing an EFL fine, but evidently not in that case! |  |
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