15/16 financial results - £20.5m profit announced

OB1 said:
OK. In the example PB & I were discussing, I gave an opinion based on no clauses that could terminate the obligation to sell and to buy. We do not know what happens in reality and I suspect something is written in that would allow City not to sell, which could be for City's benefit but is probably there to enable the buying club to delay recognition of an actual purchase. In which case, I think City would treat the player's registration as an asset for disposal and still remove it from intangibles. However, without knowing the contract details, and they may well vary in each case, I opined on the simplest case, which is a credit sale or as you put it: "a permanent transfer with a delayed cash payment".

Of course, if the loan period was for more than 12 months, the new leasing standard might apply ;-)
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Could do haven't looked at it, don't do much work with leases since I moved to industry.

The only motivation for Roma et al structuring the transfer in the manner they did was to move their purchase and assumption of costs into a future accounting period to trim their losses for FFP so I doubt it was a credit sale structure although in that scenario you'd be correct. Seeing as we're making a profit in the last two accounting periods without the income from these deals it would make more sense to delay recognising the income for as long as possible, firstly to preserve the accumulated tax losses and secondly to offset against future expenditure and costs when it might make the difference between a small loss and a small profit. It's also best practise imo if there's not yet an equivalent purchase on the buyers books to match the sale on ours.
 
RACHACE said:
That video explaining wages etc was quality.
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Up to a point.
Nowhere does it mention 'sugar daddies', 'oil money', financial doping' ,'dodgy related party deals', 'cheating' , ' bending the rules' , or 'human rights in Abu Dhabi '- so I'm a bit suspicious of the whole thing.
If only we had a sports accountancy expert from the north London area to spell it all out for us.
 
It's funny isn't it.

When UEFA and their club cartel shaffted us, it was all over Red Cafe. They loved it! CITY WERE FINISHED!!
Since our latest financial figures were released, little or no comment on Red Cafe. Strange that.
Maybe somebody should post the video on Red Cafe to give them an update. ;-)
 
aguero93:20 said:
Could do haven't looked at it, don't do much work with leases since I moved to industry.

The only motivation for Roma et al structuring the transfer in the manner they did was to move their purchase and assumption of costs into a future accounting period to trim their losses for FFP so I doubt it was a credit sale structure although in that scenario you'd be correct. Seeing as we're making a profit in the last two accounting periods without the income from these deals it would make more sense to delay recognising the income for as long as possible, firstly to preserve the accumulated tax losses and secondly to offset against future expenditure and costs when it might make the difference between a small loss and a small profit. It's also best practise imo if there's not yet an equivalent purchase on the buyers books to match the sale on ours.
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Seems like there are two types of deal. One where there are no contingent clauses (i.e. we are paid £x on a future date) and ones where there are (e.g. a set number of appearances).

I'd guess that we could book the former as a sale & debtor as long as the contract was watertight and it was just a case of a deferred payment. The Iatter contract wouldn't be booked until the contingency clause(s) had been met I'd imagine.
 
Prestwich_Blue said:
Seems like there are two types of deal. One where there are no contingent clauses (i.e. we are paid £x on a future date) and ones where there are (e.g. a set number of appearances).

I'd guess that we could book the former as a sale & debtor as long as the contract was watertight and it was just a case of a deferred payment. The Iatter contract wouldn't be booked until the contingency clause(s) had been met I'd imagine.
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Yeah that's about right. There'd have to be some kind of clause in the loan + obligation deals though, else we'd be understating our profits and the purchaser overstating theirs.
 
I'm not convinced that United/Chelsea's kit deals are as good as they're making out. In terms of United, that £75m figure was reliant on CL football and winning trophies, the real figure they're getting paid will be considerably lower than that - despite that, they will still continue to sell more shirts than any other premiership club, so fair play to them on that market. Chelsea's new deal lasts 10 years. Surely £50m will be out of date come 2026 (with the way things are going). I'd imagine City are happy to see out the contract with Nike and will put the contract to tender when they feel the market is at it's most profitable.
 
Manchester33 said:
I'm not convinced that United/Chelsea's kit deals are as good as they're making out. In terms of United, that £75m figure was reliant on CL football and winning trophies, the real figure they're getting paid will be considerably lower than that - despite that, they will still continue to sell more shirts than any other premiership club, so fair play to them on that market. Chelsea's new deal lasts 10 years. Surely £50m will be out of date come 2026 (with the way things are going). I'd imagine City are happy to see out the contract with Nike and will put the contract to tender when they feel the market is at it's most profitable.
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Depends. Eventually the football market will hit a ceiling imo and it could be fairly soon.
 
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