A question about FFPR and our future Academy set-up.

[Nascent Blues]

Do the fees/wages paid for these kids (under a certain age?) count towards FFPR, or can they be written off as being attributed to the youth set-up system which, as far as I can gather (by reading stuff on here), isn't calculable in FFPR?

If this is the case then it may also explain why we have been hoovering up young talent on the scale we have recently. If players like Weiss and Guidetti are sold for a few million quid, then it's another decent income for the club, especially if the Academy get to the point where three, four or five young, talented and coveted players are being released, for a decent fee (with sell on) every year.

 

[Prestwich_Blue]

Do the fees/wages paid for these kids (under a certain age?) count towards FFPR, or can they be written off as being attributed to the youth set-up system which, as far as I can gather (by reading stuff on here), isn't calculable in FFPR?

If this is the case then it may also explain why we have been hoovering up young talent on the scale we have recently. If players like Weiss and Guidetti are sold for a few million quid, then it's another decent income for the club, especially if the Academy get to the point where three, four or five young, talented and coveted players are being released, for a decent fee (with sell on) every year.

Expenditure on youth development does not count towards FFPR. That includes the wages of the players and coaching staff.

 

[Nascent Blues]

So if we buy a kid for 2 million, sell him for 4 million a couple of years later, then the 2 million is written off, but the 4 million counts as income?

 

[Prestwich_Blue]

So if we buy a kid for 2 million, sell him for 4 million a couple of years later, then the 2 million is written off, but the 4 million counts as income?

No. The amortisation of the £2m would be the expense, which we could write off for FFP purposes. When we sold him any profit on sale would be allowable income.

 

[Braggster]

So if we buy a kid for 2 million, sell him for 4 million a couple of years later, then the 2 million is written off, but the 4 million counts as income?

No. The amortisation of the £2m would be the expense, which we could write off for FFP purposes. When we sold him any profit on sale would be allowable income.

Is that right? Do you know what the cut off for 'academy' expenditure as regards purchasing youngsters is (i.e. when does the amorto stop being disregarded for FFP purposes)? That is potentially an extremely manipulable element of the rules, and partly explains our desire to hoover up youngsters

 

[Prestwich_Blue]

So if we buy a kid for 2 million, sell him for 4 million a couple of years later, then the 2 million is written off, but the 4 million counts as income?

No. The amortisation of the £2m would be the expense, which we could write off for FFP purposes. When we sold him any profit on sale would be allowable income.

Is that right? Do you know what the cut off for 'academy' expenditure as regards purchasing youngsters is (i.e. when does the amorto stop being disregarded for FFP purposes)? That is potentially an extremely manipulable element of the rules, and partly explains our desire to hoover up youngsters

I think they have to be in the EDS to be classed as "youth".

 

[Falastur]

So if we buy a kid for 2 million, sell him for 4 million a couple of years later, then the 2 million is written off, but the 4 million counts as income?

No. The amortisation of the £2m would be the expense, which we could write off for FFP purposes. When we sold him any profit on sale would be allowable income.

Is that right? Do you know what the cut off for 'academy' expenditure as regards purchasing youngsters is (i.e. when does the amorto stop being disregarded for FFP purposes)? That is potentially an extremely manipulable element of the rules, and partly explains our desire to hoover up youngsters

You're thinking that we should just buy 50 youngsters every season and sell them for a £1m profit each after holding them for a few seasons? Yes, in theory it could work but in practise it won't. For a start, it wouldn't work because every other club would know we were hording youngsters and would therefore refuse to pay our prices, wait for the kids to get sick of not having a hope of making our first team, and leave on frees. Secondly, it wouldn't work because we're absolutely terrible at fetching good prices for young players. Remember how we just sold Vladi Weiss for barely £1m total? Yeah...we just aren't capable of manipulating the player markets.

 

[Braggster]

No. The amortisation of the £2m would be the expense, which we could write off for FFP purposes. When we sold him any profit on sale would be allowable income.

Is that right? Do you know what the cut off for 'academy' expenditure as regards purchasing youngsters is (i.e. when does the amorto stop being disregarded for FFP purposes)? That is potentially an extremely manipulable element of the rules, and partly explains our desire to hoover up youngsters

You're thinking that we should just buy 50 youngsters every season and sell them for a £1m profit each after holding them for a few seasons? Yes, in theory it could work but in practise it won't. For a start, it wouldn't work because every other club would know we were hording youngsters and would therefore refuse to pay our prices, wait for the kids to get sick of not having a hope of making our first team, and leave on frees. Secondly, it wouldn't work because we're absolutely terrible at fetching good prices for young players. Remember how we just sold Vladi Weiss for barely £1m total? Yeah...we just aren't capable of manipulating the player markets.

No. I'm thinking we should buy 3-4 good youngsters per season, develop them, and sell the ones that don't make it for wedge (£5-10m each if we know what we're doing).

We'll be able to write off the costs of acquisition for FFP purposes so it would be pure FFP profit. In addition (and, frankly, more importantly), if we can get real stars for our own first team, they will be "free" for FFP purposes instead of costing us big money. (Even though in real world terms it will probably have cost us quite a lot of money - the top young 16-17 year olds from Portugal, Spain, Italy, S. America etc can be expensive these days.)

Re: Weiss, yes, it was a depressing piece of "negotiation" by us.

 

[Falastur]

You're thinking that we should just buy 50 youngsters every season and sell them for a £1m profit each after holding them for a few seasons? Yes, in theory it could work but in practise it won't. For a start, it wouldn't work because every other club would know we were hording youngsters and would therefore refuse to pay our prices, wait for the kids to get sick of not having a hope of making our first team, and leave on frees. Secondly, it wouldn't work because we're absolutely terrible at fetching good prices for young players. Remember how we just sold Vladi Weiss for barely £1m total? Yeah...we just aren't capable of manipulating the player markets.

No. I'm thinking we should buy 3-4 good youngsters per season, develop them, and sell the ones that don't make it for wedge (£5-10m each if we know what we're doing).

We'll be able to write off the costs of acquisition for FFP purposes so it would be pure FFP profit. In addition (and, frankly, more importantly), if we can get real stars for our own first team, they will be "free" for FFP purposes instead of costing us big money. (Even though in real world terms it will probably have cost us quite a lot of money - the top young 16-17 year olds from Portugal, Spain, Italy, S. America etc can be expensive these days.)

Re: Weiss, yes, it was a depressing piece of "negotiation" by us.

Hmm...I suspect that for every one youngster you can generate that profit on, though, we'll have to sign 5-10 who barely make us what we bought them for, and quite possibly get sold on for a loss. At that age, you just can't gamble with any accuracy on who will make it and who won't. Not to mention that if a player is good enough to be sold on for a £5-10m profit, he's probably actually a player the manager will want to keep.

Add on top of that the fact that Weiss' undervaluation has been the rule of how we've sold on youngsters and not the exception - that is to say, we seem to fail to make a profit on every single youngster we release - and that is why I'm not sure this idea is doomed to success.

 

[Skip Donoghue]

Do the fees/wages paid for these kids (under a certain age?) count towards FFPR, or can they be written off as being attributed to the youth set-up system which, as far as I can gather (by reading stuff on here), isn't calculable in FFPR?

If this is the case then it may also explain why we have been hoovering up young talent on the scale we have recently. If players like Weiss and Guidetti are sold for a few million quid, then it's another decent income for the club, especially if the Academy get to the point where three, four or five young, talented and coveted players are being released, for a decent fee (with sell on) every year.

This is what academies have been doing for years....imagine it as a stud farm, some kids are good enough to make it to the level required and some maybe just fall short but are still capable of playing at a decent level....take Utd for example they will blood kids in the Carling cup etc knowing that the kid maybe not just up to making a career at the swamp, (wining the youth cup is also an important thing, it makes clubs take notice of the academy)....but once they make the 1st team squad that's a minimum of £500k-£1mill to a championship side or lower level prem side if they want to buy the kid, clubs know the coaching and breeding is top drawer

Just reading a couple of posts above you can't go paying for these kids.....they have to come through the ranks any that are bought will be expected to make the grade...if they don't make it you will find they will leave for free at the end of there contract....home grown kids is the way to make it work not imported kids