You're being overly pedantic here and you know it. If you can't assume that people would mean in this financial year then you're being obtuse on purpose and I can't be arsed replying to you.Well there cannot be an amortised cost at the time of transfer of any of our purchases.
There has been no time period to amortised them. All that will happen is they will be accounted as a footballing asset rather than a cash asset.
I don't see why the net cost is useless we are not trying to produce annual accounts but see how much we are spending.
I'm not being pedantic without purpose there is absolutely no point in looking at purchases on an amortised annual cost basis for this year without adding in every other member of the squads costs to see what the total cost for the year is. De Bruyne's £50+M over 6 years is every bit as relevant to the accounts as anyone bought this window. What is being looked at is a net spend.You're being overly pedantic here and you know it. If you can't assume that people would mean in this financial year then you're being obtuse on purpose and I can't be arsed replying to you.
But we had operating profit of £90m last year with KDB's contract taken into account. We already know that baseline. We know that (wages aside), that allows us considerable transfer spend this year as costs are amortised.I'm not being pedantic without purpose there is absolutely no point in looking at purchases on an amortised annual cost basis for this year without adding in every other member of the squads costs to see what the total cost for the year is. De Bruyne's £50+M over 6 years is every bit as relevant to the accounts as anyone bought this window. What is being looked at is a net spend.
I see your point yes but there are two other factors in that we don't know how much of the profits we will assign to transfers and how much we may need to assign to other things.If you were doing it on annual amortised basis and looking at what we have free, you also need to look at the amounts we are no longer attributing to Navas, Clichy, Caballero etc.But we had operating profit of £90m last year with KDB's contract taken into account. We already know that baseline. We know that (wages aside), that allows us considerable transfer spend this year as costs are amortised.
Net spend is irrelevant. Taken by itself, one wouldn't know if we have £50m net, £150m net or £300m net to play with. Selling a player (such as KDB) for £50m this year may look like a lot in terms of net sales but in reality it's a profit of £16.66m and not as helpful to us as selling Nacho for £25m. Do you see my point?
You've pretty well nailed it I'd say and, along with SWP's Back's post above I'd say my mission to educate and inform on matters financial, is done.Please correct me if I am wrong (I am no accountant), but they are also related aren't they. If we spend for example 300 million this summer, depending on the contract lengths, this money will hit our accounts in the next years. If for simplicity all players we bought would get 5 years contracts, we would see a 60 million impact in each of the coming 5 years as a result of the 300 million outlay this summer. The 60 million is what we will have to make sure is financed in the future bottom lines, because this money counts for FFP.
I have not touched upon the subject of wages here, obviously that is also important.
It is a balancing act, but if we can finance it with sales this year, aren't the Etihad and Nike deals up for grabs ? That should help going forward.You've pretty well nailed it I'd say and, along with SWP's Back's post above I'd say my mission to educate and inform on matters financial, is done.
We could spend £250m this summer and also generate a transfer profit of £50m from the sale of players who have little residual value (such as Hart). So that would mean, at least for that year, effectively a zero net spend (assuming all the players bought are given 5 year contracts). But next year we might sell no one and have the next £50m instslnent of amortisation hitting the P&L account. And of course we have to have the hard cash to finance those deals as the Sheikh isn't paying the lot up-front anymore.
That's why it's a real financial balancing act.
Yes. Also true, hence I was asking the OP originally to work all of that out for me so I don't have to do it.I see your point yes but there are two other factors in that we don't know how much of the profits we will assign to transfers and how much we may need to assign to other things.If you were doing it on annual amortised basis and looking at what we have free, you also need to look at the amounts we are no longer attributing to Navas, Clichy, Caballero etc.
Yep plus we are now generating a nice profit.It is a balancing act, but if we can finance it with sales this year, aren't the Etihad and Nike deals up for grabs ? That should help going forward.
OK fair enough.Yes. Also true, hence I was asking the OP originally to work all of that out for me so I don't have to do it.