City & FFP | 2020/21 Accounts released | Revenues of £569.8m, £2.4m profit (p 2395)

[baldybouncer]

Re: City & FFP (continued)

<a class="postlink" href="http://www.independent.co.uk/sport/football/premier-league/how-are-bigspending-manchester-city-set-to-pass-uefas-financial-fair-play-rules-9097609.html" onclick="window.open(this.href);return false;">http://www.independent.co.uk/sport/foot ... 97609.html</a>

That article shows you how much of our revenue is actually fudged.

Im never quite sure how to take these stories. If they are twisted to make us look bad and this is normal accounting practice for ffootball clubs, or are we actually just creating stuff to up our income. It certainly makes our accounts look extremely dodgy.

Shock horror ... a business has done something "commercially imaginative"!!

 

[Didsbury Dave]

Re: City & FFP (continued)

That article shows you how much of our revenue is actually fudged.

Im never quite sure how to take these stories. If they are twisted to make us look bad and this is normal accounting practice for ffootball clubs, or are we actually just creating stuff to up our income. It certainly makes our accounts look extremely dodgy.

I don't think it's normal practice for football clubs, but it's certainly common for multinational corporations looking to avoid tax. Starbucks UK has never made a profit in 15 years in the UK, for example, instead paying "image rights" to a company based in a far lower tax country to keep their official profits down. Dodgy as fuck, but crucially, still legal. Personally, I have no problem with City using dodgy accounting to get round what are essentially corrupt as fuck regulations.

Correct mate. Most good private businesses do it the other way. They use creative methods to bring down their stated profits as much as possible, for the simple reason that it reduces corporation tax. I will give you a very simple example: let's say you run a window cleaning business and have made a £2k profit. That means you owe the taxman £400 at the end of the year in corporation tax. But if you need some new ladders, if you buy them in the last month of that financial year and they cost £2k, then that brings your profit down to break even and you owe the taxman nothing.

This is overly simplistic but that's what everyone does. City are doing the opposite.

 

[Bodicoteblue]

Re: City & FFP (continued)

Let's not forget that we only have to jump through these financial hoops because Uefa put them there in the first place.

 

[jimbopm]

Re: City & FFP (continued)

It seems inconceivable that City will not have thought through and analysed the kind of scrutiny that the Club Financial Control Body will submit their accounts to. The expertise City have amassed includes Financial Fair Play specialists – Alex Byars and Martyn Hawkins joined from the Deloitte sports business, which helped Uefa set up the FFP legislation. But a pass or a fail by Uefa will provoke the same controversy which has accompanied City throughout their rapid journey to the top

<a class="postlink" href="http://www.independent.co.uk/sport/football/premier-league/how-are-bigspending-manchester-city-set-to-pass-uefas-financial-fair-play-rules-9097609.html" onclick="window.open(this.href);return false;">http://www.independent.co.uk/sport/foot ... 97609.html</a>

That article shows you how much of our revenue is actually fudged.

I think we have to hold our hands up as supporters and recognise that City have been indulging in 'creative' accounting practices. However I would offset that by saying that I believe we are not the only club doing this kind of thing, and that ultimately there would be no need for these questionable revenue streams if it wasn't for FFP.

UEFA's accountants have obviously decided that they want to single us out for punishment, I believe our only course of action will be challenging FFP legally on the grounds that it is anti-competitive.

 

[Henkeman]

Re: City & FFP (continued)

Im never quite sure how to take these stories. If they are twisted to make us look bad and this is normal accounting practice for ffootball clubs, or are we actually just creating stuff to up our income. It certainly makes our accounts look extremely dodgy.

I don't think it's normal practice for football clubs, but it's certainly common for multinational corporations looking to avoid tax. Starbucks UK has never made a profit in 15 years in the UK, for example, instead paying "image rights" to a company based in a far lower tax country to keep their official profits down. Dodgy as fuck, but crucially, still legal. Personally, I have no problem with City using dodgy accounting to get round what are essentially corrupt as fuck regulations.

Correct mate. Most good private businesses do it the other way. They use creative methods to bring down their stated profits as much as possible, for the simple reason that it reduces corporation tax. I will give you a very simple example: let's say you run a window cleaning business and have made a £2k profit. That means you owe the taxman £400 at the end of the year in corporation tax. But if you need some new ladders, if you buy them in the last month of that financial year and they cost £2k, then that brings your profit down to break even and you owe the taxman nothing.

This is overly simplistic but that's what everyone does. City are doing the opposite.

It's meeting fire with fire though. FFP in itself skews normal accountancy and business practices by effectively banning shareholder investment. If you have a warped set of regulations, it'll be met by directing the accounts to comply with those. That's what accountants do.

 

[silverback]

Re: City & FFP (continued)

A puzzling thought about the Scum, how can they claim a sponsorship deal for the training ground when it is only ever referred to as Carrington?

 

[aguero93:20]

Re: City & FFP (continued)

Not quite DD, you'd have to buy £16k worth of ladders :D

 

[Damocles]

Re: City & FFP (continued)

It seems inconceivable that City will not have thought through and analysed the kind of scrutiny that the Club Financial Control Body will submit their accounts to. The expertise City have amassed includes Financial Fair Play specialists – Alex Byars and Martyn Hawkins joined from the Deloitte sports business, which helped Uefa set up the FFP legislation. But a pass or a fail by Uefa will provoke the same controversy which has accompanied City throughout their rapid journey to the top

<a class="postlink" href="http://www.independent.co.uk/sport/football/premier-league/how-are-bigspending-manchester-city-set-to-pass-uefas-financial-fair-play-rules-9097609.html" onclick="window.open(this.href);return false;">http://www.independent.co.uk/sport/foot ... 97609.html</a>

That article shows you how much of our revenue is actually fudged.

That article is total guesswork and most of it is factually incorrect

 

[aguero93:20]

Re: City & FFP (continued)

A puzzling thought about the Scum, how can they claim a sponsorship deal for the training ground when it is only ever referred to as Carrington?

Apparently UEFA have been looking into it, not really expecting them to do anything though.

 

[bluemoondays]

Re: City & FFP (continued)

Not quite DD, you'd have to buy £16k worth of ladders :D

Ahh, you guys may be onto something.

Let's buy £30m worth of solid gold ladders for the players to use for step-up training, write it off against FFP.

Think it might work? ;-)