Financial Fair Play/Financial Report (merged)

[cibaman]

Re: Financial figures appear to be somewhat late.

I think they're probably press managing this.

When they release the accounts, we're going to get a lot of wrong press stating that we have failed FFP. I can't see any way that we can turn a +£50m profit from a -£97m loss last year which we would need to do to comply.

The first Monitoring Period of FFP is only 2 years long rather than the 3 years of the ones after. The acceptable deviation over those 2 years is around -£38m. Last year we lost -£97m.

There are two things working in our favour somewhat. Firstly, this Monitoring Period allows us to discount any wages of contracts signed before June 2010 which was a hefty chunk of our wage budget from last year. Secondly, UEFA state that those clubs who are moving towards profitability, even if they fail the initial test, will be looked favourably upon.

The key here is the wage exemption. If we only lose £20m-£50m this year then the total loss for the Monitoring Period will be around -£120m-£150m but some of that expenditure isn't included in FFP and can be cut out.

The question is whether we can cut enough out of it to get to -£38m. I personally don't think we'll be able so we have to hope for UEFA to be true to their word about movement towards profitability.

City have said that the wage exemption is worth £80m. And that the exemption for youth development and infrastructure costs was worth £15m in 11/12.

 

[Falastur]

Re: Financial figures appear to be somewhat late.

I think they're probably press managing this.

When they release the accounts, we're going to get a lot of wrong press stating that we have failed FFP. I can't see any way that we can turn a +£50m profit from a -£97m loss last year which we would need to do to comply.

The first Monitoring Period of FFP is only 2 years long rather than the 3 years of the ones after. The acceptable deviation over those 2 years is around -£38m. Last year we lost -£97m.

There are two things working in our favour somewhat. Firstly, this Monitoring Period allows us to discount any wages of contracts signed before June 2010 which was a hefty chunk of our wage budget from last year. Secondly, UEFA state that those clubs who are moving towards profitability, even if they fail the initial test, will be looked favourably upon.

The key here is the wage exemption. If we only lose £20m-£50m this year then the total loss for the Monitoring Period will be around -£120m-£150m but some of that expenditure isn't included in FFP and can be cut out.

The question is whether we can cut enough out of it to get to -£38m. I personally don't think we'll be able so we have to hope for UEFA to be true to their word about movement towards profitability.

Damo, you're forgetting that the FFPR rules say that if your accounts show a noticable trend towards profitability, then you don't have to abide by the "maximum loss over a 3-year period" thing. It's only if our revenue/profits stagnated and we stopped heading towards breaking even that we will be considered under these rules.

If we make a £50-60m loss this season, I reckon we'll be fine. That said, I personally think (hope?) that we will in fact show a better return than that - I'm kind of hoping for only around a £30m loss, from what I've read about our finances and so on. I don't think that that figure is too much to ask.

 

[Stretford Born Blue]

Re: Financial figures appear to be somewhat late.

We've earned so much it's taking longer to add up...!?

 

[Skashion]

Re: Financial figures appear to be somewhat late.

Damocles, we can also exclude investment in infrastructure so your figures could be as much as £40m out.

 

[Centurions]

Re: Financial figures appear to be somewhat late.

I think they're probably press managing this.

The first Monitoring Period of FFP is only 2 years long rather than the 3 years of the ones after. The acceptable deviation over those 2 years is around -£38m. Last year we lost -£97m.

I thought it was going to be a 5 year monitoring period once it's fully implemented?

 

[Skashion]

Re: Financial figures appear to be somewhat late.

Damo, you're forgetting that the FFPR rules say that if your accounts show a noticable trend towards profitability, then you don't have to abide by the "maximum loss over a 3-year period" thing. It's only if our revenue/profits stagnated and we stopped heading towards breaking even that we will be considered under these rules.

If we make a £50-60m loss this season, I reckon we'll be fine. That said, I personally think (hope?) that we will in fact show a better return than that - I'm kind of hoping for only around a £30m loss, from what I've read about our finances and so on. I don't think that that figure is too much to ask.

Firstly, he didn't forget it, secondly, you're wrong. Trend towards compliance is at their discretion and will be looked on positively. It doesn't mean they can't punish us if we fail.

 

[Exeter Blue I am here]

Re: Financial figures appear to be somewhat late.

I think they're probably press managing this.

When they release the accounts, we're going to get a lot of wrong press stating that we have failed FFP. I can't see any way that we can turn a +£50m profit from a -£97m loss last year which we would need to do to comply.

The first Monitoring Period of FFP is only 2 years long rather than the 3 years of the ones after. The acceptable deviation over those 2 years is around -£38m. Last year we lost -£97m.

There are two things working in our favour somewhat. Firstly, this Monitoring Period allows us to discount any wages of contracts signed before June 2010 which was a hefty chunk of our wage budget from last year. Secondly, UEFA state that those clubs who are moving towards profitability, even if they fail the initial test, will be looked favourably upon.

The key here is the wage exemption. If we only lose £20m-£50m this year then the total loss for the Monitoring Period will be around -£120m-£150m but some of that expenditure isn't included in FFP and can be cut out.

The question is whether we can cut enough out of it to get to -£38m. I personally don't think we'll be able so we have to hope for UEFA to be true to their word about movement towards profitability.

Damo, you're forgetting that the FFPR rules say that if your accounts show a noticable trend towards profitability, then you don't have to abide by the "maximum loss over a 3-year period" thing. It's only if our revenue/profits stagnated and we stopped heading towards breaking even that we will be considered under these rules.

If we make a £50-60m loss this season, I reckon we'll be fine. That said, I personally think (hope?) that we will in fact show a better return than that - I'm kind of hoping for only around a £30m loss, from what I've read about our finances and so on. I don't think that that figure is too much to ask.

Will UEFA (with ragboy Gill at the helm) adhere to their own guidelines on the trend toward profitability though, if Trafford Town finish 5th in the Premier League? The cynic in me suspects they may not wish to make a decision on any City shortfall, until they get a clearer indication of where the rags are gonna end the season. And the same cynic in me suspects they would then look for reasons to throw us out of the Chimps League in order to accommodate their favourite revenue generators if they do finish 5th. Not saying it would work of course, as I'd expect City to then let loose m'learned friends and bury the whole stinking notion of FFP in Court. It is something to ponder though.......maybe

 

[dasblues]

Re: Financial figures appear to be somewhat late.

All the information points to passing the first monitoring period and therefore complinance with FFP.

The problem is we only pass due to a couple of clauses ie disallowable expenses (Academy / community spend) and wages on contracts signed before June 2010.

The headline figure will probably be around £150m loss over the two years, which is what the press will jump on.

Like others have said, this needs to be managed very carefully in terms of the negative press coverage that it will generate.

Chelsea buried their results in releasing on New years eve, perhaps we are waiting for a big enough news story to limit the damage?

 

[Newman Noggs]

Re: Financial figures appear to be somewhat late.

Much as I share Exeter Blue's cynicism I do think Chelsea's recent financial results and United's current predicament may well act in our favour and make uefa hesitant to set a very severe precedent. I expect the delay is so that the interpretation of our results and their impact on ffpr is consistent between the club and uefa when they are made public.

 

[Anonymous]

Re: Financial figures appear to be somewhat late.

Much as I share Exeter Blue's cynicism I do think Chelsea's recent financial results and United's current predicament may well act in our favour and make uefa hesitant to set a very severe precedent. I expect the delay is so that the interpretation of our results and their impact on ffpr is consistent between the club and uefa when they are made public.

UEFA aren't going to do shit to us or Chelsea. Not before they explain how Monaco and PSG are going to pass their facile rules.