PL charge City for alleged breaches of financial rules

[halfcenturyup]

Surely inflating/concealing the true nature of revenue/costs has to be dishonest accounting?

For example, let's say the Sheikh got bored and sold up - the accounts upon which any potential buyer would base a valuation of the club would include fictitious revenue/concealed costs that would disappear the moment they took control.

I have very little idea of accounting but I'd be surprised if you could carry out that kind of activity and stay within the law.

They are only fictitious revenue and concealed costs to the PL, not to whoever is preparing the accounts.

There was a valid, fair value contract for the Etihad sponsorship that was fulfilled and fully paid for. There is no way to account for that other than the way it was done. Ask Leicester how their annual accounts account for their owner sponsorship. The PL would have liked to know if Mansour gave any money to Etihad, but for the accounts it is irrelevant.

I don't know much about the image right issue, but as I understand it, there was a valid contract to sell future image right income, net if the amounts paid to players for cash up front. I would be amazed if it wasn't at fair value as our management aren't idiots and would get tax clearance. In that case, there is no other way to account for that transaction than income year one, lower income and costs in future years.

These were valid business transactions and so wouldn't affect the view given by the accounts to a potential investor. The Etihad contract, for example, would continue to termination at the contracted amounts no matter how it was funded. The image rights of certain players would still be off books, so no change.

All imho, of course.

 

[mcfcphil]

Silverlake purchased $500 million share in the City Football Group back in 2019. They would have done the due diligence on City’s accounts and would have come to the conclusion that $500 million was worth a 10 percent stake in the club.

As daft as these charges sound, did Citys owners mislead Silverlake on what the value of the club was? Or were they in on it as well? Building a £365 million pound asset on the Etihad campus in the Co-Op Live arena is not something you do if you felt you had been ripped off or miss sold something by City’s owner.

That's a good example.

Imagine if the Sheikh walked away and sold the club. If previously unknown multi-million pound cost lines emerged overnight along with the disappearance of vast sponsorship revenue then Silverlake would stand to lose out in a dramatic way.

So what the FA are effectively saying is Silverlake's shares aren't worth what they paid for them? Quite an accusation really!

(But to repeat I am no finance expert!)

 

[mcfcphil]

They are only fictitious revenue and concealed costs to the PL, not to whoever is preparing the accounts.

There was a valid, fair value contract for the Etihad sponsorship that was fulfilled and fully paid for. There is no way to account for that other than the way it was done. Ask Leicester how their annual accounts account for their owner sponsorship. The PL would have liked to know if Mansour gave any money to Etihad, but for the accounts it is irrelevant.

I don't know much about the image right issue, but as I understand it, there was a valid contract to sell future image right income, net if the amounts paid to players for cash up front. I would be amazed if it wasn't at fair value as our management aren't idiots and would get tax clearance. In that case, there is no other way to account for that transaction than income year one, lower income and costs in future years.

These were valid business transactions and so wouldn't affect the view given by the accounts to a potential investor. The Etihad contract, for example, would continue to termination at the contracted amounts no matter how it was funded. The image rights of certain players would still be off books, so no change.

All imho, of course.

Cheers.
So if that's the case - City don't appear to have much of a case to answer!
Or at the very least I have absolutely no idea how the FA would prove otherwise.

 

[halfcenturyup]

Cheers.
So if that's the case - City don't appear to have much of a case to answer!
Or at the very least I have absolutely no idea how the FA would prove otherwise.

That said, I was nervous about the UEFA case at CAS and we breezed through that and I am pretty confident about this one.

So we are probably fucked.

 

[Bluewonder]

That's a good example.

Imagine if the Sheikh walked away and sold the club. If previously unknown multi-million pound cost lines emerged overnight along with the disappearance of vast sponsorship revenue then Silverlake would stand to lose out in a dramatic way.

So what the FA are effectively saying is Silverlake's shares aren't worth what they paid for them? Quite an accusation really!

(But to repeat I am no finance expert!)

In effect, the PL is accusing Silverlake of either being complicit in industrial-scale accounting fraud, or being defrauded by MCFC.

Likewise, hundreds of auditors, dozens of people in our own accountancy team, and several banks who provide our credit lines, along with multiple minor stakeholders such as the fan base, insurers and the trustees of the Football League Pension Scheme in which we participate.

It is patently nonsensical stuff.

 

[Bez]

In this world we live in, people look each other dead in the eyes and lie all the time. Looking someone in the eyes shouldn’t be taken as proof of impartiality, especially in the murky worlds of politics and sports, which this issue unfortunately spans both

Why would I be sued by the club for defending it’s own position?

Most people don't lie. That is a fact. Research supports me on that. We all speculate about peoples motives without having any idea about the people we are talking about. The individual's in the tribunal will have to operate with integrity because of the rules that govern what they are doing. The stakes are high for all parties. I am not of the view that the tribunal will be made up of red cartel stooges.

My previous point was that if the tribunal members disregard clear irrefutable evidence presented by City's reps because they want to have a guilty verdict irrespective of the evidence, I would not want to be one of those tribunal members. They have to do their jobs properly.

 

[Bloominmarvellous]

As I say I haven’t seen anything to suggest to me, (a Chelsea supporter who has a background in some of these matters ) to suggest that city have filed with HMRC and or Companies House accounts that understate income.

The Mancini Contracts do pose a question for the football authorities but I very much doubt that HMRC would be that interested in money paid out and accounted for under other nations tax regiemes

It’s not just city that probably have an image rights issue but that will almost be a separate debating point.
For most clubs it’s one issue but for city the problem is wider because of the issue re selling image rights off.That I suspect is something additional that HMRC will be taking a view on but not sure it’s close to fraud.
The question for me in this regard is did the other entity pay the players and account for tax etc ? If not why not?

In this area cities biggest issue for me is how they sold off rights as I am far from sure that complies with the PL rules on such matters.

Hmrc are already looking into players tax avoidance schemes from my understanding. Saw a legal bulletin and allegedly over 300 players are being investigated and one premier league club for paying agent fees through satellite clubs.

 

[Damanino]

I am just wondering why the charges are up until 2018.
Did our accounting change since then? If there are any problems with our image rights payments, Etihad deal, other sponsor payments etc, did anything change after 2018? or if they have been potentially breaking PL rules all those years do they still break those same rules in last 5 years too each year?

 

[hammocity]

Does anyone know who compiled these charges against us? I do mean which individuals trumped up these accusations. I’m guessing it’s employees/Executive members of the Premier League with a read through from in house and/or an external legal team. Whoever they are they won’t be of the same calibre of our Legal Team.

 

[Jam Tomorrow]

I am just wondering why the charges are up until 2018.
Did our accounting change since then? If there are any problems with our image rights payments, Etihad deal, other sponsor payments etc, did anything change after 2018? or if they have been potentially breaking PL rules all those years do they still break those same rules in last 5 years too each year?

That’s round four of City against the Cartel. Anyone who thinks this will be the end of it is mistaken. If and it’s a big if they get anything to stick they will then unbundle another load of shit, UEFA will also be watching with interest. They want us gone and won’t stop.