kaz7
Well-Known Member
Can we stop going on about bobbys contract, do people not read by now
Given that we still don't know what exactly the PL have charged us with, I can't see that happening Kaz. In fact:-Can we stop going on about bobbys contract, do people not read by now
No, I think [Simon Jordan] thinks he’s posh
Why are we hanging on what they say now? The bobby stuff has been explained by those who have the knowledge to do so a million times alreadyGiven that we still don't know what exactly the PL have charged us with, I can't see that happening Kaz. In fact:-
"An investigation into potential rule breaking at Manchester City is focused on illegal payments for underage players, inflated sponsorship deals and hidden salary payments made to a former manager, German newspaper Der Spiegel claims."
Man City: Der Spiegel alleges three-year Premier League investigation
An investigation into potential rule breaking at Manchester City is focused on three issues of alleged wrongdoing, German newspaper Der Spiegel claims.www.bbc.co.uk
I heard that Posh was an acronym for "Port out, starboard home" but in Jordans case probably refers to "Piece O' Shit "You actually think Simon Jordan is, or presents as ‘posh’?
I believe that the contract was with Mancini’s company Italy International Sr
Services Ltd. It is claimed that it was signed on the same day as he signed his City Contract.
The last part of the claim is that Italy International Services issued invoices quarterly to Man City itself and not Al Jaziera
I have commented on true, fair and accurate before on this thread but I will repeat some of that in a moment.
For context, I started out in audit in what is now part of one of the big four accounting firms but swiftly moved out of practice after qualifying; albeit initially into internal audit. Since then I have worked in senior finance roles for many years in businesses of varying size and been to subjected to many audits.
I have little doubt that you are correct about how city's auditors would have dealt with sponsorship income, they would have been all over anything that material.
My previous comments:
The distinction between fair and accurate is very important and I am not going to get into a long discussion of that as it will bore but - odd as it may seem to laymen - there is no requirement under law to file totally accurate accounts. In fact, it's almost fucking impossible with any sizeable business.
Fair does though mean that accounts should be materially correct - and materiality varies depending on circumstances.
Fair also means that transactions have been reported appropriately and that is where trouble might arise for City, as I guess the EPL are going to try and argue that transactions not in City's books, and which legally were not required to be, should have been reported - at least in some way - to the EPL.
Good luck with proving such a thing (obviously I don't actually wish the EPL anything but the worst of fortune). I very much doubt that all the various auditors involved have not done sufficient work to ensure that their clients' account were not true and fair under the relevant laws of the land.
The EPL look like they may be wishing to redefine the meaning of true and fair and other accepted accounting terms such as related party.
I asked whether it's plausible that there is a link haha? No one knows what the verdict will be so maybe some employees don't want the hassle and uncertainty as there seem to be a lot of them going right now.....You seemed to make the point the staff were leaving because of our impeding doom.
Completely agree. 'True and fair' is necessarily a subjective concept. It follows that the reporting company is given a certain amount of leeway in how they choose to present their affairs.As a former auditor, albeit many years ago and probably out of touch with modern practice, I'd like to clarify something. Our accounts do have to give a 'true and fair view' of our financial transactions and situation. But there's no definitive answer to, or statutory definition of, what 'true and fair' is.
But generally, for an auditor not to confirm that accounts were true and fair, there would have to be a material issue, not a few quid here or there. So even if the auditors knew about the alternative Mancini contract and felt that it should have been reported by City, in their accounts, I very much doubt they would qualify the accounts. I doubt they'd even know about it though, because it was a personal contract between Mancini and an unconnected third-party.
For a company like City, or an even bigger one, the auditors won't check every single transaction. They might satisfy themselves as to the adequacy of the financial systems for accurately recording income and expenditure and would examine relevant financial controls. A key one is whether an individual could both initiate, authorise and receive a large payment, without a second or multiple persons checking.
They most likely would (certainly in my day) have checked the larger items and that would include Etihad's sponsorship. So if our accounts showed £50m revenue from Etihad, they'd probably check that £50m was actually received. That might a single payment, or multiple payments. As long as they could track that £50m from the bank statements to the P&L account, I doubt they'd enquire much further.
But if they could only see £10m of that claimed £50m, they'd ask questions. The answer from the CFO might be that we're waiting for the other £40m,which was due shortly. I suspect they'd want to see that £40m come in before they expressed an opinion, or at the very least, have assurances from Etihad that this payment was due, relates to the period under review and a good idea of when it was due to be paid. They'd then have to make a decision as to whether the accounts were 'true and fair' (because £40m would be material) and even if they did sign the accounts off, they'd probably demand evidence of it arriving and maybe make some comment, or insist City made a relevant comment in those accounts.
Another scenario might be Etihad paying us £10m and the other £40m being from ADUG. They would presumably then question whether that was equity funding, and should therefore go into the balance sheet, rather than the P&L account. That would be subject to discussions with City senior management but I'd say the likelihood is that they would insist on it being reclassified, as it's material.
I think someone said earlier in this thread that it wasn't necessarily what was done, but what the intent was that would determine fraud. The valuation of stock affects profit. This has to be valued at the lower of cost or net realisable value, but cost may have a number of different components. It may be a very subjective judgement on what NRV is but it could be that a company is valuing stock, which it knows is completely worthless, at cost. That's likely to be fraudulent. There have been many cases where revenue from contracts signed or meant to be signed with customers has been knowingly overstated.
A high-profile case involves the software company Autonomy, who used to sponsor Spurs. https://www.bbc.co.uk/news/business-47691083. I think Mike Lynch is still fighting extradition but the UK courts have broadly supported HP's view that he and his CFO were guilty of fraud.
So just because a set of accounts aren't correct to the nearest pound, doesn't mean they aren't showing a true and fair view. And even if they're held not to be a true and fair view, there could be other reasons beyond a deliberate fraud why they might not be.
And?
Companies and individuals make back to back agreements with each other the whole time. If you bought a house with a mortgage, you did the same yourself. So there is nothing in the timing whatsoever.
The best the PL could do with this, in my view, is say that the contract with AJ is artificial, But companies enter into artificial contracts with each other all the time, especially for services. The fact that an arrangement is artificial does not make it a sham.
And so what if Mancini's company invoiced the wrong club? The two contracts were clearly linked. That doesn't make it a sham either. It's who the contract was between that counts.
If that's all they've got, we've already won.