PL charge City for alleged breaches of financial rules

[PPT]

Not in Fergie's lifetime

Hopefully.

 

[MillionMilesAway]

I don't think that City will have a strategy of purposefully drawing out the process just for the sake of drawing it out. Delay isn't good for the club now we have actually been charged, because - to state the obvious - it's bad to have the charges hanging over us, with the media and twitterverse making hay with asterisks, "115!!!!!", and all the no smoke without fire nonsense. This is not a good thing commercially, for attracting players, for attracting fans, and all that.

However, to again state the obvious, the charges are incredibly serious both for the club and the individuals concerned. They are existential for the club in its modern form, really. It does get a bit lost in the media at times that the PL have accused the club of wholesale fraud over a decade or more. So the club will be exploring every avenue and taking every possible point to defend themselves. That will obviously involve denying the charges but it will also involve criticising the process, arguing about limitation, disclosure, evidence, etc, etc. And the effect of that will be to tend to lengthen the process for resolution.


There seems to be a view in football in the media - it's either incredibly naive, or dishonest and in bad faith - that if City are innocent they should "just" open their books up and have nothing to fear. This is about as stupid as comments get really. No one accused of what City have been accused of (incredibly serious fraud and conspiracy) would do this. The charges are simply too serious. And here's the thing - if you genuinely believe you are innocent, which I'm sure City do - then the level of outrage and disgust will be high and you will feel no compunction about arguing every point and taking issue with everything the PL say, because in your mind they are making baseless allegations of dishonesty. As a claimant in a fraud case, you have to accept and expect that when you make that allegation, the gloves are off, to use an analogy. And by the way, the idiots saying this kind of thing would take a very different approach if they were themselves accused of say a serious crime. They'd want their lawyer taking any procedural point they could do in order to get off.

On top of this the complexity of the case means it will take a long time to resolve just in and of itself.

So no strategy of lengthening the process in and of itself IMO, but a strategy that will tend to have the effect of lengthening the process as a by product. Hope that helps.

It seems blindingly obvious that anything made available to the media would be cherrypicked and misrepresented for their own purposes.
Aside from confidentiality, these are about accounting, and the exact details of what each means is going to be impenetrable to most people.

The comparisons with Everton's situation make no sense to me. Theirs is about exceeding acceptable losses, and will come down to the validity of what they claim is exempt. That's much simpler to decide on as they've declared the numbers and what parts of it relate to.

 

[halfcenturyup]

Mmmmm

View attachment 86222

So it's pretty confusingly written by a non-accountant, but what I think he is saying is that Madrid sold some of their future revenues in return for cash upfront. This upfront cash was recorded as income, quite correctly, and reduced their losses. But now it's time to lose that share of the revenue. I think they are implying that Madrid should have lost 122 million if their revenue (the share due to the financing company), but instead of showing a reduction in income, they have shown a non-operating expense of 122 million. So their income remains high which is important, of course for UEFA and LaLiga FFP.

Is that about it?

If so, it's a bit naughty.

 

[richards30]

So it's pretty confusingly written by a non-accountant, but what I think he is saying is that Madrid sold some of their future revenues in return for cash upfront. This upfront cash was recorded as income, quite correctly, and reduced their losses. But now it's time to lose that share of the revenue. I think they are implying that Madrid should have lost 122 million if their revenue (the share due to the financing company), but instead of showing a reduction in income, they have shown a non-operating expense of 122 million. So their income remains high which is important, of course for UEFA and LaLiga FFP.

Is that about it?

If so, it's a bit naughty.

its beyond naughty mate and without question khaldoon or soriano will be over all this.

 

[halfcenturyup]

Hope it's a certain Mr K who has tipped off the telegraph with the story.

I can't help wondering if this is what is happening.

First, Juventus get burned for fraud, then Barcelona with their bribery and now Madrid with, err, fraudulent accounting.

If I was United or Liverpool, I would be very worried.

Consider this. Why would the Telegraph be interested in Madrid's finances?

 

[WEMBLEY76]

Wonder if reporting restrictions will be declared while the case is being heard,in relation to the filthy Uk media channels,guess City may insist on this..

 

[halfcenturyup]

its beyond naughty mate and without question khaldoon or soriano will be over all this.

Yes, sorry. That was my accountant's understatement kicking in. If my understanding is correct, that would, indeed, be fraudulent accounting. And very clearly.

 

[Prestwich_Blue]

I don't understand. If you've overstated your revenue (as we're being accused of) that's one thing. If you've hidden some costs (as we've also been accused of) that's another thing.

But if you overstated your costs, then that can't possibly be an FFP dodge. It might be a tax dodge though or a way of getting round La Liga rules in some way. It seems it's more to do with the original sale of TV rights, and whether that revenue should have been treated as a loan, rather than income, if these payments are actually repayments.

 

[halfcenturyup]

I don't understand. If you've overstated your revenue (as we're being accused of) that's one thing. If you've hidden some costs (as we've also been accused of) that's another thing.

But if you overstated your costs, then that can't possibly be an FFP dodge. It might be a tax dodge though or a way of getting round La Liga rules in some way. It seems it's more to do with the original sale of TV rights, and whether that revenue should have been treated as a loan, rather than income, if these payments are actually repayments.

Interested in your views PB. I took it to mean that revenues have been overstated by the amount of the revenue due to the financing company, so revenues overstated, with their share shown as an expense in non-operating expenses. So, revenue and operating profit both overstated.

It isn't clearly written, but that's a way it makes sense.

Edit: I think the loan aspect is a red herring. Nothing wrong with showing cash up front as revenue as long as cash due to the financing company under the arrangement is shown as a reduction in revenue. Would need to be disclosed for FFP, though, I imagine.

All Imho.

Edit to the edit: How it is treated fiscally is irrelevant, of course.

 

[foggy1974]

I don't understand. If you've overstated your revenue (as we're being accused of) that's one thing. If you've hidden some costs (as we've also been accused of) that's another thing.

But if you overstated your costs, then that can't possibly be an FFP dodge. It might be a tax dodge though or a way of getting round La Liga rules in some way. It seems it's more to do with the original sale of TV rights, and whether that revenue should have been treated as a loan, rather than income, if these payments are actually repayments.

What happens if you've hidden some of your cost which then means you've overstated your revenue under ffp regs.

Aren't these the accusations that the Premier league have thrown at City