PL charge City for alleged breaches of financial rules

[slbsn]

The PL would have to prove that the two parties were related on the balance of probabilities. That wouldn't be easy in the first place, but what is the effect if they can prove it?

There is no legal requirement for the accounts to show related party transactions at fmv, so it would make no difference to the main accounting statements. There is a requirement for a note disclosure, though, so readers of the accounts can make their own minds up. No-one is getting a points deduction or going to jail for a disputed note disclosure.

The PL rules, though, do allow the PL to restate related party income to fmv and so the later inclusion of a related party transaction disclosure may lead to a correction to the club's FFP results.

I still think this is maybe what the PL is looking at, although others disagree. I think Herbert's "understanding" and the shift (if it's not nonsense) from fraud to complexity supports that.

I think that is all right, but it's just my opinion and may all be bollocks, of course.

There is nothing in Herbert’s article to support this. You may be right re related party designation (as you know I think it is very unlikely to be the key charge) but you really can’t read that from Herbert’s few words

 

[halfcenturyup]

Long-term financial contracts ARE complex.

This is why accountants and auditors are well paid.

You wouldn't expect an online football salesman like Herbert to understand them.

To be fair to Herbert, the APT tribunal did refer to the 2023 Etihad renewal as "as complicated on its own as all the contracts most clubs would close on all their sponsorships in a year" (paraphrasing) and mentioned, as an example, the 90 page inventory. I suppose it is likely the same is true of previous renewals.

But again, I think it's the change in narrative he has been given from filing fraudulent accounts (which is, of course, against the rules) to complexity (which isn't, of course) is interesting.

 

[cheekybids]

just because they are published doesnt mean their isnt anything dodge ! Arent Citys account published ? City are accused of fraud

I would dispute any costs attributed to maintenance ;)

 

[halfcenturyup]

There is nothing in Herbert’s article to support this. You may be right re related party designation (as you know I think it is very unlikely to be the key charge) but you really can’t read that from Herbert’s few words

I was just answering a question about the effect if the PL succeeded in changing the nature of the Etihad transaction, for example, to an RPT.

But yes, it's all speculation. No-one knows anything. You do agree, though, that the fact he has this "understanding" suddenly and chooses to share it is interesting?

Edit: And just to be clear, I never said RPTs and FMVs are the key allegations, the key (most serious) allegations are presumably the funding of the sponsorships and its effect on the accounts. I do think it's likely they have been included in the PL's Statement of Facts, though. It's fine if you don't share that view.

 

[citizen_maine]

I was just answering a question about the effect if the PL succeeded in changing the nature of the Etihad transaction, for example, to an RPT.

But yes, it's all speculation. No-one knows anything. You do agree, though, that the fact he has this "understanding" suddenly and chooses to share it is interesting?

If he gets his understanding from MagicHat?

 

[Prestwich_Blue]

So the question why do the clubs that get screwed over do nothing ? Theres only 4 clubs that stand up to the pl. I would guess the others are breaking the rules somewhere along the way so support the cartel for their own protection.

I cant see why the IC cant say until all clubs are investigated to Citys level the case is null n void !!

You have to have good grounds to launch an investigation, is my understanding. Unless there's another Der Spiegel-type article about the financial dealings of another club, there are no grounds.

Having said that though, any club whose owners' accounts are filed in a tax haven should definitely be investigated. Any responsible regulator would want to know about any debt not declared via publicly filed accounts, in order to ensure that the club was at no risk should something happen.

 

[WRicko]

The PL would have to prove that the two parties were related on the balance of probabilities. That wouldn't be easy in the first place, but what is the effect if they can prove it?

There is no legal requirement for the accounts to show related party transactions at fmv, so it would make no difference to the main accounting statements. There is a requirement for a note disclosure, though, so readers of the accounts can make their own minds up. No-one is getting a points deduction or going to jail for a disputed note disclosure.

The PL rules, though, do allow the PL to restate related party income to fmv and so the later inclusion of a related party transaction disclosure may lead to a correction to the club's FFP results.

I still think this is maybe what the PL is looking at, although others disagree. I think Herbert's "understanding" and the shift (if it's not nonsense) from fraud to complexity supports that.

I think that is all right, but it's just my opinion and may all be bollocks, of course.

And could the accounts potentially be deemed false if and a lot of ifs here so maybe I am over doing it and being overly worried. I am not really too worried more seeing if I can be less worried if that makes sense.

Any what I was going to say if they can be disputed as related party and then potentially marked down in value potentially significantly then could the accounts be deemed false ?

Also it strikes me as problematic for the panel they are presumably set up in a way that takes evidence and forms opinions on trustworthiness of witness etc if the focus has been on are such and such telling the truth and is this or that related etc and what happened with x y or z money etc.

If they then decide that x is actually related would it not need another panel or another hearing and some outside companies to value the deals and determine fair market value ?

 

[Damocles]

Any responsible regulator

Lol

 

[halfcenturyup]

And could the accounts potentially be deemed false if and a lot of ifs here so maybe I am over doing it and being overly worried. I am not really too worried more seeing if I can be less worried if that makes sense.

Any what I was going to say if they can be disputed as related party and then potentially marked down in value potentially significantly then could the accounts be deemed false ?

Also it strikes me as problematic for the panel they are presumably set up in a way that takes evidence and forms opinions on trustworthiness of witness etc if the focus has been on are such and such telling the truth and is this or that related etc and what happened with x y or z money etc.

If they then decide that x is actually related would it not need another panel or another hearing and some outside companies to value the deals and determine fair market value ?

:) I am going to get in trouble again discussing your hypotheticals, but no. Again, there is no requirement for RPTs to be at FMV in the main accounting statements, only that they are disclosed with some detail. As I said, no-one is going to say the accounts are false because of a missing note disclosure.

For the rest I don't really care because I don't think it will happen.

 

[halfcenturyup]

If he gets his understanding from MagicHat?

It is still interesting.