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The accountants way at looking at transfers
- Thread starter WNRH
- Start date
Not an accountant but I think it works this way - If a player cost say £25m and is on a 5 year contract, the accounts will show his value decrease over the full period of that contract (amortisation) most football accounts will use the straight line method where the value drops by the same amount so after 3 years the player is worth £10m, if we sell him for £15m at that point we have made a profit in the accounts.
Divide the transfer fee paid by the number of years in the contract. Then multiply by the number of years left in the contract. If the fee received is higher than that figure you are making a profit on the balance sheet.WNRH said:What was that formula done for Robinho on here where it showed we actually made money on his sale even though he was sold for half of what we bought him for. Trying to work it out for Adebayor and Given.
WNRH said:What was that formula done for Robinho on here where it showed we actually made money on his sale even though he was sold for half of what we bought him for. Trying to work it out for Adebayor and Given.
I wouldn't bother thinking about it, as it's just sleight of hand. With players who are on huge wages, and who aren't going to play, there's a real cost saving from selling them at a lower price, but I don't think anyone at the club will be feeling smug about the 'profit' from Robinho.
Anyone who tries to use it in an argument down the pub, would be rightly mocked - that's if anyone was still awake after amortisation had been fully explained ;)