Financial Fair Play

[markysimmo]

Do you know how much the deal is worth?

No but I've no doubting it far and above what it should be, its Chelsea after all

 

[Modric THFC]

The dodgy thing is Gazprom became an official UEFA sponsor of the Champion's League around the same time they started sponsoring Chelsea.

 

[milo]

Gazprom sponsor Schalke too and own Zenit St Petersburg.

I am sure that the value of the deal will have been looked at, over valued sponsorship deals is one of the things that PSG and Emirates Marketing Project have been pulled up for.

 

[Superhudd]

The dodgy thing is Gazprom became an official UEFA sponsor of the Champion's League around the same time they started sponsoring Chelsea.

And at the same time Chelsea won the Champions League, and when Russia won hosting of the world cup!.


It will be amazing if the £49m fine does need to be paid by City and not the Sheiks. Basically its a cull of 100m.. the fine and the shortfall from the right money value from the sponsorship that they now need to generate from legit areas.

So for a major sugar daddy.. am I right in thinking they can buy Utd.. spend 500m on players with massive sign on fees to reduce wages to 80k a man, then enter the champions league the year after.. with no fines coming.

 

[Gazza Dazzla]

My understand is that the dodgy sponsorship is what PSG and City have fallen foul with and that UEFA valued them at half what they were officially worth.

The fine will have to be included in next year's accounts, so presumably it will count next year.

UEFA have always said that banning clubs from European competition was the final sanction. I think that this a pretty tough marker and could cause Liverpool to think twice because they would have been in breach this season, if they had qualified for Europe.

Surely not, I thought Liverpool done it the right way without spending millions they didn't earn?! Or is that just the narrative we'd been fed the last 4 months?

 

[clevelandspur]

Sorry I don't see how fining Emirates Marketing Project and PSG is really a deterrent? After all they are spending this funny money to begin with, surely the Sheikh will just laugh off another 50m. Wake me up when they ban teams from competitions or give them a points deduction that's the only way anyone will take this seriosuly

 

[SWP29]

Sorry I don't see how fining Emirates Marketing Project and PSG is really a deterrent? After all they are spending this funny money to begin with, surely the Sheikh will just laugh off another 50m. Wake me up when they ban teams from competitions or give them a points deduction that's the only way anyone will take this seriosuly

Let's not kid ourselves here, £50m isn't pocket lint for the Sheikh, Abramovich or even Jordan Belfort!

 

[Danishfurniturelover]

Let's not kid ourselves here, £50m isn't pocket lint for the Sheikh, Abramovich or even Jordan Belfort!

Yes it is but then your trying to put your usual perverted spin on the cheating your club get up to due to your lack of personal ethics. Emirates Marketing Project brought there way to the title and into the top 4 by spending at massively high levels. Since the rule changes came in they carried on and have now been caught breaking the rules.

The money does not matter to them because in there own mission statement when taking over they wanted to make city one of the big teams in european football, to do this they need to win titles and compete in European competition, the anything thing that will stop them over spending is points deduction and bans from those competitions they aspire to be in.

If the owners of city spend a billion pounds on the club over 10 years it will be well spent because in 20 years time if they are one of the top teams in Europe they will be valued at a billion or over and as the oil runs out in their own countries they will have a commodity in another country in the sports sector which has seen massive growth over the last 15 years and will probably see the same growth over the next 15 years.

This 50m is a drop in the ocean to city and makes good financial sense for them in the long run. Your club and you are being used as a pawn in a rich man's folly.

 

[Whiffler]

Well, what about banning the admin heads and owners from attending CL matches?.

Not getting to sit alongside the great & the good at glory nights would dent their pride, especially when it keeps getting mentioned in the meeja with the obvious link to cheating.

 

[milo]

Sorry I don't see how fining Emirates Marketing Project and PSG is really a deterrent? After all they are spending this funny money to begin with, surely the Sheikh will just laugh off another 50m. Wake me up when they ban teams from competitions or give them a points deduction that's the only way anyone will take this seriosuly

They are fining the clubs not the owners. The fine will have to go through the books which will mean that they are £50m down on their rivals when it comes to business in the next year. The punishments are on a sliding scale, so failure to comply next year will be dealt with more severely, with the ultimate sanction being expulsion from European competition.

The first hurdle that we need to get through is this round of punishments without a successful legal challenge. Once that has happened it will become embedded into the European game.

I can understand cynicism where UEFA is concerned but we all seem to agree that some form of financial fair play is needed. This has got further than many of us thought it would. I think that it will be interesting to see how it plays out and I hope that it is successful.

 

[scaramanga]

So for a major sugar daddy.. am I right in thinking they can buy Utd.. spend 500m on players with massive sign on fees to reduce wages to 80k a man, then enter the champions league the year after.. with no fines coming.

I don't believe so.

I think UEFA use the generally accepted practice of writing down the value of a player over the length of their contract. I also believe that signing on fees are considered capital costs of a player.

So if you spent £50m on Gareth Barry (lol) and gave him a 4 year contract at £1m per year with a £10m signing on fee, you would have an accounting loss of £15m per year on the player and wage costs of £1m.

In year 2, if you sold James Milner for £20m (lol) then you would recognise that immediately, so for year 2 you would recognise a profit of £4m (assuming no other transactions and all other players fully written down).

If, in year 3 you offer Barry a new contract (lol) then the signing bonus would be capitalised and written off over the new contract.

So in your scenario, you'd have to wait until all the expensive players had their values written down and had signed new contracts before you could sneak in.

 

[SWP29]

Yes it is but then your trying to put your usual perverted spin on the cheating your club get up to due to your lack of personal ethics. Emirates Marketing Project brought there way to the title and into the top 4 by spending at massively high levels. Since the rule changes came in they carried on and have now been caught breaking the rules.

The money does not matter to them because in there own mission statement when taking over they wanted to make city one of the big teams in european football, to do this they need to win titles and compete in European competition, the anything thing that will stop them over spending is points deduction and bans from those competitions they aspire to be in.

If the owners of city spend a billion pounds on the club over 10 years it will be well spent because in 20 years time if they are one of the top teams in Europe they will be valued at a billion or over and as the oil runs out in their own countries they will have a commodity in another country in the sports sector which has seen massive growth over the last 15 years and will probably see the same growth over the next 15 years.

This 50m is a drop in the ocean to city and makes good financial sense for them in the long run. Your club and you are being used as a pawn in a rich man's folly.

I've asked before but don't remember the answer; did you used to be Chichester on the old board?

 

[Danishfurniturelover]

I've asked before but don't remember the answer; did you used to be Chichester on the old board?

No I was not but what is the relevance of that in regards what I wrote. I suspect instead of replying to the points made is because you know deep down how your club has behaved has been immoral which makes your continue support of them immoral in my opinion.

Were the same to happen at Tottenham and we were brought by a free spending billionaire we would have choice to make and I understand it would be a dilemma as we all want to see our team successful. But as when the mooted move to Stratford was talked about I would have been part of the group that would have formed and been a fan of FC Tottenham.

The fact that you stayed and supported City does not make you a bad person but it does show your attitude towards ethics especaily regarding money and rather debunks any opinions you have the subject as it smacks of self interest and one wonders whether your actually employed by City in some capacity such is your haste in always defending the indefensible.

 

[clevelandspur]

They are fining the clubs not the owners. The fine will have to go through the books which will mean that they are £50m down on their rivals when it comes to business in the next year. The punishments are on a sliding scale, so failure to comply next year will be dealt with more severely, with the ultimate sanction being expulsion from European competition.

The first hurdle that we need to get through is this round of punishments without a successful legal challenge. Once that has happened it will become embedded into the European game.

I can understand cynicism where UEFA is concerned but we all seem to agree that some form of financial fair play is needed. This has got further than many of us thought it would. I think that it will be interesting to see how it plays out and I hope that it is successful.

I can't begin to know the complexity of FFP, so when you say they fine the club and it counts towards business how does that work? As far as I am aware there is no cap on how much a club can spend on players, so what stops the Sheikh from just going out and spending more money on top of the fine?

 

[Rorschach]

I can't begin to know the complexity of FFP, so when you say they fine the club and it counts towards business how does that work? As far as I am aware there is no cap on how much a club can spend on players, so what stops the Sheikh from just going out and spending more money on top of the fine?

Owners cannot just inject cash into the club any more. Clubs must be self sustaining. Unless the club has legitimate income to offset against the spend it will appear as a loss in their books and will be further in breach of FFP rules. City tried unsuccessfully to boost their numbers with sponsorship which was in effect the owners father trying to help the club. UEFA said no go on that sponsorship deal (or half of it) and that's where City find themselves now

Edit: I should have said that owners can spend their money on infrastructure and other things. Just not on players, wages, etc.

 

[Superhudd]

I don't believe so.

I think UEFA use the generally accepted practice of writing down the value of a player over the length of their contract. I also believe that signing on fees are considered capital costs of a player.

So if you spent £50m on Gareth Barry (lol) and gave him a 4 year contract at £1m per year with a £10m signing on fee, you would have an accounting loss of £15m per year on the player and wage costs of £1m.

In year 2, if you sold James Milner for £20m (lol) then you would recognise that immediately, so for year 2 you would recognise a profit of £4m (assuming no other transactions and all other players fully written down).

If, in year 3 you offer Barry a new contract (lol) then the signing bonus would be capitalised and written off over the new contract.

So in your scenario, you'd have to wait until all the expensive players had their values written down and had signed new contracts before you could sneak in.

So they could offer 6 month contracts then.

 

[clevelandspur]

Owners cannot just inject cash into the club any more. Clubs must be self sustaining. Unless the club has legitimate income to offset against the spend it will appear as a loss in their books and will be further in breach of FFP rules. City tried unsuccessfully to boost their numbers with sponsorship which was in effect the owners father trying to help the club. UEFA said no go on that sponsorship deal (or half of it) and that's where City find themselves now

Edit: I should have said that owners can spend their money on infrastructure and other things. Just not on players, wages, etc.

Ok thanks that explains it better than what I knew it as. Still seems there is plenty of gray area for clubs to get around this though.

 

[Rorschach]

Ok thanks that explains it better than what I knew it as. Still seems there is plenty of gray area for clubs to get around this though.

Not gray enough for City and PSG it appears.

Real are pulling a fast one too by selling their training ground to the city for 400mil. State aid by another means.

 

[scaramanga]

So they could offer 6 month contracts then.

You could, but you need to submit 3 years of accounts, so you'd need to give 6 month contracts and then somehow keep a mercenary player who can now command a £20M+ signing on fee at any club in the world from leaving on a Bosman for 2.5 years.

 

[SWP29]

No I was not but what is the relevance of that in regards what I wrote. I suspect instead of replying to the points made is because you know deep down how your club has behaved has been immoral which makes your continue support of them immoral in my opinion.

Were the same to happen at Tottenham and we were brought by a free spending billionaire we would have choice to make and I understand it would be a dilemma as we all want to see our team successful. But as when the mooted move to Stratford was talked about I would have been part of the group that would have formed and been a fan of FC Tottenham.

The fact that you stayed and supported City does not make you a bad person but it does show your attitude towards ethics especaily regarding money and rather debunks any opinions you have the subject as it smacks of self interest and one wonders whether your actually employed by City in some capacity such is your haste in always defending the indefensible.

Will reply to this tomorrow. Just want to say that I have never said that I am against FFP, I'm for a way to curb our spending. It is and always has been excessive.