6 + 2 Point Deductions

[MikeH72]

Nottingham Forest: Club expect to avoid FIFA punishment over transfer administration error

Nottingham Forest expect to avoid FIFA punishment despite a transfer admin error regarding Jonjo Shelveys move to Trabzonspor last summer; the transfer was initially a loan that breached FIFAs rules on the number of international loans allowed which is seven per club

www.skysports.com

No punishment for Notts.

That’s not even related to P&S

 

[Bebeto]

That’s not even related to P&S

Shelvey move is a strange one as it seems he essentially got a free move to Turkey meaning that he must have got a pay off from forest...be interesting to see how is that reported though on their accounts.

 

[Goodisongang]

Ah I didn't even read the article re forest, juat assumed it was saying no punishment re their FFP,

 

[mikel_88]

Ah I didn't even read the article re forest, juat assumed it was saying no punishment re their FFP,

Think it is after the 15th jan that comes out

 

[HalfTimeSayers]

Are Forest in this position as they sold Johnson for £20m more in August? Shpuld tgey have lost £20m on his value to sell by 30th June? I get that its within the rules but surely the fact that they made an extra £20m on a player in a couple months is better for the clubs financial position.

Isnt it a similar argument we used having to sell Richarlison for less as Spurs knew we had to sell by 30th June?

I don’t see his point.

If you have a car in stock for £100k and sell it 2 days after the end of the accounting period for £80k, that is solid evidence your stock was overvalued at year end, and on audit will probably be required to provide for the loss within the accounting period. You don’t uplift stock value as you think it becomes worth more, you just make more gross profit when you sell it. You never ever go back and push profit into a prior period based on excessive profit earned subsequently.

Players are different, they are fixed assets. You don’t value fixed assets at the lower of cost and net realisable value, you record at cost then depreciate/amortise over their useful economic life or contract length if relevant. You may impair fixed assets if they cease to be useful etc. I’ve sat with a PL manager discussing player by player whether they needed impairing, he couldn’t have been any less interested. And rude.

Anyway, Forest don’t need to prove Johnson was worth more at the close of the accounting period. That gains nothing.

To be really obtuse, you could say they could have sold for the lower value before the accounts closed (as we did with Richy) and complied with PSR but chose to deliberately delay to sell for more, and those extra funds could be reinvested - presto - a deliberate breach resulting in a sporting advantage.

It’s all nonsense. Football and accounting should not be so entangled as they are now.

 

[kenada_blue]

Why? The clubs should be able to provide audited accounts within 6 months after their FYE. There's really no reason to prolong it further.

Sure. But it's the switch of 12 months from March to March now to December to December.

At least there's 2 transfer windows in the 1 season, rather than 2 spread over 2 seasons.

Just seems to be squeezing clubs that may need the market for the balance sheets. Could be wrong

 

[BlueandBald]

Maybe Forest thought that ambulance chasing was a way out of their impending financial issues and subsequent sanctions. I’m still intrigued as to how they would of been affected by Everton and had recourse for suing our club though, seems utterly laughable.

They're a scummy club and a scummy City. Personally, I hope they go down.

 

[Tin-Tin]

There has to be a cutoff date in order to apply the rules, or there would be no rules to apply.

They can't make an argument saying they knew at 06/30/2023 that Johnson would garner 20m more and not injure himself before the transfer.

The sustainable part would have been not buying and paying all those mediocre or worse players (for both clubs). Then the financial need to sell those players is removed.

I don’t see his point.

If you have a car in stock for £100k and sell it 2 days after the end of the accounting period for £80k, that is solid evidence your stock was overvalued at year end, and on audit will probably be required to provide for the loss within the accounting period. You don’t uplift stock value as you think it becomes worth more, you just make more gross profit when you sell it. You never ever go back and push profit into a prior period based on excessive profit earned subsequently.

Players are different, they are fixed assets. You don’t value fixed assets at the lower of cost and net realisable value, you record at cost then depreciate/amortise over their useful economic life or contract length if relevant. You may impair fixed assets if they cease to be useful etc. I’ve sat with a PL manager discussing player by player whether they needed impairing, he couldn’t have been any less interested. And rude.

Anyway, Forest don’t need to prove Johnson was worth more at the close of the accounting period. That gains nothing.

To be really obtuse, you could say they could have sold for the lower value before the accounts closed (as we did with Richy) and complied with PSR but chose to deliberately delay to sell for more, and those extra funds could be reinvested - presto - a deliberate breach resulting in a sporting advantage.

It’s all nonsense. Football and accounting should not be so entangled as they are now.

I get their has to be a cut off. Im talking scrictly from a clubs pov, nothing do do with the rules though. How does losing £20m on a player for the sake of 2 months help a club be more sustainable?

 

[Yarrgh]

Corrupt

 

[Wat Tyler]

 

[Caolam]

If Everton manage to avoid relegation despite the 10 point deduction then the punishment regime put in place by the PL doesn’t work. If this is the case then those teams which are relegated then start litigation against the PL and/or Everton, either way a huge mess ensues. It is a much better scenario for the PL if Everton get relegated and the 10 points deduction is the reason they go down. It is the PL’s nightmare scenario if Everton can accrue enough points to stay up, it helps the PL if their situation is helped by a little “unconscious“ bias against the club, what if referees started giving bad decisions against them, either VAR or otherwise. What if penalties are awarded against the, what if foul play against them in the box goes unpunished or if important players are sent off for minor infringements and are missing for important games.
The points deduction system is a two tier punishment regime, if you are a good enough team to be able to avoid relegation despite a points deduction then the penalty handed down to you is much less than that on a club who lose their Premier League status.
I realise that a points deduction means you finish a bit further down the league and therefore lose prize money, but again if you are a successful club you are in a much better position to take the financial hit than a lower level club. If the underlying punishment is purely financial then be honest and say so and just fine clubs an amount commensurate with their crime and ability to pay, it is in no one’s interest to bankrupt a club.
If the PL feel that the infringement committed should be punishable by relegation then they should have the strength of their convictions and just remove the club from the league.

 

[pfim]

I don’t see his point.

If you have a car in stock for £100k and sell it 2 days after the end of the accounting period for £80k, that is solid evidence your stock was overvalued at year end, and on audit will probably be required to provide for the loss within the accounting period. You don’t uplift stock value as you think it becomes worth more, you just make more gross profit when you sell it. You never ever go back and push profit into a prior period based on excessive profit earned subsequently.

Players are different, they are fixed assets. You don’t value fixed assets at the lower of cost and net realisable value, you record at cost then depreciate/amortise over their useful economic life or contract length if relevant. You may impair fixed assets if they cease to be useful etc. I’ve sat with a PL manager discussing player by player whether they needed impairing, he couldn’t have been any less interested. And rude.

Anyway, Forest don’t need to prove Johnson was worth more at the close of the accounting period. That gains nothing.

To be really obtuse, you could say they could have sold for the lower value before the accounts closed (as we did with Richy) and complied with PSR but chose to deliberately delay to sell for more, and those extra funds could be reinvested - presto - a deliberate breach resulting in a sporting advantage.

It’s all nonsense. Football and accounting should not be so entangled as they are now.

That's what he's pointing out in the 2nd tweet. You don't realize a gain on fixed assets based on market value, only impairments can exist.

It's even more nonsensical than our contention that we sold Richarlison at a lower value to be in compliance.

 

[pfim]

I get their has to be a cut off. Im talking scrictly from a clubs pov, nothing do do with the rules though. How does losing £20m on a player for the sake of 2 months help a club be more sustainable?

It doesn't. But the rule is there and needs to be followed.

I also think your line of thought is based on a false premise: That they would still sell him if they rules did not exist. They bought all these players on big fees and wages, and likely would have given him even more wages to keep him, which is not sustainable either.

 

[NathDogg]

Clearly the biggest issue with our current problems with P&S is that we couldn’t work with Usmanov and USM due to the rules & sanctions that the PL had put in place on the russia/ukraine war.

Now, deals linked to businesses with clear links to Russia are deemed acceptable?! Didn’t know the conflict was over?
Checking club badge again.
Has to be another point on the appeal list, to add to the myriad other blatant discrepancies in our case.

 

[Tipp blue]

Ever club outside the top 6 is now sell to buy for good. Thats the outcome of the financial regs ‘saving’ us all. If Forest get relegated because they’re deducted 10 points and end up in administration I’d love to know how the financial regs had saved them.

If sustainability rules drive clubs into administration then the PL will find themselves in real court without a leg to stand on.