I think with FFP, incoming transfers you count the whole fee, whereas outgoing it’s accounted for over the course of the contract
So say if we got 20m for Digne, and spent 30m combined on Patterson/Mykolenko over 5 year contracts, 6m would be going out and 20m would be coming in
That could be complete bollocks though, and might depend on how we structure the fee
Why? I’ve just explained how it’s possible, obviously other players will be going out the door I’d imagine. And we all dont know how much we maybe need to bring in to cover debt, that’s another issue.
But selling Digne for 20/25 mil will easily cover 3 of those 4
Firstly, that assumes that we can pay in instalments over the length of the contract. Rangers certainly aren’t accepting that.
Secondly, it also assumes that tgd money isn’t required to service existing debt. There appears to be a belief that a £20m sale permits £100m spending???
Most transfers are paid in instalments. Rarely does any club pay in full, especially for multi million transfer fees.
Existing debt that requires servicing would have been covered by revenue. Someone has explained how the accounting work for FFP. Everton has money. Just not allowed to spend it. The situation is a little unique compared to say a club who literally doesn't have money to spend.
I’m no expert on how the finances work, but I think it’s got nothing to do with what we pay Rangers. It’s how we put it through our yearly books. Siggurdsson costs 9mil a season on the books, 9x5 = 45mil. I’d like a bet that our agreement with Swansea on how we paid the 45mil was a bit different.
Selling a player the profit goes straight into the accounts, buying is different, it’s spread over the contract, that’s why Liverpool selling coutinho allowed them to buy a number of expensive players.
Ive explained this in detail a few times.
Heres how it works:
Player is signed for £18mil. No matter what the agreement on how this is paid between clubs, whether all immediate or staggered its irrelevant for FFP.
Lets say that player has signed a 5 year deal which means the £18mil ÷ 5 equates to £3.6mil a year dropping off his transfer fee and showing a decreasing 'book value'.
Now, i cant be bothered to calculate month to month but Digne extended his contract in Feb 2021. At that time he had played for the club from summer 2018 - early 2021.
Lets call it 2.5 seasons or £3.6mil × 2.5 = £9mil.
At that point he extended his contract so his book value became £9mil which is then spread over another 4 seasons (approx) which is £2.25mil a season.
If he leaves in Jan then thats £9mil - £2.25mil = £6.75mil.
So he has a book value for FFP purposes of £6.75mil.
If the club chose to sell Digne for £26.75mil then that becomes a £20mil profit based on the current FFP book value.
Again, workings are general not exact on the months / fees.
Then simply remove the boys wages from the wage bill and that also becomes an FFP saving....instantly.
Now, to sign players its different.
Take that £20mil profit weve made above. We can use that immediately as its a 'realised' FFP profit.
That means (using the same contract calculation as before) we could spend £100mil in January.
How is that possible? Over a 5 year contract with FFP we pay £20mil a year, so that totals £100mil over 5 years.
E.g we could sign 5 players for £20mil each = £100mil.
FFP year 1 = £20mil (Digne profit)
FFP year 2 = £20mil
FFP year 3 = £20mil
FFP year 4 = £20mil
FFP year 5 = £20mil
So, in theory we can use the entire £20mil this Jan to sign £100mil worth of players...but we need to pay another £80mil over another 4 years.
Is this stupid? Well, in theory no because we will have saved wages on out of contract players of Sigurdsson, Delph, Tosun and Kenny which probably covers £15-16mil a year. Player wages are probably covered by James/Digne leaving.
So we'd be in the red by £4-5mil for the next 4 seasons which is not a big deal and easily solved with a tiny sale or contract restructuring here and there.
Again, all figures are approximate etc etc
