Everton, our summer transfers and short term cost control regulations

[Efcjake]

They broke an agreement regarding their finances with the Dutch FA.

No different here.

It is different biz. See my last post about allowed losses if the club's owner can cover it.


On one hand you have a Dutch team who are in financial trouble making deals to buy players using 3rd-party investors.

On the other hand you have us looking to increase our wage bill and able to pay for it in the short term out of the club owner's pocket until such a time when the infrastructure investments return a profit. As far as I can tell Everton would be above board.

 

[JimEFC]

Has the PL ever punished a team for exceeding allowed expenditure on salary increases?

I remember Man City getting punished over that but it was by UEFA and not by the Premier League.

http://www.bbc.com/sport/football/27445475





From that same article:




Which, if Farhad can cover the losses out of pocket, and he can, then we can grow the team salary expenditure without having to rely on the revenue growth to support it in the immediate present.

Yep, City and Abu Dhabi knew the fine was coming anjust thought 'the hell with it, we'll pay it when it comes" because the benefits on the pitch were more important.

 

[Efcjake]

Yep, City and Abu Dhabi knew the fine was coming anjust thought 'the hell with it, we'll pay it when it comes" because the benefits on the pitch were more important.

But if you look at that article and all the others about it you will see the Premier League couldn't care less about it, just UEFA getting the knickers twisted.

We aren't in European competition so what is actually stopping us from sticking two fingers to their restrictions besides a couple of fines?

 

[The Esk]

So the revenue calculation is sale value less net book value of the player in the balance sheet.

Any idea If The players transfer fee is split across the length of the initial contract or can the annual depreciation charge hitting the p&l be rolled into any new contract thus reducing the annual charge on for example lukakus current deal once he signs a new contract.

First paragrah is correct.

If the contract is extended the residual value is then depreciated across the length of the new contract

 

[JimEFC]

It might have already been mentioned, but is there a case for flogging Coleman? Given that we've supposedly knocked back interest in him a few times over the last few windows, there's definitely room to make a massive chunk of player trading profit here. He's failed to hit anywhere near the standard set in the first season under Martinez and attacking though he may be, he is quite limited if you ask me, bar that boss game against Arsenal.

That's not to say I would advocate it myself as I think he'll improve in a side actually coached properly on how to defend, and he seems a nice lad to have around; me personally I believe the City ITK's on Stones for 45m to City, and that will fund it. However it is still worth noting at the least.

I'd sell him as well. Probably a banker at about 8-10 million (Wanyama just sold fpr £11m.
Not a bad profit on 60 grand. Been eatching him in the euros and he doesn't stand out in a frankly poor Irish team.

 

[The Esk]

Ha ha but it's true isn't it mate? It's not quite as bright as we all first thought

It is mate. All clubs with low non broadcasting income face the same challenge - that's all accept 6 or 7 clubs at most. We're now lucky that our income can grow to meet future growth in costs and we have players as assets who we can sell (probably just 1) to meet the short term regulatory requirements.

 

[bizzaro]

It is different biz. See my last post about allowed losses if the club's owner can cover it.


On one hand you have a Dutch team who are in financial trouble making deals to buy players using 3rd-party investors.

On the other hand you have us looking to increase our wage bill and able to pay for it in the short term out of the club owner's pocket until such a time when the infrastructure investments return a profit. As far as I can tell Everton would be above board.

No mate. The issues are that they got into trouble over FFP then tried to break the rules to fix it.

We just need to avoid breaking the rules.

 

[bobbydigital]

It might have already been mentioned, but is there a case for flogging Coleman? Given that we've supposedly knocked back interest in him a few times over the last few windows, there's definitely room to make a massive chunk of player trading profit here. He's failed to hit anywhere near the standard set in the first season under Martinez and attacking though he may be, he is quite limited if you ask me, bar that boss game against Arsenal.

That's not to say I would advocate it myself as I think he'll improve in a side actually coached properly on how to defend, and he seems a nice lad to have around; me personally I believe the City ITK's on Stones for 45m to City, and that will fund it. However it is still worth noting at the least.

That's my thinking too. Him and Cleverly cost next to nothing, if you could get 25m for them two would be pretty much sorted. Assuming that the five 120k per week players are able to replace them two plus Osman, Hibbert, Piennar and Howard which they surely could do.

 

[Nymzee]

Does this go hand-in-hand with Koeman saying “Sometimes you need to sign players but if we have that quality in your Academy then that is the best way." in the way that potentially we'll be trying not to spend too much on player fees & wages this summer until we can get a better sponsorship and thus spend more next summer? I wouldn't mind a season with a couple of signings knowing it's all for the benefit of the clubs books and next summer we'd go ham on the market.

 

[Efcjake]

No mate. The issues are that they got into trouble over FFP then tried to break the rules to fix it.

We just need to avoid breaking the rules.

But the infractions are entirely different, that doesn't read like UEFA punished them for breaking FFP like what they did to City, that reads like it was the Dutch FA's decision.

 

[Efcjake]

@bizzaro and @The Esk



From the UEFA site: http://www.uefa.com/community/news/newsid=2064391.html

stage in the future.

3) Are clubs no longer allowed to have losses?

To be exact, clubs can spend up to €5million more than they earn per assessment period (three years). However it can exceed this level to a certain limit, if it is entirely covered by a direct contribution/payment from the club owner(s) or a related party. This prevents the build-up of unsustainable debt.

The limits are:
• €45m for assessment periods 2013/14 and 2014/15
• €30m for assessment periods 2015/16, 2016/17 and 2017/18

In order to promote investment in stadiums, training facilities, youth development and women’s football (from 2015), all such costs are excluded from the break-even calculation.






So this reads to me like it says we are allowed to exceed the caps on salary expenditure increases so long as Moshiri can cover the loss.

 

[bizzaro]

@bizzaro and @The Esk



From the UEFA site: http://www.uefa.com/community/news/newsid=2064391.html

stage in the future.

3) Are clubs no longer allowed to have losses?

To be exact, clubs can spend up to €5million more than they earn per assessment period (three years). However it can exceed this level to a certain limit, if it is entirely covered by a direct contribution/payment from the club owner(s) or a related party. This prevents the build-up of unsustainable debt.

The limits are:
• €45m for assessment periods 2013/14 and 2014/15
• €30m for assessment periods 2015/16, 2016/17 and 2017/18

In order to promote investment in stadiums, training facilities, youth development and women’s football (from 2015), all such costs are excluded from the break-even calculation.






So this reads to me like it says we are allowed to exceed the caps on salary expenditure increases so long as Moshiri can cover the loss.

These club - wage increase restrictions are Premier League rules in addition to FFP.

They are designed to supplement them as it was deemed that the loses clubs were making even in the face of increasing tv revenues was unsustainable.

They are not individual player wage restrictions and therefore are perfectly legal under EU law.


They are designed so that the tv deals being received now - are not entirely lost due to wage inflation from TV money.

Its designed to reduce 'risk' within how clubs operate.

@The Esk is - trying to circumvent risk restrictions - in part - or wishes to.


This is why i have said we should space our acquisitions over two summers. Not one. Less pressure on the club. We don't need to sell and can acquire players more gradual than in one ridiculous summer.

We both want the same. We disagree on timescales.

 

[Efcjake]

These club - wage increase restrictions are Premier League rules in addition to FFP.

They are designed to supplement them as it was deemed that the loses clubs were making even in the face of increasing tv revenues was unsustainable.

They are not individual player wage restrictions and therefore are perfectly legal under EU law.


They are designed so that the tv deals being received now - are not entirely lost due to wage inflation from TV money.

Its designed to reduce 'risk' within how clubs operate.

@The Esk is - trying to circumvent risk restrictions - in part - or wishes to.


This is why i have said we should space our acquisitions over two summers. Not one. Less pressure on the club. We don't need to sell and can acquire players more gradual than in one ridiculous summer.

We both want the same. We disagree on timescales.

So this 7 million figure for increases is the Premier League's rule?

 

[The Esk]

So this 7 million figure for increases is the Premier League's rule?

correct, google short term cost control rules premier league. - it relates specifically to capping the increase in salaries to £7 million a year, each year for the next 3 years unless there is a corresponding rise in non-broadcasting revenues.

 

[The Esk]

This is why i have said we should space our acquisitions over two summers. Not one. Less pressure on the club. We don't need to sell and can acquire players more gradual than in one ridiculous summer.

I don't believe Moshiri will do this, he'll want a complete acquisition programme this summer. He can fund the increase in salaries which is purely a technical restriction either by as I say a player sale or by boosting sponsorship revenues. My view is he'll allow 1 player to leave to achieve this - Stones is the ideal candidate and wants to leave for City anyway.