Everton Transfer Thread 2016

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From the article that @MoutsGoat posted

Despite what you may have heard, “net spend” is completely irrelevant to how big clubs do business and is not something they consider when calculating player costs. Consider the following: Manchester United signed Henrikh Mkhitaryan from Borussia Dortmund for £35m. Mkhitaryan will likely be earning the equivalent of at least £180,000 per week over the length of his four-year deal.

In practice, clubs such as United, for whom cash flow is never an issue, often pay the entire transfer fee up front or in a few instalments over a short period of time (less than 12 months). This helps reduce the overall cost of the transfer, and most selling clubs will much prefer to see the entire fee paid quickly, as opposed to several instalments over two or three years.

However, on the books – and this is how clubs actually calculate player costs – United, like every single other football club in Europe’s top eight leagues, will record the transfer fee as £8.75m in each of the next four years, not £35m now.

This is a universal accounting practice called player amortisation, and it is fundamental to how clubs calculate player costs. Rather than recording the entire purchase when it was made, the club will spread the transfer fee over the length of the player’s contract.

Naturally, wages must also be included in the calculation of player costs. Ideally, agent fees and image rights payments will be included as well, but to keep things simple, we’ll focus on the two big expenditures: amortisation and wages.

With Mkhitaryan costing Manchester United £8.75m per year in amortisation and £9.36m in wages (£180,000 per week multiplied by 52 weeks), his overall cost to the club is just over £18.1m per year. That £18.1m per year is what clubs look at with regards to player costs, not just the transfer fees coming in and out.

Let’s compare the Mkhitaryan deal to that of another recent Premier League signing from the Bundesliga: Arsenal’s £30m purchase of Granit Xhaka from Borussia Mönchengladbach. Xhaka signed a five-year deal and will reportedly earn around £125,000 per week at Arsenal. The transfer fee will be spread out over Xhaka’s contract at £6m per year (£30m divided evenly over five years). So including Xhaka’s wages, the overall cost to Arsenal is £12m per year.

While the transfer fees for Mkhitaryan and Xhaka are similar, Mkhitaryan is costing Manchester United 50% more than Xhaka is costing Arsenal on an annual basis.

To further illustrate why net spend doesn’t tell you anything about how clubs do business, consider United’s signing of Zlatan Ibrahimovic on a free transfer. While the “net spend” on that deal is zero, he adds well over £10m to Manchester United’s player costs this year.

If those were the only transactions United and Arsenal made this summer, their “net spend” figures would be similar (£35m and £30m, respectively). However, after applying the business and accounting principles that the clubs themselves use, we see that Arsenal added £12m to its total player costs for the coming season, while United added over £28m. Rather than a difference of less than 20% in actual spending (which is what net spend would show), the actual difference is over 200%.

...and wasn't the club behind bringing this accounting practice to the fore...er...Everton ? Good old us !!
 

Nothing has happened for days. The whole transfer window seems to have gone on forever. 7 days to go the deadline and I should be jumping and up and down with excitement but instead I'm now bored of the whole thing. A right back at Southampton who played 15 times last season without me noticing and two guys from Spain and Italy I hadn't heard of prior to 2-3 days ago. Hart...yes, no, maybe..
 
So now were including, Manager payouts and the purchase of land as part of the transfer kitty....

seriously......you mad bro!!!

Clubs do not have transfer budget, war chests and kitties
If anyone tries to tell you “big club x” has “y amount” to spend they are likely talking nonsense. Ask them to show their work on how they arrived at that number.

As we just discussed, there’s a lot more that goes into player costs than transfer fees. Unless the number being offered up clearly includes wages (which is more than half of the equation), and ideally at least a nod towards agent fees and image rights payments, you can safely disregard it as not reflective of that club’s available resources to bolster its squad.

from the article that mouts goat just posted
 
I'm sure the transfer window was set up to protect the less affluent clubs from having their best players poached whenever the 'big boys' clicked their fingers. Now that everyones minted, can't they just scrap this fiasco. The kids will be able to concentrate on homework and such like.
 

I,m surprised he missed a trick to add the cost of the cladding to the ground.

He so far up the clubs backside he might as well be working out of the club's offices. ;)

hahahahahahhaah

and the new pukka pies there selling in the upper bullens.



Soz boyz, no new signings, we've just sorted 600 curry pies for the new season...jobs a good'un
 
I,m surprised he missed a trick to add the cost of the cladding to the ground.

He so far up the clubs backside he might as well be working out of the club's offices. ;)

Tbh I wish I was working for the club - dream job and all.

But no, all I did was quote an earlier poster who went someway to explaining the money that has been spent this summer.

I'd tell you to read the original post and stop being a tit, but that would be a bit much for you wouldn't it.
 
Clubs do not have transfer budget, war chests and kitties
If anyone tries to tell you “big club x” has “y amount” to spend they are likely talking nonsense. Ask them to show their work on how they arrived at that number.

As we just discussed, there’s a lot more that goes into player costs than transfer fees. Unless the number being offered up clearly includes wages (which is more than half of the equation), and ideally at least a nod towards agent fees and image rights payments, you can safely disregard it as not reflective of that club’s available resources to bolster its squad.

from the article that mouts goat just posted

I normally agree with most points you make but when 'newspapers' and ITK's, not accountants say a club has a £100m warchest to spend they're talking about the amount available for transfers.

As it stands, so far, everything we have spent up until this point is covered by the sale of Stones + extra TV money. We should have money still available just from TV money alone. It's looking doubtful Moshiri will have invested any of his personal money, other than clearing our debts by the end of the window unless we make a big signing or sign more players than seems likely.

Hope I'm wrong, but I don't think shifting the goalposts, to try and make out that £100m warchest included everything inclusive and on top of transfer fees is justification for saying we did have that amount available.
 

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