Financial Fair Play investigation

[watchsouthalltrain]

I read many reductionist takes on the site so far that preclude the possibility of a points-deduction on the basis that it would set precedent against Manchester City. This is the same Manchester City whose Chairman is a high profile, VIP individual in the UAE Khaldoon Al Mubarak whom was yesterday quoted in an RT bulletin as decrying the deterioration of the situation in the West Bank.

Exactly. It's politics. Not business, as usual.
The Americans view the English sport as a dominion where they can exert so-called 'soft-power'. The want competition shut-down. Everton being the very edifice of precisely what they do not want, legitimate competition a stones throw away from them figuratively and literally. Its creeping anti-competitive manifestations include recently: The literal embodiment of this by the Super League attempt. And to my own observation the no longer dubious refereeing but match-fixing level of officiating.

Everton, however have the resources to stick a spanner in the works if they choose to do so. It's not so much the charge which is peculiar but the outcome that is to be looked to as revelatory as to where the club is going.

Points deduction incoming. Setting up Manchester City for the big fall...

 

[indieman1]

Oh, I think there are.

Anyway, the worst we're looking at here is a transfer embargo - which would be bad enough but not deadly. If the PL and that commission (made up of an independent chair and 3 people on the PL judicial panel) look at points deductions they'll open up a pandora's box.
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The PL will be hoping we get relegated this season to make matters easy for them.

We'll be lucky to survive this season. Add in a transfer embargo for summer and winter and we are sunk without trace.

This impacts on everything. Youth recruitment. First team recruitment. Stadium financing. Sponsorship.

Our owner is the width of a rizzla from sanctions. No one with any sense of a future is going to touch us with a barge pole.

Dyche ball for the next decade.

 

[St Domingos]

Are they gonna start losing £100m per year as well or somethi

Are they gonna start losing £100m per year as well or something?

 

[Rita_Poon]

Come on, work with me...

 

[catcherintherye]

No it is UEFA's FFP that has rolled two accounting periods into one to allow for COVID losses.

The Premier League chose a different path and allowed clubs to exclude losses that could be attributed to COVID.

Apologies mate, but this is manifestly untrue.

The PL allowed for seasons to be merged. It seems a small detail, but its significant in this instance as 17/18 is a year with a small loss, whereas 18/19 is a big loss.

The fact that such an incidental detail becomes so critical sort of highlights the absurd stupidity of these rules.

 

[Bkk Andy]

A transfer embargo would be pretty bad for a club which has spent 2 years in or just above the relegation zone like.

A transfer embargo is effectively delayed relegation. We'd need to sell in order to sort the finances but couldn't replace meaning we'd only get weaker.

 

[St Domingos]

Ofcourse clubs will lose 100 mil, but we get the torch on us co's we are a nice soft touch and our malignant board allow it. We are Everton not f........g Brighton, Burnley, Newcastle and the rest of the no marks.....respect MikeH72 btw

 

[catcherintherye]

It has gone way past the stage of an inquiry.

The first time we posted losses of £15m+ we had to provide the Premier League with financial projections for the next two years plus evidence of secure funding.

Quite obviously we haven't been able to fulfill the financial projections we made. That means we have been charged with failing to meet P&S losses and have been charged and referred to a 3-man Independent Commission.

Again, this is untrue.

Everyone provides projections. That is not some unique situation for Everton. Accounting works, partially at least on projections.

Until we see the accounts, we cannot say whether we have, or have not met the projections.

We have not been charged. It is not going to a 3 man commission. The PL have referred it. They havent said there has been any breach at this point.

So theres a lot of conjecture there.

If we end up being found guilty, I strongly suspect as for a first offence we will likely get a warning and told to sort it out for next year. Anything much beyond that, certainly with points deductions for next season will likely drag on for years. It would be unduly stupid, given how they have treated City, to start with that if guilt is established.

I can say a summer window embargo at the upper end.

The accounts will get better next year, as 18/19 was an unprofitable year, and this is a profitable one.

The rules are a complete farce though, and I hope the club take it all the way to CAS. They allow Chelsea to soend 650m in one season,while penalizing us for a season we made a net 30m profit on transfers. How is that about levelling competition? I'm sure the courts outside of the corrupt edifice that is the Brexit island will take a dim view of it.

 

[catcherintherye]

No, but the Premier League has and has referred us to an Independent Commission for breaching P&S rules.

When you look at our revenue and expenditure then it was pretty much inevitable.

But again, unless you have seen the accounts, we have no idea what either are.

 

[St Domingos]

We'll be lucky to survive this season. Add in a transfer embargo for summer and winter and we are sunk without trace.

This impacts on everything. Youth recruitment. First team recruitment. Stadium financing. Sponsorship.

Our owner is the width of a rizzla from sanctions. No one with any sense of a future is going to touch us with a barge pole.

Dyche ball for the next decade.

How is Dyche ball right now? Just asking fella.

 

[catcherintherye]

It's far more complex than that. There are permissible deductions that kick in between the raw accounts and the P&S calculation. Things Like money spent on the Women's team, Youth teams and spending in the community.

Then there is the big kicker losses due to COVID. Even though COVID is pretty much over we presumably could be claiming losses for COVID. For instance, still paying wages for players we would have expected to have offloaded if it were not for the effect COVID had on the transfer market.

One inkling I have, is the club may have tried to move the figures re Covid again, and the PL have said no, or have perhaps said they are unsure.

It may also be that the Richarlison money wasnt banked in time. Something like the latter would probably get us off, as we could demonstrate it's a technicality, and we would be back into profit this year (and actually 50-60m higher profit).

It looks like the PL want to quibble something. The fact they haven't charged is interesting.

 

[catcherintherye]

We'll be lucky to survive this season. Add in a transfer embargo for summer and winter and we are sunk without trace.

This impacts on everything. Youth recruitment. First team recruitment. Stadium financing. Sponsorship.

Our owner is the width of a rizzla from sanctions. No one with any sense of a future is going to touch us with a barge pole.

Dyche ball for the next decade.

The owner wont be sanctioned now, the situation in Ukraine will only get better from here, and some efforts will need to be made to start building bridges.

There are, and will continue to be interested parties, but only if the price is right and the board go.

 

[catcherintherye]

You are blaming the people who have been telling you what was going to happen for it happening. You have been telling us how clever Moshiri and Usmanov are. You have been telling us Moshiris is an ace accountant and that we will be fine.

It has been obvious for years that we were living way beyond our means. It was obvious that our overspending would catch up with us.

Now you are trying to blame us because you buried your head in the sand and ignored the financial peril the club was being placed in.

Our spending hasnt caught up with us per se though, a ludicrous set of rules, unevenly applied is being used to target us. That doesnt help the business, and it sets arbitrary targets that exacerbate the problem.

These alleged journos as well, how many if them have ushered a single words criticism to the board? Very few.

On the flip side, I have for some years been critical of the board, and have also appointed out how and where improvements need to be made. The thing is, both things can be true simultaneously.

The club needed to be ran better for the good of the club, not because some pen pushers have designed an unjust and unworkable set of rules.

 

[St Domingos]

Are they gonna start losing £100m per year as well or something?

As the quote by Mikheal Rostivik goes, if you have money, you will spend money. MikeH72.....

 

[catcherintherye]

So these are our last losses that apply to the three year cycle.

Year 1) £111m in 2018-19

Year 2) £139.9m in 2019-20.
£120.9m in 20-21

* Year 2: These years are averaged due to Covid i.e. Add them both together and divide by 2 = a loss of 130.35. The club argued that we had crystallised losses of £82.1 mill due to Covid that was accepted by the PL. So the total accepted loss for year 2 is £48.25mill

So our current situation should be this:

Year 1) Loss : £111mill in 2018-19

Year 2) Loss: £ 48.25mill

Year 3) This is the year we are sanctioned for. We needed to make a profit of £54.25 mill to comply with the £105 mill threshold, which the PL is allege we haven't. These set of accounts are to be published next week.

Just a quick question, I'm not sure how this can be right. And Year 0 in your projection is a 13m loss. And we did not fail STCC. So surely Year 3 just as to be better than -13m?