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Post by Macmoish on Apr 19, 2012 6:50:56 GMT
And assuming we do go down, with massive expenses/wages, this surely would impact on us next time we go up? TELEGRAPH/MATT SCOTT - Championship clubs to vote on tough financial fair play plan that would have cost QPR a �15m fineChampionship clubs will vote next week on new rules which would have hit Queens Park Rangers with a staggering �15 million fine upon their promotion to the Premier League last year, Telegraph Sport can reveal. The punitive fines are the central tenet of a new �financial fair play� framework for the Football League�s top flight, as they seek to transform the league�s routine pre-tax losses into profits. If approved, the proposals would also curb the kind of turbo-charged investment that saw Queens Park Rangers legitimately record a �25.3 million pre-tax loss in their promotion season. The proceeds of such eight-figure fines applied on a sliding scale according to the size of a club�s losses would be distributed to those clubs who do comply with the rules. Investment in youth development and the accounting charges relating to past spending on players and stadium-building will be deductible from the calculations. However, crucially, owners will be obliged in future to fund their clubs not through debt but by equity: gifts, not loans. �The fact these are equity contributions makes it far more effective than debt,� Crystal Palace�s co-owner, Steve Parish, said. �As it is, the success of a football club has very little to do with the funds generated in the League. So people don�t even try to improve the business, to attract new fans. They go instead for an overseas investor and aim for the Premier League. By the time that person has become disillusioned they�ve added �20-�30 million in debt to the balance sheet.� Fortunately for QPR, the risk paid off with promotion, making their �22.2 million of new debt easier to bear. For others, the debts are dangerous. Deloitte reported in its 2011 review of football finance that, overall, Championship clubs spend �4 for every �3 they generate. The picture has become so bleak that even evangelical free marketeers are converts to the new thinking. Bristol City�s owner, Steve Lansdown, who made his fortune in financial services, said: �A few years ago I would have been totally against this because I don�t believe in any form of capping. �I believe in the free market and that is what sport and business is all about. But there are a lot of issues in football and I have suffered as an owner, where you can spend excessively. In the emotion of the game it is very hard to curb your instincts.� The fines would apply only to clubs who have been promoted to the Premier League: transfer embargos would apply instead to clubs who overspend and fail to win promotion. Six months ago the rules received the unanimous �in principle� backing of Championship clubs. The Football League is now hopeful of gaining the formal approval of a 75 per cent threshold � 18 member clubs � to introduce the new regulations. If such support is mustered then the first season against which clubs will be judged is the current one, although sanctions will not apply until the 2014/5 season. Even so, the rules must rumble down a rocky road before being implemented. The draft rules, seen by Telegraph Sport, state: �In the event that payment is not made by a promoted Championship club in accordance with [the agreed] timescale, that Championship club will be deemed to have explicitly authorised the League to notify the Premier League of such non-payment and to register the same as a [football creditor] debt due to the League.� It would mean the fines being deducted at source from the Premier League�s broadcasting distributions to its member clubs. So far, the Premier League, which is believed not to have been consulted on the new rules, has yet to provide its consent to this area of the regulations. The Premier League�s concerns for the integrity of its own competition while new members are forced to hand over massive sums in fines could lead to a major future conflict at Gloucester Place, where both organisations are housed. TELEGRAPH tinyurl.com/8xfoeja
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Post by Macmoish on Apr 25, 2012 14:21:12 GMT
UPDATED FOOTBALL LEAGUE League clubs choose Financial Fair Play Posted on: 25.04.2012 The Football League is to implement Financial Fair Play regulations in all three of its divisions, after Championship clubs voted in favour of a breakeven approach based on UEFA's Financial Fair Play regulations. From the beginning of next season, the Championship will join League 1 and League 2 clubs in applying rules that exert greater control over club expenditure with each division having the flexibility to determine their own specific approach. The decision to adopt Financial Fair Play regulations follows a strategic review by The Football League Board which identified the state of club finances as the organisation's greatest challenge. League Chairman, Greg Clarke, said: "On the pitch we have three exciting, competitive divisions with crowds at their highest levels for 50 years. But that success isn't necessarily being reflected on our clubs' balance sheets and we have to remedy that situation or face an uncertain future. "I'd like to commend the Championship clubs for the courageous decision they have taken today. It means that for the first time, all 72 Football League clubs have agreed to take concerted action towards controlling their financial destiny. "Whilst we cannot promise that these rules will deliver results overnight, they will begin to lay the foundations for a league of financially self-sustaining football clubs." Financial Fair Play in the Championship: - Financial Fair Play (FFP) in the Championship will require clubs to stay within defined limits on losses and shareholder equity investment that will reduce significantly across a five season period. - Permitted losses will reduce from an acceptable deviation of £4m for 2011/12 to £2m by 2015/16, with additional investment in certain areas of club infrastructure being excluded (e.g. youth development and community programmes). - The permitted level of shareholder equity investment will reduce from £8m for the 2011/12 season to £3m by 2015/16. - Clubs will be required to provide annual accounts to The Football League by December 1, covering the previous playing season. - Failure to stay within the defined limits will lead to the imposition of sanctions. The sanctions will vary depending on whether the club was ultimately promoted to the Premier League, remained in the Championship or was relegated to League 1. - Clubs promoted to the Premier League will have to pay a 'Fair Play Tax' on the excess by which they failed to fulfil the Fair Play requirement ranging from 1% on the first £100,000 to 100% on anything over £10m. Any proceeds will be distributed equally amongst those clubs that complied with the FFP regulations for the season in question. - Clubs remaining in the Championship will be subject to a transfer embargo until they are able to lodge financial information to demonstrate they comply with the FFP regulations (either for the previous reporting period or a future reporting period). - Clubs relegated to League 1 will not be entitled to any payout derived from the Fair Play Tax and will be required to comply with the FFP rules in operation in that division. - Clubs relegated from the Premier League will not be subject to sanctions in their first season in the Championship, as long as they have met their financial obligations under Premier League regulations. They would, however, be subject to the potential of a Fair Play Tax if they achieved promotion in the first season in the Championship whilst not complying with the FFP regulations. - The first reporting period will be for the current playing season (2011/12), however sanctions will not be applied until the 2013/14 reporting period in order to give clubs a sensible period of transition. To find out more about Financial Fair Play in the Championship click here Financial Fair Play in League 1 and League 2: - League 1 and League 2, clubs have chosen to implement the Salary Cost Management Protocol (SCMP) first used in League 2 in 2004/05, although it will operate at different thresholds in each division. - The SCMP broadly limits spending on total player wages to a proportion of each club's turnover, with clubs providing budgetary information to The League at the beginning of the season that is updated as the campaign progresses. - Any club that is deemed to have breached the permitted spending threshold will be subject to a transfer embargo. Wherever possible, The League will seek to tackle the issue 'at source' by refusing player registrations that take clubs beyond the threshold. - At the beginning of the current season, League 2 clubs reduced the permitted spending threshold to 55% from 60% and this figure will continue to be operated next season. - League 1 clubs are currently operating a 'pilot' of the SCMP with clubs complying with a 75% threshold but with no sanctions being applicable this season. This threshold will reduce to 65% in 2012/13 and 60% in 2013/14 with sanctions (transfer embargoes) being applicable in both seasons. www.football-league.co.uk/footballleaguenews/20120425/league-clubs-choose-financial-fair-play_2293334_2748233Financial Times www.ft.com/intl/cms/s/0/43fe56e2-8ed6-11e1-aa12-00144feab49a.html#axzz1t3tuAqou
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Post by Hogan on Apr 25, 2012 14:56:56 GMT
Wow, this is quite a strong postion they have decided to take and in the long term can only be good for the financial well being of clubs.
I am sure accountants and financial analysts within some clubs will be instructed to find loop holes, meaning those within the financial means will be able to speculate in order to get to the promised land.
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Post by RoryTheRanger on Apr 25, 2012 15:01:46 GMT
Surely the loopholes will revolve around sponsorship deals. Clubs will find a way round it.
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Post by Hogan on Apr 25, 2012 15:06:37 GMT
Indeed, for example a season by season sponsorship of the shirt for say £7M from Air Asia, A £5M sponsorship of the SAR stand from Malasian Airlines and an £8M deal for stadium sponsorship from Tune Group. Clean accounts and no fines or penalties. They would rather pay silly amounts themselves in sponsoring the clubs they own than to pay those kinds of amounts in penalties.
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Post by Macmoish on May 1, 2012 11:51:14 GMT
Although maybe not QPR! When Saturday Comes - Andy Lloyd-Williams How Financial Fair Play could help Championship clubs ~ Last week it was announced that 21 of the 24 Championship clubs have opted to introduce Financial Fair Play (FFP) measures. Under the new rules, clubs will be required to provide accounts to the Football League by 1 December each year highlighting their revenues and costs. The new regulations are based on UEFA's break-even model and come after the Football League revealed the 72 clubs of the Championship, League One and League Two are on course to accumulate debts of £2 billion. Clubs that make excessive losses will be punished with fines and transfer embargoes. The clubs will be eased into the new rules, with some leeway allowed over the next few years in the form of a "financial funnel", which permits diminishing losses over the coming seasons. Owners can also put money into the clubs through "equity investments", cash from an owner or benefactor that comes in the form of shares rather than debt. This model prevents owners from burdening clubs with loans they will struggle to repay. Next season clubs will be able to make losses of £4 million and receive equity investments of £6m. From 2015-16, these figures will be reduced, with clubs permitted a £2m loss and £3m investment from an owner. From then, clubs that make losses will be placed under a transfer embargo. Teams promoted to the Premier League that break the regulations in their promotion season will have to pay a "tax" to Football League clubs. Those relegated to League One and found to have been in breach of the rules while in the Championship will not receive their slice of the tax pie. As well as deterring big spending on bringing in players, the measures encourage investment in youth development and community schemes by not including them in the spending limits. In layman's terms, clubs should be deterred from splurging money on "buying promotion" and will instead be encouraged to build solid foundations. Football League chairman Greg Clarke says the measures, two years in the making, were put together to prevent a train wreck: "They will begin to lay the foundations for a league of financially self-sustaining football clubs." Portsmouth and Port Vale have both entered administration this season, with former Football League club Darlington following suit. Conference outfit Rushden & Diamonds, who were in the third tier just eight years ago, were liquidated before the season began. It is great that people with money want to bring success to a club but too often they spend beyond their means, leaving the club to suffer long after the owner has tired of their plaything and walked away. Hopefully the new rules will stop clubs getting into the kind of sorry state Portsmouth are in. After spending big, Pompey went from Championship mediocrity to a top-half Premier League finish in just five years, with an FA Cup win leading to a UEFA Cup campaign and a famous 2-2 draw with AC Milan. When the money dried up, the club went into freefall. They have just slipped into the third tier for the first time since the 1982-83 season. There is still a chance they might not kick a ball come August, with administrators laying off staff and a series of creditor meetings taking place. Portsmouth are left with nothing but memories of the good times. Under te new rules they might have had a fruitful academy producing the young players they need to lead them to the League One title. Instead they have a line of angry creditors wondering if they will ever be paid the money they are owed. Sensibly, the financial calculations do not include the sale of fixed assets (excluding players). So clubs will not be able to sell their ground in order to avoid penalties. Stadiums such as Fratton Park will be more protected from quick-fire sales than they were before. Sceptics propose that owners will be able to find loopholes in the rules. Could a Championship club, for example, spend heavily during the summer transfer window in order to virtually guarantee promotion and then not need to spend any money in the January window and not particularly mind throwing Fair Play tax crumbs back into the Football League pond they just have climbed from? There may well be ways for clubs to get around the rules, but the League should be able to react and seal off those paths. Do not say it too loudly, but one of football's governing bodies may have made a hugely positive impact on the game. Andy Lloyd-Williams www.wsc.co.uk/content/view/8544/38/
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Dave Sexton
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Post by ingham on May 1, 2012 13:52:02 GMT
Might make them think. At QPR, for instance.
A £25 million loss last season? On top of the £50 million plus debt the Club admitted to in the last set of accounts?
To now, this meant nothing. Each Club deludes itself that it will make hundreds of millions once its genius owners, its wonder manager and the fabulous talented players - not to mention the giant (25,000-30,000) capacity new 'home' - endowed them with income far in excess of any possible losses for the more or less indefinite future.
Now what happens to these long term losses? If you hope for a windfall of maybe £40 million in a single Premiership season, you can bluff the people you sell the shares to that somewhere down the road, they'll make money too.
But what happens when there's no money to make, just lower league income, no profits, and the modest attendances such Clubs can expect if they can't spend £25 million on winning promotion from the second tier?
Certainly, they'll try to run rings round the 'authorities', using dodgy companies, and the sort of deception supporters are used to now. I'm not sure I believe the accounts as things stand. The sort we get at QPR, the moneylenders, chancers and property speculators who are also established football incompetents and losers hardly inspires belief in the Club's future. Not if they have anything to do with it. And especially not at the rate they siphon money out of the Club's accounts to squander on almost anything except success and profitability.
The potential for disillusionment is considerable. Without the money, what about the players? Back to the sort of donkeys and farm boys we see in the England team? Rock bottom ticket prices to lure supporters along, or £40 a game to claw back some money for the shareholders to pocket.
And what about the Grounds? The only assets worth having, and one way for the sort of speculators who run the Clubs to recoup their loans. With the government favouring development, there's no reason why new grounds shouldn't be bulldozed to build homes and business parks. The Clubs can be sent on their travels, or dumped on a 'temporary' site they'll still inhabit 30 years later.
If the finances of the game don't work NOW, and Clubs can't even balance their books with injections of TENS OF MILLIONS every so often, on the basis that they win promotion now and then - how will it work in future?
We could assume the altruistic gentlemen who run the Clubs - they are mostly gentlemen - will just take it on the chin themselves. But maybe they aren't altruistic gentlemen at all. Maybe they're greedy, self-serving, and predatory by nature.
But that can't be the case. If it were, QPR would be losing tens of millions in a single season, while its benefactors departed as wealthy as they were when they arrived, if not more so.
Why is it, just as a matter of interest, that these 'businessmen', celebrated for making money in almost any other field, never make a penny in profit for the Clubs whose interests they supposedly represent?
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Post by londonranger on May 1, 2012 15:13:25 GMT
There is a financial peril about every club, except those owned by the plutocrats at top of premiership. Liverpoolis under a challenge, but they will survive it.
Why in the world Briatore got involved could have only been explained that it would help his other businesses PR and give him more business exposure. While helping out someone he owed a favour to.
Only the guile of Ecclestone ensured they would make a small profit by getting out before they had to spend real money.
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Post by Macmoish on May 1, 2012 15:19:37 GMT
They got us up...But it seems to me, they laid down no roots whatsoever...And that if the only goal had been to bump us into the Premiership. They wasted untold millions (or even tens of millions) doing so.
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Post by londonranger on May 1, 2012 15:44:22 GMT
Agree heartily.
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Post by Macmoish on May 1, 2013 7:20:09 GMT
Bump a year...I know Parachute Money has gone up...and some other stuff... Anything else different...
And do we have two years to do this by overspending without fine?
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Post by Macmoish on May 1, 2013 8:58:59 GMT
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Post by Macmoish on Dec 3, 2013 10:52:13 GMT
Bump
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Post by Jon Doeman on Dec 3, 2013 12:37:56 GMT
This new signing (if it happens), would suggest they're more worried about not getting promoted than this FFP FFS !
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Post by Macmoish on Dec 3, 2013 13:19:35 GMT
Perhaps because we are SOOOOO Screwed financially.
But perish the thought they'd be honest and open with the fans!
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