financial accounts to be released tomorrow

[LeeCookFan]

Expect a whole lot of negative press.

Wonder what sort of losses we are going to declare tomorrow?

And how much the FL will initially attempt to fine us?

And how long the saga will last after we make several appeals?

[West Acton]

And finance director has left and joined spurs

[QPRDave]

Press will be telling the world we are the anti-christ of football......Same ol posters here and other sites will start screaming loudly that we're doomed ........nuvver day at the office..

[Brian Wilson]

We can call it "Kirills Day"

[Kevin Mcleod]

And finance director has left and joined spurs

Headhunted, so she must of been good. Gutter.

[twranger]

[QUOTE=West Acton;1361433]And finance director has left and joined spurs[/QUOT

you really do have your finger on the pulse of everything going on at QPR don't you.......blimey!

[dave58]

[QUOTE=LeeCookFan;1361417]Expect a whole lot of negative press.

Wonder what sort of losses we are going to declare tomorrow?

And how much the FL will initially attempt to fine us?

And how long the saga will last after we make several appeals?[/QUOTE

Wait for the clamber to have us fined,thrown out of the league, transfer embargo, and various other sanctions, but when will people realise that very little of this is a debt to a bank I believe around £10M the rest is money owed to the major shareholders I.e.T.F Ruben and the Mittal's, so relatively a small but but everyone will make a big deal of it,

[UpperP]

If clubs never spent big on the hope of staying up then it would be a massive struggle. We gave it a go and ended up with players on big contracts. Unfortunately they are not going to forfeit them and aren't going to leave unless they get a better offer. SWP for example isn't number 1 on any prem teams shopping list so we've been stuck with him. Therefore you get in debt and the cycle continues. The rich get richer...

[klonk]

i reckon we'll declare losses of about £50m.

everyone will make out that this is appalling, but anyone who understands how football financial statements work will have to admit that, while it's not exactly fantastic, it does show a marked improvement in the financial stewardship of the club (on the basis that we somehow managed to cut our overall loss whilst absorbing a massive decrease in income). no one will listen to this analysis though and instead people will shout that we are the definition of all that is wrong with modern day football etc.

football league will attempt to apply its rules so... expect something around about £39m as a start point. expect the same people who complain about the size of the loss to claim that this is letting us off lightly and for them to drown out the voices of anyone who points out that there was literally nothing we could have done to come in without a fine (apart from managing to get a fee of about £10m each for the likes of bosingwa, anton, cisse etc when everyone knew we were desperate to offload).

the saga will roll on and on... particularly if we manage to avoid relegation somehow.

[stanistheman]

i reckon we'll declare losses of about £50m.

everyone will make out that this is appalling, but anyone who understands how football financial statements work will have to admit that, while it's not exactly fantastic, it does show a marked improvement in the financial stewardship of the club (on the basis that we somehow managed to cut our overall loss whilst absorbing a massive decrease in income). no one will listen to this analysis though and instead people will shout that we are the definition of all that is wrong with modern day football etc.

football league will attempt to apply its rules so... expect something around about £39m as a start point. expect the same people who complain about the size of the loss to claim that this is letting us off lightly and for them to drown out the voices of anyone who points out that there was literally nothing we could have done to come in without a fine (apart from managing to get a fee of about £10m each for the likes of bosingwa, anton, cisse etc when everyone knew we were desperate to offload).

the saga will roll on and on... particularly if we manage to avoid relegation somehow.

I agree, but the FL want relegated clubs to release, sell or loan players on big wages and replace them with cheap unknowns or youth players and end up like Portsmouth & Wolves or how Wigan and Fulham are doing now.

[klonk]

I agree, but the FL want relegated clubs to release, sell or loan players on big wages and replace them with cheap unknowns or youth players and end up like Portsmouth & Wolves or how Wigan and Fulham are doing now.

...which is a hefty part of the problem - the football league don't really seem to understand how financial reports work.

when players are bought, the transfer fee is capitalised and spread across the length of his contract rather than expensed in the year of purchase. many people in football try to portray this as 'dodgy accounting', but actually the opposite would be true.

so if you buy a player for, say £8m on a 4-year contract and then get relegated, then the following occurs...

loan him out: the club saves on the cash outlay for (at least some of) the player's wages, but we still have a year's worth of the player's purchase fee as a cost in the books (in this example 25% of £8m, so £2m).

sell him: the club avoids the outlay on wages, but has to record the difference between the fee received and the remainin book value of the player (the purchase fee less anything that's already been charged to the accounts). in this example, the player's book value is still £6m (£8m purchase fee less £2m charge for the season in which the club gets relegated), if we can sell him for more, then anything over £6m is recorded as a profit. if we get £6m, then there's no impact on our profit. if we get less than £6m, then the shortfall is recorded as a loss (charge) in the accounts. usually, other clubs know that relegated teams are desperate to offload high earners, so will normally offer much less than the remaining book value, so selling often results in short-term increases in losses, not decreases.

cancel contract: basically, this is the same as selling for nothing. the club avoids the wages but has to cop for all of the remaining book value as a loss - in this example, a £6m charge to the accounts.

basically, ffp leaves all promoted clubs with a dilemma. 'do a burnley' use lots of players with little premier league experience and sign experienced free agents on short term deals (with the risk that they'll leave for nothing) and hope to be able to compete at the new level, or invest and hope that you can somehow stave off relegation.

[qblockoompah]

Great post Klonk

[stainrodisalegend]

...which is a hefty part of the problem - the football league don't really seem to understand how financial reports work.

when players are bought, the transfer fee is capitalised and spread across the length of his contract rather than expensed in the year of purchase. many people in football try to portray this as 'dodgy accounting', but actually the opposite would be true.

so if you buy a player for, say £8m on a 4-year contract and then get relegated, then the following occurs...

loan him out: the club saves on the cash outlay for (at least some of) the player's wages, but we still have a year's worth of the player's purchase fee as a cost in the books (in this example 25% of £8m, so £2m).

sell him: the club avoids the outlay on wages, but has to record the difference between the fee received and the remainin book value of the player (the purchase fee less anything that's already been charged to the accounts). in this example, the player's book value is still £6m (£8m purchase fee less £2m charge for the season in which the club gets relegated), if we can sell him for more, then anything over £6m is recorded as a profit. if we get £6m, then there's no impact on our profit. if we get less than £6m, then the shortfall is recorded as a loss (charge) in the accounts. usually, other clubs know that relegated teams are desperate to offload high earners, so will normally offer much less than the remaining book value, so selling often results in short-term increases in losses, not decreases.

cancel contract: basically, this is the same as selling for nothing. the club avoids the wages but has to cop for all of the remaining book value as a loss - in this example, a £6m charge to the accounts.

basically, ffp leaves all promoted clubs with a dilemma. 'do a burnley' use lots of players with little premier league experience and sign experienced free agents on short term deals (with the risk that they'll leave for nothing) and hope to be able to compete at the new level, or invest and hope that you can somehow stave off relegation.

I knew I didn't think Fair Play was fair but you have explained far better than I have ever heard before precisely why it is so unfair. Many thanks

[QPRWEBBIE]

I never bother reading them because all the press reports are boll*cks and the board all have there own interests in the club and are in it for the long haul otherwise they wouldn't of invested they would of just put it through a multitude of banks.