| How did we go from having 0 debt to 21m of debt? 05:25 - Jan 2 with 5223 views | MyFinalHeaven |
I just had a look at our annual financial reports from 2012-2015 and it shows that we went from having 0 debt from 2012-2014 to suddenly having £21m of debt in 2015. What the hell suddenly caused this influx of debt???
Every year The Guardian publishes an annual breakdown of the Premier League clubs' finances, with all of its information derived from the annual reports published by the clubs at Companies House. This is how we looked year by year from 2012-2015:
- Accounts for the year to 31 May 2012
Profit before tax: £17m (after £11m loss in 2011)
Net debt: Nil; £5m cash in the bank
Interest payable: £0.3m
Highest-paid director: Huw Jenkins, £200,000
https://www.theguardian.com/football/2013/apr/18/premier-league-finances-club-by
- Accounts for the year to 31 May 2013
Profit before tax: £21m (up from £17m in 2012)
Net debt: Nil; £4m cash in the bank
Interest payable: £0.05m
Highest paid director: Huw Jenkins, £250,000
https://www.theguardian.com/football/2014/may/01/premier-league-accounts-club-by
- Accounts for the year to 31 May 2014
Profit before tax £1m (down from £21m in 2013)
Net debt Nil; £2m cash in the bank
Interest payable £0.015m
Highest-paid director Huw Jenkins, £550,000
https://www.theguardian.com/football/2015/apr/29/premier-league-finances-club-by
- Accounts of Swansea City Football 2002 Ltd for 14 months to 31 July 2015 (club changed its financial year end to 31 July, so all figures are for 14 months from 31 May 2014)
- Profit before tax £2m, following £1m profit in 2014
- Net debt £21m
- Interest payable £0.2m
- Highest-paid director Huw Jenkins, £516,667
https://www.theguardian.com/football/2016/may/25/premier-league-finances-club-by
What in the world happened? We went from having 0 debt and cash in the bank to all of a sudden having £21m in debt. Anyone have an explanation for this?
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| How did we go from having 0 debt to 21m of debt? on 06:34 - Jan 2 with 3571 views | Shonky |
Spooky. Almost a carbon copy of the thread from last year. |  |
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| How did we go from having 0 debt to 21m of debt? on 07:02 - Jan 2 with 3532 views | thereisnospoon |
in 1 year did Jenkins really increase his salary from £250,000 to £550,000
wow |  | | |
| How did we go from having 0 debt to 21m of debt? on 07:09 - Jan 2 with 3504 views | barry_island |
| How did we go from having 0 debt to 21m of debt? on 07:02 - Jan 2 by thereisnospoon |
in 1 year did Jenkins really increase his salary from £250,000 to £550,000
wow |
Presumably this is without dividend payments?
How was the increase justified to other Board members, including the Trust? | |
| Swansea City, THE Austerity Club. |
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| How did we go from having 0 debt to 21m of debt? on 07:13 - Jan 2 with 3500 views | OptimisticJack |
| How did we go from having 0 debt to 21m of debt? on 07:02 - Jan 2 by thereisnospoon |
in 1 year did Jenkins really increase his salary from £250,000 to £550,000
wow |
Not only Jenkins. Every board member was given a 100% pay rise. Put that into perspective Gwilym Joseph an elderly gentleman over 80 years age went from around 50k a year to around 100k !!
I've got nothing against Mr Joseph by the way. He has worked hard for the club in the past (particularly with regards to our move to the Liberty stadium).
Total financial mismanagement agreeing pay increases to this extent.
Too many heads in the trough. [Post edited 2 Jan 2017 7:33]
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| How did we go from having 0 debt to 21m of debt? on 07:16 - Jan 2 with 3491 views | barry_island |
What about Millie? | |
| Swansea City, THE Austerity Club. |
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| How did we go from having 0 debt to 21m of debt? on 07:42 - Jan 2 with 3412 views | somersetsimon |
I know accounting isn't as simple as it looks, but can someone explain in simple terms how we ended 2012 with £5M cash in the bank, made £21M profit in the following year, but then end up with £4m cash in the bank? |  | | |
| How did we go from having 0 debt to 21m of debt? on 07:49 - Jan 2 with 3393 views | Highjack |
| How did we go from having 0 debt to 21m of debt? on 07:42 - Jan 2 by somersetsimon |
I know accounting isn't as simple as it looks, but can someone explain in simple terms how we ended 2012 with £5M cash in the bank, made £21M profit in the following year, but then end up with £4m cash in the bank? |
Presumably the bank got robbed at some point. |  |
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| How did we go from having 0 debt to 21m of debt? on 08:10 - Jan 2 with 3332 views | Shonky |
Lisa will be along any minute to explain the concept of assets. ( again) | |
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| How did we go from having 0 debt to 21m of debt? on 08:16 - Jan 2 with 3301 views | waynekerr55 |
Wages mainly.
Add to that Huw's clusterfùck in recent years this is not surprising |  |
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| How did we go from having 0 debt to 21m of debt? on 08:20 - Jan 2 with 3273 views | somersetsimon |
| How did we go from having 0 debt to 21m of debt? on 08:10 - Jan 2 by Shonky |
Lisa will be along any minute to explain the concept of assets. ( again) |
You mean if we pay £20m cash for an asset today, but write it off over 5 years, that would show up as a £4m drop in profits over each of the next 5 years, but a £20m drop in actual cash in this financial year?
Can clubs only do this with assets like training facilities? | | | |
| How did we go from having 0 debt to 21m of debt? on 09:07 - Jan 2 with 3092 views | thereisnospoon |
| How did we go from having 0 debt to 21m of debt? on 08:16 - Jan 2 by waynekerr55 |
Wages mainly.
Add to that Huw's clusterfùck in recent years this is not surprising |
we went from having 0 debt to £21m debt in 1 year because of wages?
how is that possible? it's not like in that period of time we signed 10 players and put them on big wages | | | |
| How did we go from having 0 debt to 21m of debt? on 09:15 - Jan 2 with 3042 views | Kilkennyjack |
Thanks for taking the time to pull all this together.
I have no idea.
Is there some advantage to the then pending sale to show such a sudden loss ?
I have no idea.
As regards salary increases - then anything like 100 per cent is , frankly, unheard of. A 'laugh out loud' level of increase. |  |
| Beware of the Risen People
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| How did we go from having 0 debt to 21m of debt? on 09:41 - Jan 2 with 2932 views | jerseyexileswan |
I remember a news paper article about something similar to this a few years ago.
It might have been Liverpool under the previous owners and they had a debt of about 80m.
I think Torres was the example given and he was valued for accounting purposes at 8m basically because he was bought for 20m on a 5 year contract and he had 2 years left. In reality he went for 50 million not long after.
This might be slightly wrong but basically Gylfi is probably worth a lot more than the accounts will show. | | | |
| How did we go from having 0 debt to 21m of debt? on 10:19 - Jan 2 with 2746 views | Joe_bradshaw |
I'm not an accountant but I think players are considered to be intangible fixed assets on the balance sheet amortised over the length of the contract because the players are worthless at the end of their contracts. |  |
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| How did we go from having 0 debt to 21m of debt? on 10:28 - Jan 2 with 2704 views | PURe_Evil |
£550,000 a year, f*cking shocking. |  | | |
| How did we go from having 0 debt to 21m of debt? on 10:42 - Jan 2 with 2651 views | harryhpalmer |
| How did we go from having 0 debt to 21m of debt? on 10:28 - Jan 2 by PURe_Evil |
£550,000 a year, f*cking shocking. |
As a paying Trust member, I would like to know if the Trust approved these huge salary hikes, and if so, what the justification was.
As for the increase in debt, was this the season where they changed the accounting period from 12 to 18 months to move to a season timeline, which we weren't previously? And this would result on an extra period of time where we were paying wages and transfer fees but no TV income coming in? | |
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| How did we go from having 0 debt to 21m of debt? on 10:45 - Jan 2 with 2622 views | hammy |
| How did we go from having 0 debt to 21m of debt? on 09:07 - Jan 2 by thereisnospoon |
we went from having 0 debt to £21m debt in 1 year because of wages?
how is that possible? it's not like in that period of time we signed 10 players and put them on big wages |
The wages and other operating costs would be taken into account when calculating the profit for the financial year, so the debt indicated must be some form of borrowing (e.g., a bank loan) or similar.
Also cash in bank and profits never align due to accruals / deferrals (e.g., the fee paid for a player bought for £10M might be spread over 4 years due to his contract period) . I'm not an accountant but have had to learn to work with them over the past several years !
Also debt is not a bad thing if you can easily afford to make the repayments. It depends why you are borrowing money. I take it most people on the bored have a mortgage for example. |  |
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| How did we go from having 0 debt to 21m of debt? on 10:48 - Jan 2 with 2600 views | GeoffThom |
Do these take into account last transfers sales if not there nothing to see here as we made more than we spent ,didn't we? |  | | |
| How did we go from having 0 debt to 21m of debt? on 10:55 - Jan 2 with 2557 views | PURe_Evil |
Around 4 times the wage of the Prime Minister, Huw Jenkins the fountain of footballing knowledge. | | | |
| How did we go from having 0 debt to 21m of debt? on 10:59 - Jan 2 with 2533 views | max936 |
| How did we go from having 0 debt to 21m of debt? on 07:13 - Jan 2 by OptimisticJack |
Not only Jenkins. Every board member was given a 100% pay rise. Put that into perspective Gwilym Joseph an elderly gentleman over 80 years age went from around 50k a year to around 100k !!
I've got nothing against Mr Joseph by the way. He has worked hard for the club in the past (particularly with regards to our move to the Liberty stadium).
Total financial mismanagement agreeing pay increases to this extent.
Too many heads in the trough. [Post edited 2 Jan 2017 7:33]
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How can the club justify those wage increases to the directors in what other business would that happen? |  |
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| How did we go from having 0 debt to 21m of debt? on 11:25 - Jan 2 with 2452 views | JJJack |
Seriously though, can anyone explain where this debt suddenly appeared from? The accounting period only increased by 2mths. And , yes, debt isn't necessarily a problem if you can repay. But £21m is a helluva whack all of a sudden. Is it purely down to a change in the way players were "valued" for accounting purposes? Or is there another reason? |  | | |
| How did we go from having 0 debt to 21m of debt? on 11:49 - Jan 2 with 2392 views | thereisnospoon |
| How did we go from having 0 debt to 21m of debt? on 11:25 - Jan 2 by JJJack |
Seriously though, can anyone explain where this debt suddenly appeared from? The accounting period only increased by 2mths. And , yes, debt isn't necessarily a problem if you can repay. But £21m is a helluva whack all of a sudden. Is it purely down to a change in the way players were "valued" for accounting purposes? Or is there another reason? |
this x100. i'd really like to know how we got so much debt and in such a short amount of time. anyone in the trust like to give an explanation? phil? andrew? [Post edited 2 Jan 2017 12:28]
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| How did we go from having 0 debt to 21m of debt? on 11:51 - Jan 2 with 2378 views | longlostjack |
What about the management accounts ? Surely as a major shareholder the Trust would have access to those on a monthly basis? [Post edited 2 Jan 2017 12:00]
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| How did we go from having 0 debt to 21m of debt? on 11:58 - Jan 2 with 2349 views | max936 |
| How did we go from having 0 debt to 21m of debt? on 11:49 - Jan 2 by thereisnospoon |
this x100. i'd really like to know how we got so much debt and in such a short amount of time. anyone in the trust like to give an explanation? phil? andrew? [Post edited 2 Jan 2017 12:28]
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Monies could have been cleverly ferreted away, although if you look at the costing for the training facilities, materials can easily be over ordered then disappear to other jobs, labour costs etc, I did hear rumours of Jaxx Bay not having the personnel to carry out a lot of the jobs and had to go cap in hand to other employers for the relevant trades to do jobs, they were running around looking for carpenters to hang doors, if that's got any truth in it, then those other trades could charge what they like if Jaxx were that desperate. | |
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