| Audited Accounts are now out 12:04 - Mar 13 with 28573 views | Shaky |
For club: https://beta.companieshouse.gov.uk/company/00123414/filing-history
For holding company: https://beta.companieshouse.gov.uk/company/04305508/filing-history
Will try to find time to crunch the numbers later, but quick glimpse shows the huge increase in operating costs is all substantially down to staff costs.
As I said previously, it is hard to imagine how even the lions share can be attibutable to the playing staff given the departures.
What is certain is the for example Peralman' s salary is lumped in there, and potentally also some kind of remuneration for the US property developer on the board of the parent company. How much is attributable to this remains unclear, however.
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| Audited Accounts are now out on 12:26 - Mar 15 with 1896 views | LeonWasGod |
| Audited Accounts are now out on 11:44 - Mar 15 by londonlisa2001 |
Shaky, I know what a balance sheet is mun, I'm an accountant!
You are missing my point.
Player purchases, new contracts, sales etc are within the remit of the club. They can turn them on or off depending on league position. They can only do this largely (as contracts can be done as and when), during the transfer windows. The largest window overlaps the balance sheet date and runs on for a few weeks, but information on that is seen as a post balance sheet event in the accounts which were signed on 31 October, and, therefore, gives the information for the rest of that window. It doesn't get muddied by the January window as those movements would not be included due to the signing date.
So, if we assume for a moment that we had been relegated last season. The purchases of players prior to the balance sheet date would not have happened (as you say, Mesa was the big one, from memory I think we brought in Tammy prior to the end of July as well and there may have been others, I can't remember). The sales that happened (including those after the balance sheet date) would have gone ahead, and we wouldn't have bought or loaned players in August (Clucas, Sanches, again I can't remember who joined and when off the top of my head).
So the working capital (if we'd gone down), would have seen the inflow of the £46m shown as post balance sheet, but would not have seen the outflows of £28m mentioned, and also would not have seen outflows for Mesa / Abraham that are included in the balance sheet (as a mixture of cash out and creditors).
So at least a £40m 'improvement' in working capital. Obviously with a corresponding decrease in the assets we have and in the quality of playing staff.
What you are saying, is that any further funds needed would have had to come from other player sales. Well no sh*t Sherlock. That's what relegation does. It means you have to sell some players.
For a club like us, selling players at a profit is part of how we finance ourselves. You can't dismiss it. It's the same for most smaller clubs.
The book value of players being £70m isn't particularly relevant. The problem with football club accounts is that they don't mark players to market and yet they do take impairment adjustments. It's because players are treated as intangibles. Included in that figure, for example, will be maybe £4m or so for Mawson (we bought him at £5m ish and there will have been some depreciation over life of contract in these accounts). And yet, Mawson's value is, say £25m, maybe more. Same with Jordan Ayew (in these accounts at whatever we paid, was it £7m or so, some of which was financed by Taylor, less depreciation to give, say £5m) and worth probably £15m -£20m.
As I said previously, in my first response, cashflow is very tight and has to be very tightly monitored and controlled, but the analysis you've presented is not accurate in terms of 'holes that need to be financed'.
On the Trust's stake bit, legal action or otherwise is not intended as a compensation for value loss in after the deal events. I believe that legal action should have been taken and should be taken. I made that clear at the time and I continue to do so. I believe that as I believe that the Trust was unfairly prejudiced by the sale. Nothing in a set of accounts will alter that view, whether good, bad or indifferent. The Trust is not in the business of investing to make a return. It's in the business of protecting the long term interest of the football club. My view is that it can only do that in one of two ways. Either a genuine influence and voice in the running of the club, or if that can't be achieved, maximising the money available to step in at a future date. [Post edited 15 Mar 2018 11:51]
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If I'd have known you were an accountant I wouldn't have believed a word you've said in any previous threads. All smoke and mirrors innit. You lot are worse than politicians 
Thanks for the analysis and I'm enjoying this exchange with Shaky. So basically we're a little bit fecked on cashflow, we won't be signing Bale on his return but rather more £5m Huwbert specials as long as we sell first, and we'll be really fecked if we go down. Both in terms of operating capital and potential liabilities for higher ground costs than we might have had. Is that about right?
Given the owners have shown no sign of levering additional funds from anywhere (and we don't have surplus) I suppose we can say goodbye to any future ground expansion too. |  | | |
| Audited Accounts are now out on 12:28 - Mar 15 with 1892 views | Shaky |
. .and yes, Lisa, when clubs go down they sell players.
But the expectations from fans generally is they won't go bust in the process. I very much doubt that is the case here. | |
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| Audited Accounts are now out on 12:30 - Mar 15 with 1891 views | londonlisa2001 |
For an understanding of what I'm on about with players and the effect on a balance sheet, by the way, here's a quick, simple example of the issue:
Take one player, say Mawson. Assume we buy him for £5m plus £1m costs on a salary of £2m a year, with a 4 year contract and look at the effect on our accounts in one year.
Before Mawson:
Fixed assets - £0
Working Capital - £0
P&L - £0
Buy him:
Fixed assets - increased by £6m
Working Capital - decreased by £6m (cash or creditor)
P&L - no effect
Pay him:
Fixed assets - no effect
Working Capital - decreased by £2m (cash)
P&L - £2m cost is recognised
Depreciate him:
Fixed Assets - decreased by £1.5m, being a quarter of the total
Working Capital - no effect as it's only an accounting entry
P&L - £1.5m cost is recognised
So in the accounts we start off with:
Fixed Assets - £0
Working Capital - £0
P&L - £0
And end with:
Fixed Assets - £4.5m
Working Capital - ( £8m)
Loss in P&L - (£3.5m)
It looks crap. Our balance sheet is £3.5m 'worse' than it was, and we are showing a £3.5m loss in the profit and loss account and we have what Shaky has described as a £8m hole in our working capital.
But what that doesn't show, is that Mawson has, over the course of that year, risen in value to £25m. You can't show that in the accounts because of accounting rules. You'll only ever see that true 'profit' if we ever sell him.
So saying that the balance sheet is weak and we are too reliant on player sales is silly given the way the accounting works.
What is actually important at any given time, is how much players are worth compared to what we owe and have in cash available.
Sorry if that's boring, it's just that people don't necessarily understand the way that the accounting works. |  | | |
| Audited Accounts are now out on 12:39 - Mar 15 with 1860 views | londonlisa2001 |
| Audited Accounts are now out on 12:11 - Mar 15 by Shaky |
Your argument effectively boils down to this, Lisa; before the start of the season, the club could have sold Siggy and Llorente, not replaced them with anybody and everything would have been great!
And do you really think if Swansea had bene relegated they would have got anywere near the prices obtained for those two?
What is true, however, is that the sale of Siggy in particular was a get out of jail card for the club, that will significantly help profits this year.
It was a one off, but it certainly repaired the extreme undercapitalisation issue and generally put a big plaster on the worst shortcomings of the balance sheet.
Or rather it could have done, if the DofMeister hadn't taken the proceeds from that sale + Llorente's, added a little extra on top and splashed out £70 million on:
Mesa (£12m)
Bony (£13m)
Clucas (£16m)
Sanches (£7m loan fee)
Ayew (£22m)
What's that lot worth, firesale or not? |
Shaky, I've already said that it's the value of players that's important. I've also said we can't afford mistakes in the market nor can we afford to have several changes of management in a year as the costs of that hit us.
I don't know what you're trying to prove here? | | | |
| Audited Accounts are now out on 13:52 - Mar 15 with 1796 views | TheResurrection |
| Audited Accounts are now out on 12:30 - Mar 15 by londonlisa2001 |
For an understanding of what I'm on about with players and the effect on a balance sheet, by the way, here's a quick, simple example of the issue:
Take one player, say Mawson. Assume we buy him for £5m plus £1m costs on a salary of £2m a year, with a 4 year contract and look at the effect on our accounts in one year.
Before Mawson:
Fixed assets - £0
Working Capital - £0
P&L - £0
Buy him:
Fixed assets - increased by £6m
Working Capital - decreased by £6m (cash or creditor)
P&L - no effect
Pay him:
Fixed assets - no effect
Working Capital - decreased by £2m (cash)
P&L - £2m cost is recognised
Depreciate him:
Fixed Assets - decreased by £1.5m, being a quarter of the total
Working Capital - no effect as it's only an accounting entry
P&L - £1.5m cost is recognised
So in the accounts we start off with:
Fixed Assets - £0
Working Capital - £0
P&L - £0
And end with:
Fixed Assets - £4.5m
Working Capital - ( £8m)
Loss in P&L - (£3.5m)
It looks crap. Our balance sheet is £3.5m 'worse' than it was, and we are showing a £3.5m loss in the profit and loss account and we have what Shaky has described as a £8m hole in our working capital.
But what that doesn't show, is that Mawson has, over the course of that year, risen in value to £25m. You can't show that in the accounts because of accounting rules. You'll only ever see that true 'profit' if we ever sell him.
So saying that the balance sheet is weak and we are too reliant on player sales is silly given the way the accounting works.
What is actually important at any given time, is how much players are worth compared to what we owe and have in cash available.
Sorry if that's boring, it's just that people don't necessarily understand the way that the accounting works. |
This is where Lisa brought out the blackboard and chalk 😂😂😂 |  |
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| Audited Accounts are now out on 14:46 - Mar 15 with 1761 views | QJumpingJack |
With most transfers, they are staggered over 2/3/4 years - would this impact the overall numbers? | | | |
| Audited Accounts are now out on 15:02 - Mar 15 with 1739 views | airedale |
| Audited Accounts are now out on 14:46 - Mar 15 by QJumpingJack |
With most transfers, they are staggered over 2/3/4 years - would this impact the overall numbers? |
Thassa good one QJJ. From memory, when you set up your VAT registration they ask you which way you want to play it, either on your invoiced totals or on actual cash trousered. Maybe football clubs are offered something similar? |  | | |
| Audited Accounts are now out on 15:05 - Mar 15 with 1737 views | Shaky |
| Audited Accounts are now out on 12:30 - Mar 15 by londonlisa2001 |
For an understanding of what I'm on about with players and the effect on a balance sheet, by the way, here's a quick, simple example of the issue:
Take one player, say Mawson. Assume we buy him for £5m plus £1m costs on a salary of £2m a year, with a 4 year contract and look at the effect on our accounts in one year.
Before Mawson:
Fixed assets - £0
Working Capital - £0
P&L - £0
Buy him:
Fixed assets - increased by £6m
Working Capital - decreased by £6m (cash or creditor)
P&L - no effect
Pay him:
Fixed assets - no effect
Working Capital - decreased by £2m (cash)
P&L - £2m cost is recognised
Depreciate him:
Fixed Assets - decreased by £1.5m, being a quarter of the total
Working Capital - no effect as it's only an accounting entry
P&L - £1.5m cost is recognised
So in the accounts we start off with:
Fixed Assets - £0
Working Capital - £0
P&L - £0
And end with:
Fixed Assets - £4.5m
Working Capital - ( £8m)
Loss in P&L - (£3.5m)
It looks crap. Our balance sheet is £3.5m 'worse' than it was, and we are showing a £3.5m loss in the profit and loss account and we have what Shaky has described as a £8m hole in our working capital.
But what that doesn't show, is that Mawson has, over the course of that year, risen in value to £25m. You can't show that in the accounts because of accounting rules. You'll only ever see that true 'profit' if we ever sell him.
So saying that the balance sheet is weak and we are too reliant on player sales is silly given the way the accounting works.
What is actually important at any given time, is how much players are worth compared to what we owe and have in cash available.
Sorry if that's boring, it's just that people don't necessarily understand the way that the accounting works. |
As I said earlier, Lisa, you don't understand working capital.
There are several definitions of this, but the one that is used in finance seeks to seperate assets and liabilities used in the actual operations, from those that are used to finance it. This is strategy consulting 101 (Bain originated this)
As such the definition of working capital used in finance specifically excludes cash, bank debt, etc: ~current operating assets Less ~current operating debt.
The interaction of that in combination with the other component of capital employed LT (fixed/intangible) assets then gives you aresult in cash/generated consumed by the actual operations.
That then goes into the financing need which is analysed seperately and in isolation.
And the problem here is that you bring a primer on basic bookkeeping double entry to that discussion of financing. | |
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| Audited Accounts are now out on 16:15 - Mar 15 with 1689 views | Legend83 |
| Audited Accounts are now out on 12:30 - Mar 15 by londonlisa2001 |
For an understanding of what I'm on about with players and the effect on a balance sheet, by the way, here's a quick, simple example of the issue:
Take one player, say Mawson. Assume we buy him for £5m plus £1m costs on a salary of £2m a year, with a 4 year contract and look at the effect on our accounts in one year.
Before Mawson:
Fixed assets - £0
Working Capital - £0
P&L - £0
Buy him:
Fixed assets - increased by £6m
Working Capital - decreased by £6m (cash or creditor)
P&L - no effect
Pay him:
Fixed assets - no effect
Working Capital - decreased by £2m (cash)
P&L - £2m cost is recognised
Depreciate him:
Fixed Assets - decreased by £1.5m, being a quarter of the total
Working Capital - no effect as it's only an accounting entry
P&L - £1.5m cost is recognised
So in the accounts we start off with:
Fixed Assets - £0
Working Capital - £0
P&L - £0
And end with:
Fixed Assets - £4.5m
Working Capital - ( £8m)
Loss in P&L - (£3.5m)
It looks crap. Our balance sheet is £3.5m 'worse' than it was, and we are showing a £3.5m loss in the profit and loss account and we have what Shaky has described as a £8m hole in our working capital.
But what that doesn't show, is that Mawson has, over the course of that year, risen in value to £25m. You can't show that in the accounts because of accounting rules. You'll only ever see that true 'profit' if we ever sell him.
So saying that the balance sheet is weak and we are too reliant on player sales is silly given the way the accounting works.
What is actually important at any given time, is how much players are worth compared to what we owe and have in cash available.
Sorry if that's boring, it's just that people don't necessarily understand the way that the accounting works. |
Not sure your interpretation of "working capital" is quite correct here.
If you pay for the player immediately, then you reduce your cash and cash equivalents (i.e. your net debt position goes up), not your working capital.
Any creditor in relation to the player purchase (i.e. where you don't pay immediately) is not likely to be a "Trade Payable", more likely a longer-term borrowing? | | | |
| Audited Accounts are now out on 17:10 - Mar 15 with 1649 views | londonlisa2001 |
| Audited Accounts are now out on 15:05 - Mar 15 by Shaky |
As I said earlier, Lisa, you don't understand working capital.
There are several definitions of this, but the one that is used in finance seeks to seperate assets and liabilities used in the actual operations, from those that are used to finance it. This is strategy consulting 101 (Bain originated this)
As such the definition of working capital used in finance specifically excludes cash, bank debt, etc: ~current operating assets Less ~current operating debt.
The interaction of that in combination with the other component of capital employed LT (fixed/intangible) assets then gives you aresult in cash/generated consumed by the actual operations.
That then goes into the financing need which is analysed seperately and in isolation.
And the problem here is that you bring a primer on basic bookkeeping double entry to that discussion of financing. |
Shaky - I showed the bookkeeping entries because you are taking your figures from a set of bloody accounts that uses those entries.
As for the rest - I have tried not to be rude, but you obviously have no idea how to read a set of accounts.
What's actually happened here is you missed the deferred income element when doing your calculation and since I've pointed it out, you've been trying to bullsh*t.
I really don't give a toss how you want to define anything. We are talking about a set of financial statements of a football club, and working capital is current assets less current liabilities.
I'm not bothering to explain any further as it's boring for everyone else. | | | |
| Audited Accounts are now out on 17:16 - Mar 15 with 1638 views | felixstowe_jack |
Strange if you get two accountants together they can get four sets of books 8 sets of figures.
No wonder the EU can never get their accounts accepted by their auditors.
A bit like BHS, ToyRus, Msaplins, Carrillion. | |
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| Audited Accounts are now out on 17:20 - Mar 15 with 1634 views | londonlisa2001 |
| Audited Accounts are now out on 16:15 - Mar 15 by Legend83 |
Not sure your interpretation of "working capital" is quite correct here.
If you pay for the player immediately, then you reduce your cash and cash equivalents (i.e. your net debt position goes up), not your working capital.
Any creditor in relation to the player purchase (i.e. where you don't pay immediately) is not likely to be a "Trade Payable", more likely a longer-term borrowing? |
Working Capital is current assets less current liabilities.
You may find that if we finance players over a long term, some of the impact on working capital is lessened as it would be shown as a creditor due in more than 1 year, but in this case, the total long term liabilities (that aren't the mentioned loan) are only £5m whereas current liabilities are considerably higher, so I ignored it for the purposes of the example as it's not relevant.
There is also, by the way, c. £8m in the debtors figure that is due in more than one year.
The actual bit of the accounts that people should take note of and yet Shaky didn't mention as he doesn't seem to know how to read accounts, is that there is c £11m liability due to other clubs if certain add on triggers are met in transfers in, and also c. £11m in potential signing bonuses to players that will need to be paid if they are with us when those trigger. Neither is included in the balance sheet as a creditor. Similarly, there will be amounts that we will receive on certain triggers that are not included as debtors. So some risk is off balance sheet. Potentially quite large.
We don't know what they are, and neither do we know what triggers are present. | | | |
| Audited Accounts are now out on 17:22 - Mar 15 with 1629 views | Shaky |
| Audited Accounts are now out on 17:10 - Mar 15 by londonlisa2001 |
Shaky - I showed the bookkeeping entries because you are taking your figures from a set of bloody accounts that uses those entries.
As for the rest - I have tried not to be rude, but you obviously have no idea how to read a set of accounts.
What's actually happened here is you missed the deferred income element when doing your calculation and since I've pointed it out, you've been trying to bullsh*t.
I really don't give a toss how you want to define anything. We are talking about a set of financial statements of a football club, and working capital is current assets less current liabilities.
I'm not bothering to explain any further as it's boring for everyone else. |
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| Audited Accounts are now out on 17:23 - Mar 15 with 1629 views | londonlisa2001 |
| Audited Accounts are now out on 17:16 - Mar 15 by felixstowe_jack |
Strange if you get two accountants together they can get four sets of books 8 sets of figures.
No wonder the EU can never get their accounts accepted by their auditors.
A bit like BHS, ToyRus, Msaplins, Carrillion. |
Shaky is not an accountant. | | | |
| Audited Accounts are now out on 17:33 - Mar 15 with 1600 views | londonlisa2001 |
| Audited Accounts are now out on 17:22 - Mar 15 by Shaky |
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I know how you got to your number without this nonsense. That's why I was able to point out you'd included the deferred income which the above shows.
You then said we'd need to finance it. Which we don't. Because it's deferred income. Which you didn't think about. | | | |
| Audited Accounts are now out on 17:38 - Mar 15 with 1588 views | Shaky |
| Audited Accounts are now out on 17:33 - Mar 15 by londonlisa2001 |
I know how you got to your number without this nonsense. That's why I was able to point out you'd included the deferred income which the above shows.
You then said we'd need to finance it. Which we don't. Because it's deferred income. Which you didn't think about. |
No.
I said it is pre-financing from the Premier League. A souce of cash. That is in effect owed to the business. That is the whole point!
This is one of the subtleties of negative working capital that is not immediately apparent. Even to those who understand how it is used and analysed in finance. [Post edited 15 Mar 2018 17:38]
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| Audited Accounts are now out on 17:39 - Mar 15 with 1586 views | Darran |
| Audited Accounts are now out on 17:23 - Mar 15 by londonlisa2001 |
Shaky is not an accountant. |
He’s got books and things. |  |
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| Audited Accounts are now out on 17:46 - Mar 15 with 1570 views | londonlisa2001 |
| Audited Accounts are now out on 17:38 - Mar 15 by Shaky |
No.
I said it is pre-financing from the Premier League. A souce of cash. That is in effect owed to the business. That is the whole point!
This is one of the subtleties of negative working capital that is not immediately apparent. Even to those who understand how it is used and analysed in finance. [Post edited 15 Mar 2018 17:38]
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Nah Shaky - read the thread. You said that after I'd pointed it out to you.
You then wanted a theoretical discussion on what would've happened if we hadn't received it because we were relegated. When I then pointed out that the other figures would have also been different because the transfers out and in would have changed, so you can't do a 'what if' without doing both sides when you'd only done one. In either scenario, we would not have ended up with a £66m hole that required financing. We would have just had fewer players (or different ones), which, as I said, is what happens when clubs are relegated. | | | |
| Audited Accounts are now out on 17:57 - Mar 15 with 1550 views | Shaky |
| Audited Accounts are now out on 17:39 - Mar 15 by Darran |
He’s got books and things. |
Goddamn right! | |
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| Audited Accounts are now out on 17:59 - Mar 15 with 1543 views | Shaky |
| Audited Accounts are now out on 17:20 - Mar 15 by londonlisa2001 |
Working Capital is current assets less current liabilities.
You may find that if we finance players over a long term, some of the impact on working capital is lessened as it would be shown as a creditor due in more than 1 year, but in this case, the total long term liabilities (that aren't the mentioned loan) are only £5m whereas current liabilities are considerably higher, so I ignored it for the purposes of the example as it's not relevant.
There is also, by the way, c. £8m in the debtors figure that is due in more than one year.
The actual bit of the accounts that people should take note of and yet Shaky didn't mention as he doesn't seem to know how to read accounts, is that there is c £11m liability due to other clubs if certain add on triggers are met in transfers in, and also c. £11m in potential signing bonuses to players that will need to be paid if they are with us when those trigger. Neither is included in the balance sheet as a creditor. Similarly, there will be amounts that we will receive on certain triggers that are not included as debtors. So some risk is off balance sheet. Potentially quite large.
We don't know what they are, and neither do we know what triggers are present. |
Sauce:
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| Audited Accounts are now out on 18:04 - Mar 15 with 1533 views | Shaky |
| Audited Accounts are now out on 17:46 - Mar 15 by londonlisa2001 |
Nah Shaky - read the thread. You said that after I'd pointed it out to you.
You then wanted a theoretical discussion on what would've happened if we hadn't received it because we were relegated. When I then pointed out that the other figures would have also been different because the transfers out and in would have changed, so you can't do a 'what if' without doing both sides when you'd only done one. In either scenario, we would not have ended up with a £66m hole that required financing. We would have just had fewer players (or different ones), which, as I said, is what happens when clubs are relegated. |
LisaL
The prepayment takes the form of cash.
IF it had not been received - due to relegation - **negative** Net Workling Capital would have been £45 million lower (a smaller negative). Or however much it was.
But so would would cash, which would have swung into a whopping overdraft by the same amount: £45m. | |
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| Audited Accounts are now out on 18:06 - Mar 15 with 1526 views | Darran |
She’s ripped you a new one again Skakes. | |
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| Audited Accounts are now out on 18:38 - Mar 15 with 1484 views | magicdaps10 |
All I can say after reading all this is....no wonder the country is in a state.
Far too many people thinking they are better than they are.
At least I know what I am  |  |
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| Audited Accounts are now out on 18:47 - Mar 15 with 1460 views | londonlisa2001 |
| Audited Accounts are now out on 18:04 - Mar 15 by Shaky |
LisaL
The prepayment takes the form of cash.
IF it had not been received - due to relegation - **negative** Net Workling Capital would have been £45 million lower (a smaller negative). Or however much it was.
But so would would cash, which would have swung into a whopping overdraft by the same amount: £45m. |
I know.
But we would have made the sales we did and not the purchases as we would have known we were relegated when the window opened so we would have bridged the gap that way.
FFS, we've already been through this. | | | |
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