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The Dummies Guide to FFP


hippo
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OK once and for all lets get this nailed.

What I know (I think)

There are at least two flavours of FFP - The PL and EFL.

Whilst you can be deducted points - the first step is a transfer embargo. I don't think any club has been deducted points.

The Figure of £83m confuses me - is that for all clubs ? - or is that just Aston Villa based on a % of turnover.

 

....over to the experts.....

 

 

 

 

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Just now, hippo said:

OK once and for all lets get this nailed.

What I know (I think)

There are at least two flavours of FFP - The PL and EFL.

Whilst you can be deducted points - the first step is a transfer embargo. I don't think any club has been deducted points.

The Figure of £83m confuses me - is that for all clubs ? - or is that just Aston Villa based on a % of turnover.

 

....over to the experts.....

 

 

 

 

From what i get your only allowed to lose 80m over three seasons, after that your in big trouble. 

I think we will get that figure significantly down this year.But its vital we go up in next 2 seasons

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12 minutes ago, hippo said:

OK once and for all lets get this nailed.

What I know (I think)

There are at least two flavours of FFP - The PL and EFL.

Whilst you can be deducted points - the first step is a transfer embargo. I don't think any club has been deducted points.

The Figure of £83m confuses me - is that for all clubs ? - or is that just Aston Villa based on a % of turnover.

 

....over to the experts.....

 

 

 

 

Changes to FFP regulation (this season?) mean that the EFL can basically now punish a club however they see fit. Up until now, they had only used fines and transfer bans. Now, they could deduct points, chuck a team out the playoffs... whatever they fancy.

The £83m figure relates to relegated clubs who have stayed in the league for one season (Aston Villa and Norwich). This is because you can make losses of £35m for each PL season and £13m for each Championship season. FFP is applied over a rolling 3-year period so:

£35m + £35m + £13m = £83m.

If we remain in the Championship for another two seasons, that figure becomes £39m. 

Edited by bobzy
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20 minutes ago, bobzy said:

Changes to FFP regulation (this season?) mean that the EFL can basically now punish a club however they see fit. Up until now, they had only used fines and transfer bans. Now, they could deduct points, chuck a team out the playoffs... whatever they fancy.

The £83m figure relates to relegated clubs who have stayed in the league for one season (Aston Villa and Norwich). This is because you can make losses of £35m for each PL season and £13m for each Championship season. FFP is applied over a rolling 3-year period so:

£35m + £35m + £13m = £83m.

If we remain in the Championship for another two seasons, that figure becomes £39m. 

So by that (I have no reason not to believe you)

We have a max of

83mill till 01.06.2017 (exact date?) or the following year?

61mill till 01.06.2018 (?) ditto

&

39mill till 01.06.2019 (?) ditto

Does anyone know (or a good guess) of how much of that 83mill limit has been taken up?

That would leave us with a possible nett spend figure.

Either way, we need to get rid of some deadwood, the more the monier we are, as its obvious what we need (2x GK, Backup CB, LB if Amavi is sold, DM backup, 1x Cm backup and 1 ST).

I'm not too concerned about fpp because even if we dont spend big and only get a couple in, we should have enough in the squad to get 1st/2nd.

I'd be more interested in knowing

1) our FFP status in relationship to our max limit

2) who is going out and for how much

3) the knock on effect for next year if we dont get promoted.

with the parachute payments going down year for year till our 3rd year outside the PL its imperative we go up within the next 2 seasons.

My concern has always been that we saw what happened when FFP kicked RL's investment into touch. How would DrT react if FFP limited us so much that we couldnt get promoted in these next 2 years.

Would he sell up?

to who?

or

do a Randy and sit it out untill he is wiped out and firesale us to the next owner?

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4 minutes ago, Grasshopper said:

So by that (I have no reason not to believe you)

We have a max of

83mill till 01.06.2017 (exact date?) or the following year?

61mill till 01.06.2018 (?) ditto

&

39mill till 01.06.2019 (?) ditto

My understanding is that assessments are taken out during the current season (March I think) so we've got an £83m loss allowed to March 2017. £61m to March 2018. £39m to March 2019. All assuming we stay in the Championship, of course. 

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Interesting write up from vitalvilla regarding us and FFP 

http://www.astonvilla.vitalfootball.co.uk/article.asp?a=7522978

Quote

There is some truth in this but also some lazy journalism... Dr T stated on Twitter early this morning that 'we need well prepared for the FFP as we inherited heavy burdens. If we get more ins but can't succeed in outs, we'll have headache with FFP.' 
Which shouldn't be a surprise to anyone.With regards to the press stories: 
1. The c.£81m loss reported for the 12 months to 31 May 2016 appears to relate to that reported in Reform Acquisitions Limited - the UK Holding Company - for the Aston Villa Group, not the company that is the Football Club and presumably the member of the EFL; it therefore includes a number of non-football club losses which I cannot believe are included in the return to the EFL for FFP purposes (apparently 'Regulation 16.4 applies but I cannot find it); 
2. More importantly the £81m loss is the amount reported, whereas the FFP rules (which are available on the EFL website) state in section 4.2 that the loss reported is adjusted for many items, including 4.2.2 'depreciation / impairment of tangible fixed assets'. The £81m loss included the small matter of £3.7m of depreciation of TFA and £44.8m of impairment of TFA'. 
Both of these are non-cash items, and in the case of impairment, largely affected by the opinion of the board of directors and I can't imagine a case would have been put forward for such a write-off if it impacted on FFP! 
3. FFP makes some provision for shareholder equity input so Dr T could (or may already have done so) inject some funds to offset losses for FFP reporting purposes. 
FFP appears to be for a rolling three year period as follows: 
'Financial Fair Play 2016/17 
This season sees the implementation of a new set of 'Profitability and Sustainability` regulations that will deliver a consistent approach to Financial Fair Play for those clubs that move between the Premier League and Championship through promotion and relegation. 
Championship clubs voted to change their FFP rules in November 2014 as part of wide-ranging negotiations with the top-flight about future solidarity arrangements that has contractually linked the finances of the EFL and Premier League for the first time since the formation of the latter in 1992. 
The £13m limit for the 2015/16 season is in line with the losses permitted under the new regulations which will permit a maximum loss of £39m (compared to an equivalent figure of £105m in the Premier League) over a rolling three season timeframe measured from March 2017. A club that moves between the Premier League and Championship will be assessed in accordance with the permitted loss in the relevant divisions played in during the three-year period in question. For example, a club that had played two seasons in the Championship and one in the Premier League would have a maximum permitted loss of £61m, consisting of one season at £35m and two at £13m. 
Read more at www.efl.com 
Thus a 3 year rolling amount of losses allowed, with a higher proportion for the years in the Premier League. 
Not only does our income fall the longer we stay in the Championship (reducing parachute payment over 3 years) but so does the maximum amount of losses permitted under FFP - a double whammy - it will be harder to compete the longer we stay in the Championship - stating the bloody obvious.... 

Read more in the forum thread: Click Here

Need to Swiss Rambler to do one if their legendary in depth analysis' but from im reading the above it appears to me that financial Armageddon is not close to being upon us just yet. And that Dr X is excercising prudence & caution in giving Bruce more $$$ to safeguard the next managers ability to spend.  

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1 hour ago, thabucks said:

Interesting write up from vitalvilla regarding us and FFP 

http://www.astonvilla.vitalfootball.co.uk/article.asp?a=7522978

Need to Swiss Rambler to do one if their legendary in depth analysis' but from im reading the above it appears to me that financial Armageddon is not close to being upon us just yet. And that Dr X is excercising prudence & caution in giving Bruce more $$$ to safeguard the next managers ability to spend.  

The frequent use of phrases such as "I can't imagine", "presumably", "I can't believe", etc., in the article don't exactly fill me with confidence. Doesn't anyone actually know FFS? On the immediate face of things, the reported £81m loss last year eats up most of our 3 year "allowance" of £83m.

Edited by briny_ear
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Well I am still confused about FFP (financial Fair Play)....

How come Chelski, Man Ure, Man C$ty can all able to buy players with hyper inflated transfer fees and wages with countless 10's of millions of £, and yet Stoke, Watford etc etc cannot......where is the fair play with that?

Personally I think the usual top 4/5 have contrived to sew the whole premier league thing up with Sky TV to be honest. Leicester were an anomally last season.

The premier league is now as boring as the "Scottish Pointless League", where Celtic will always win it or a few years ago it was shared between them and Rangers.

We can already predict the top 4/5 in the premier league for the end of next season......zzzzzzzzzz

All the best

Del

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