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The AVFC FFP thread


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1 hour ago, tomsky_11 said:

What's the source for this? I'd seen something about the increase above previous deal being split at a ratio 1.8:1 from the top to bottom club.

The Athletic, I googled it. They gave the top and bottom figure and I calculated the prize money on a linear basis from those two. 

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24 minutes ago, Villaphan04 said:

not sure if this fits with the thread but would apply to a future FFP. 

 

 

It applies now, to be honest, because any club wanting to play in Europe needs to comply. That would include Villa.

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30 minutes ago, blandy said:

It applies now, to be honest, because any club wanting to play in Europe needs to comply. That would include Villa.

Exactly. But the thinking is sneaky from Henry here. The advantage we have as the smaller club not in Europe is we can exceed the 70% as we will have a revenue bump by qualification to Europe. Thus we can be more competitive in general in the PL.

Spend say 80% of turnover on squad cost and qualify for Europe and our turnover increases. 

So clubs can financially plan based off the minimum prize money and match day revenue from Europe as part of the income for 70% and run higher when not in Europe

Basically the UEFA rules make PL more competitive now than if we brought in the same rules.

Our owners aren't stupid. They won't be in agreement with this proposal. Might agree on 80% or similar for PL eventually 

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5 hours ago, tomsky_11 said:

We've had 14 and are scheduled for another 3, with 4 rounds on fixtures not yet assigned for broadcast.

Don't think will be much different to last season. Fixtures on our wiki for the season have 17 as TV games, but I think they've missed at least Liverpool and Man City at end of the season so at least 19.

Broadcast money should be more next season either way, due to the new international rights deal (I think could possibly be extra £10-15M) and also our higher league finish (as it stands around £7.5M, as it's apparently about £2.5M per league position)

 

Isn't the number of games irrelevant? If the TV money is based on finishing position, what does appearing more get us? If we get additional tv income got the games shown then we should do very well out of it. 

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8 minutes ago, CVByrne said:

Exactly. But the thinking is sneaky from Henry here. The advantage we have as the smaller club not in Europe is we can exceed the 70% as we will have a revenue bump by qualification to Europe. Thus we can be more competitive in general in the PL.

Spend say 80% of turnover on squad cost and qualify for Europe and our turnover increases. 

So clubs can financially plan based off the minimum prize money and match day revenue from Europe as part of the income for 70% and run higher when not in Europe

Basically the UEFA rules make PL more competitive now than if we brought in the same rules.

Our owners aren't stupid. They won't be in agreement with this proposal. Might agree on 80% or similar for PL eventually 

Absolutely.  It's ridiculous if this comes in for the PL. I think it may also be why the PL haven't yet adopted it. If they wanted to they'd have done it when UEFA did. I know times change, but hopefully they don't cave. 

You only have to look at what the top 6 can spend while achieving the 70%, vs the rest of the league who don't even achieve 90%, to know that the rest of the league would be screwed if it came in.

Competitive it would not be. Man is a fool if he thinks it would help anyone outside the top 6 be more competitive. 

 

Edit:

I did a check and this suggests it's not as bad as I thought, but would still hinder more of the league than it helps:spacer.png

 

Edited by MrBlack
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25 minutes ago, MrBlack said:

Isn't the number of games irrelevant? If the TV money is based on finishing position, what does appearing more get us? If we get additional tv income got the games shown then we should do very well out of it. 

There's a bunch of different buckets for both UK and international TV rights money that get distributed. Some are evenly spread across the league. Then there's a pot for league placing. Or two now I think with the international deal changes. Then there's a payment for every live UK fixture. Have seen it suggested this is just shy of £1m per game. And @CVByrne I think said earlier there might be an min and max amount payable with this.

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Do these new Uefa rules mean there's a point at which qualifying might not be good for us? Eg. finish 7th and geting into the Conference League with our wages, amortisation and revenue where they are at now? If wages don't move and amortisation is as expected for 22/23 then the combined cost is £235M. That could easily be £20-30M above this years turnover. I'm not sure we make that up whatever additional revenue the Conference League brings (looks like Spurs got about £10M prize money in 21/22 for example). I guess they'd be actions we could take through sales and contract extensions to bring some of the cost side down. But then surely there'd also be additional costs through bonuses, transfer add ons, etc for qualifying.

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22 minutes ago, tomsky_11 said:

Do these new Uefa rules mean there's a point at which qualifying might not be good for us? Eg. finish 7th and geting into the Conference League with our wages, amortisation and revenue where they are at now? If wages don't move and amortisation is as expected for 22/23 then the combined cost is £235M. That could easily be £20-30M above this years turnover. I'm not sure we make that up whatever additional revenue the Conference League brings (looks like Spurs got about £10M prize money in 21/22 for example). I guess they'd be actions we could take through sales and contract extensions to bring some of the cost side down. But then surely there'd also be additional costs through bonuses, transfer add ons, etc for qualifying.

The player cost cap is forward looking like the way La Liga do it. So we can factor in the additional income from the Conference League into our forecast. It starts at 90% then 80% then 70% over the years and clubs can choose on 3 year average or the current season. So they're making it less difficult a transition.

For us if we qualified this season yes it would be an issue. Getting into Europe would limit our ability to spend this summer if we wanted to comply with the rules. I assume we would just disregard the rules and take a penalty (probably at worst loss of prize money or points deducted from the conference league) than sacrifice PL performance for it.

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2 hours ago, MrBlack said:

 

 

Edit:

I did a check and this suggests it's not as bad as I thought, but would still hinder more of the league than it helps:spacer.png

 

It is worse than you think. This graph you show there only looks at wages. Uefa cost controls include "squad cost" ie wages plus amortisation 

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2 hours ago, MrBlack said:

I did a check and this suggests it's not as bad as I thought, but would still hinder more of the league than it helps:spacer.png

 

Nice find, although I’d be amazed if any of these are accurate or a fair reflection of what’s actually happening at the business level. So many accounting tricks that can be used to increase “revenue” in an individual year, and there’s no real reason to single out wage costs when some clubs likely have other line items that are absolutely enormous.

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2 hours ago, KentVillan said:

Nice find, although I’d be amazed if any of these are accurate or a fair reflection of what’s actually happening at the business level. So many accounting tricks that can be used to increase “revenue” in an individual year, and there’s no real reason to single out wage costs when some clubs likely have other line items that are absolutely enormous.

I was singling out wage costs as I thought that was what uefa calculated their FFP calculations on.  Per Czar below, he suggests its a bit more so yes, teams will be way more in trouble if this came in than that image suggests. 

And you are right about the revenue thing too. Absolutely fictional revenues will be appearing in City's accounts, hopefully the PL prove it. 

2 hours ago, Czarnikjak said:

It is worse than you think. This graph you show there only looks at wages. Uefa cost controls include "squad cost" ie wages plus amortisation 

I thought the UEFA calc was based on wages. So you are right then, royally shafted if it comes in. Intriguing to see Arsenal and Chelsea breaching the 70% figure on wages alone though if that's the case. Are UEFA coming after them for it?

 

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2 minutes ago, MrBlack said:

 

I thought the UEFA calc was based on wages. So you are right then, royally shafted if it comes in. Intriguing to see Arsenal and Chelsea breaching the 70% figure on wages alone though if that's the case. Are UEFA coming after them for it?

 

No, as it’s not 70% yet, uefa is slowly phasing it in, starting from 90%…I’m not even sure if the new regs apply already.

also your graph only shows “revenue”. I’m pretty sure uefa also allows you to add your profit on player sales into equation . Especially Chelsea, rakes in millions on their academy cast offs.

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40 minutes ago, Czarnikjak said:

No, as it’s not 70% yet, uefa is slowly phasing it in, starting from 90%…I’m not even sure if the new regs apply already.

also your graph only shows “revenue”. I’m pretty sure uefa also allows you to add your profit on player sales into equation . Especially Chelsea, rakes in millions on their academy cast offs.

hopefully our academy will be an FFP fund soon.......

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6 hours ago, MrBlack said:

Absolutely.  It's ridiculous if this comes in for the PL. I think it may also be why the PL haven't yet adopted it. If they wanted to they'd have done it when UEFA did. I know times change, but hopefully they don't cave. 

You only have to look at what the top 6 can spend while achieving the 70%, vs the rest of the league who don't even achieve 90%, to know that the rest of the league would be screwed if it came in.

Competitive it would not be. Man is a fool if he thinks it would help anyone outside the top 6 be more competitive. 

 

Edit:

I did a check and this suggests it's not as bad as I thought, but would still hinder more of the league than it helps:spacer.png

 

That top 4 clubs in that list are in serious danger. You can see from that list that clubs are trying to keep to around 70 anyway.

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8 hours ago, Czarnikjak said:

No, as it’s not 70% yet, uefa is slowly phasing it in, starting from 90%…I’m not even sure if the new regs apply already.

also your graph only shows “revenue”. I’m pretty sure uefa also allows you to add your profit on player sales into equation . Especially Chelsea, rakes in millions on their academy cast offs.

Yes profit on player sales will be included in the income side and the cost is Wages + Amortisation + Agent Fees. So ratio of those 3 divided by income <70% (when season is over). 

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so what i have got from this thread so far is:

  • We have a fair amount of FFP wriggle room and could feasibly spend a good amount of money this summer.
  • We have no money and are skirting on the edge of FFP, and will not be able to spend much at all this summer.

ok, got it :P

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6 hours ago, MaVilla said:

so what i have got from this thread so far is:

  • We have a fair amount of FFP wriggle room and could feasibly spend a good amount of money this summer.
  • We have no money and are skirting on the edge of FFP, and will not be able to spend much at all this summer.

ok, got it :P

Ha. I think the summary (which has actually longer than anticipated so TLDR: I wouldn't worry for at least another year or two) in terms of FFP is:

  • for 21/22 and for when we publish this season's accounts we'll be easily within FFP limit.
  • the 21/22 accounts especially will give up plenty of capacity for losses (possibly up to £100m in pre-adjusted losses) in 23/24 while still passing FFP
  • there's a question mark about how much of those losses might already be baked into 23/24 before we add in any summer activity, if it's anything like 21/22 then it could be £80-90M, which gives some room but not much
  • I think there are more ways in which this base position could end up better (eg. increased revenue, spreading existing book values further, player sales) than being worse
  • If the club are saying they think they've got the capacity to spend, I think the numbers so far (ie. we'll be a long way from FFP limits based on the first two of the three year assessment period) suggest it's a reasonable statement
  • The bigger worry might be 24/25, but if spending in 23/24 when we have the capacity to do so helps us secure European football then it should be worth it and might actually make 24/25 look better.
  • The risk is spend and not make Europe in 24/25. That might not look so pretty.
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