The AVFC FFP thread

[villa4europe]

Martin Samuel piece in the mail

http://www.dailymail.co.uk/sport/football/article-5792685/Powered-spite-vultures-tearing-Aston-Villas-carcass.html

Powered by spite, vultures are tearing at Aston Villa's carcass after relegation in 2016 destroyed their finances

There are many reasons for relegation; few signpost administrative excellence

Incompetence: that is the common denominator for why teams are relegated

Despite signing John Terry, the last two terms for Aston Villa have been austere

Aston Villa did not end up in the Championship because they were getting it right. The same as any Premier League team, really. Poor recruitment, poor managerial choices, poor executive decisions; there are many reasons for relegation and few signpost administrative excellence.

Incompetence: that is the common denominator. That is why fortunes are often spent and wasted scrambling to survive. Queens Park Rangers had one final, costly splurge before disappearing below the surface. Sunderland bought 80 players during Ellis Short's time as chairman and could sell only six of them for a profit.

Aston Villa are no different. In the season they went down, they sold Christian Benteke and Fabian Delph for good money — which might explain it — but frittered away those proceeds on players who disappointed or were powerless to arrest the decline.

Jordan Amavi, Idrissa Gueye, Jordan Ayew, Rudy Gestede, Jordan Veretout and Adama Traore cost a combined total of £47.5million. Not one was sold on beneficially after relegation.

That is what demotion does. It makes a player damaged goods and ruins his asking price.

The seller begins with grandiose claims — Stoke want £30m for goalkeeper Jack Butland, it is reported — but then reality sets in and they take what the market dictates.

Relegation in 2016 destroyed Villa's finances. Their most recently reported figures confirm that. A loss of £29.6m was posted in the relegation season.

Then turnover dropped by £35.6m in 2016-17 as all commercial revenues fell, including £2.9m in gate receipts, £17m in broadcast rights, £9.1m in sponsorship and £6.4m in merchandise, royalties and corporate entertainment. Villa shed 122 full-time staff and 539 personnel in total.

Villa frittered away income on players powerless to arrest relegation, such as Rudy Gestede 

Despite the signing of John Terry, the last two Championship years have been austere

Despite the acquisition of a stellar name in John Terry, the last two Championship years have been austere. Finishing 13th in the first season inspired the determination to recruit a player of Terry's stature and experience but, in reality, times are hard. Steve Bruce, the manager, spent only £2.5m last summer, while raising £18m in player sales.

Villa missed out on promotion to the Premier League in the play-off final against Fulham and now the vultures are descending. For there is nothing the Football League enjoys more than tearing through the carcass of a Premier League club that has stuffed up.

Villa still have an estimated £40m hole in their finances, left over from trying to compete in an elite division, and the Football League will not rest until it is plugged.

If Villa have to give up everything that is good about the club, if they have to surrender players, prospects and facilities, if they have to embrace the mediocre, join a race to the bottom, that is fine. The Football League are only too willing to embrace mundanity. It's ambition that terrifies them.

Item number one: Jack Grealish. A tiny flicker of hope for Villa fans these last two seasons that they might have a young player at last emerging as a significant performer. Grealish has had his disciplinary issues but this season, in particular, he appears to have grown up and grown comfortable with his ability, accepting responsibility as a key member of the team.

Jack Grealish has been the highlight of a tough few years but naturally, he has to be sold

He is a Villa supporter, Solihull-born, and has been around the club since he was six. At the age of 16 he was named on the bench for a Premier League match against Chelsea and now he has made more than 100 appearances.

There hasn't been much for Villa fans to get excited about of late, but Grealish is the best of it. Naturally, he has to be sold.

So, what is the purpose of that? What is the purpose of a rulebook that punishes a club for its past mistakes, that strips away the best of it, the promise of it just at the time when it could most do with support?

There is even talk of Villa having to sell their Recon Training Complex, formerly known as Bodymoor Heath, one of the most advanced facilities of its kind in the Championship. This is where the next generation of Villa stars learn their trade.

The League are not making Villa economically viable. They are forcing them to cash in on their only assets. If Villa were becoming streamlined by shedding waste, that would be different but this is a yard sale of the family silver.

How does it benefit Villa to lose Grealish and the facility that helped produce him. How is that beneficial or healthy?

From the going to the already gone: Terry, the man Grealish credits with encouraging his new professionalism and a player Bruce says has been inspirational in his influence, was not even offered a new contract. Villa cannot afford a second season of that positivity, so he has already said farewell.

James Chester and Robert Snodgrass are also likely to leave the struggling Championship side

Other loan players, such as Robert Snodgrass, a Scotland international, are expected to follow.

Quality is in short supply where Villa are heading. James Chester is another likely to be sold. Villa took him from West Brom in 2016 for around £8m and would have expected to turn a profit, but can they now, in the circumstances?

As this is a very public fire sale, clubs will try to force the price down — particularly with the transfer window closing earlier than ever, another bright idea. Take it or leave it will be the option in the knowledge that leaving could result in drastic FFP fines, and further ruination.

The old cliche is that Financial Fair Play prevents another crash like the ones at Portsmouth or Leeds, but Villa were not about to go skint. Owner Tony Xia has not been able to turn them back into a Premier League club but the sustainable future that he spoke of this week did not have to be reached in a state of panic.

Villa have suffered losses and setbacks, but the signs are Xia was beginning to bring that under control. To then have to lose his best players, maybe a good manager and a prime club facility to avoid further unjust financial punishment is a savage penalty in itself.

As ever, FFP causes measures to be undertaken in a mood of haste or anxiety. Wolves bet the farm on winning promotion this season, knowing if they failed the Football League would be after them. Villa fell short, so now it is their turn.

Far from achieving financial security, does anyone seriously believe Villa will be better off for losing their best players, including one — Grealish — who is the greatest beacon of hope?

In its current form, the Football League's financial rules are not fair but spiteful and potentially devastating.

Just by being within the grasp of the League's executives, haven't Villa been punished enough?

 

 

[villa4europe]

23 minutes ago, punkiller1981 said:

So the is a story in the telegraph saying we are so broke that we can’t even afford Alan Huttons wages so we are not offering him a new contract. No side line of weather we actually wanted to offer a contract or that we thought he wasn’t worth the money at 34 years old just that we can’t afford him. I’m starting to get very bored of the financials. Yes are position isn’t great but it’s not like we won’t probably have a higher budget than 95% of the other teams in the league.

this is the frustrating bullshit thats circling us right now, any sensible discussion about huttons contract goes out of the window and not even lazily gets labelled as something, its worse than that its purposeful shit stirring

there are several reasons that he's not getting a new contract and this has been a fact since long before we lost the playoff final

[HanoiVillan]

Ultimately, I'm not an accountant, and I'm not interested in finances. What I do know, though, is that it was always the case that of the 24 teams who started last season, 21 of them would fail to achieve promotion. That's not great odds, even if you're feeling confident, so if the club really have got no plan in place to cope with this entirely foreseeable eventuality then questions absolutely have to be asked of Xia and Wyness, because that would be utterly negligent. 

[Alakagom]

32 minutes ago, HanoiVillan said:

Ultimately, I'm not an accountant, and I'm not interested in finances. What I do know, though, is that it was always the case that of the 24 teams who started last season, 21 of them would fail to achieve promotion. That's not great odds, even if you're feeling confident, so if the club really have got no plan in place to cope with this entirely foreseeable eventuality then questions absolutely have to be asked of Xia and Wyness, because that would be utterly negligent. 

The plan from day one was clear. Look at Championship goal scorers and assists table. And buy the top ones. Plus use Bruce's contacts at old clubs to get few loanies.

I honestly think there's wasn't much more to it

[TRO]

11 minutes ago, Alakagom said:

The plan from day one was clear. Look at Championship goal scorers and assists table. And buy the top ones. Plus use Bruce's contacts at old clubs to get few loanies.

I honestly think there's wasn't much more to it

Er.....If it was, I am going to cry.......................................with frustration.

[bobzy]

Am I missing something? The punishments for failing to meet FFP seem to be fines or maybe points deductions. Why do we need to plug a £40m gap right now? Can’t we just sod it, take a fine/points deduction and continue to settle the club down?

maybe I’m naive. I just don’t get why it’s a necessity to sort out the shortfall. 

[omariqy]

2 hours ago, mrjc said:

Yes, that quote is true - the difference is in the technical explanation. Wages aren’t amortised (they are incurred each year as they are paid), whereas the transfer fee is amortised (it’s an asset which is paid for on day 1, and spread over the life of the asset - ie, the contract length). 

So when we sell hogan, we take the fee but have to write off any remaining unamortised asset value - as you have done with the transfer fee bit. But we only save his wages next year, because that is all we would have incurred in our P&L anyway. 

Sorry, maybe not explaining it the best - but on your spreadsheet our saving for next year’s FFP is the annual salary, plus transfer fee, less unamortised asset value. 

Is that a better reflection or should I not count the wages of Gollini, Gil, Amavi and Gardner as they were out on loan last season?

[hippo]

3 minutes ago, bobzy said:

Am I missing something? The punishments for failing to meet FFP seem to be fines or maybe points deductions. Why do we need to plug a £40m gap right now? Can’t we just sod it, take a fine/points deduction and continue to settle the club down?

maybe I’m naive. I just don’t get why it’s a necessity to sort out the shortfall. 

Because the scope of the fines have been ramped up - It wouldn't just be a £2.5m fine for example - QPR got fined £40m - punishment could also be points deduction, relegation, or voiding a promotion placing. I think the QPR story has made people take notice.

[TRO]

1 hour ago, villa4europe said:

Martin Samuel piece in the mail

http://www.dailymail.co.uk/sport/football/article-5792685/Powered-spite-vultures-tearing-Aston-Villas-carcass.html

 

 

Wow....seems like we have got a sqwingen of friends outside B6......but nevertheless, so sad reading that, like reading your own Epitaph.

I think Martin Samuel is right.....We have started to get things right off the pitch, but this blow has come a bit too soon...... 2 goals would have changed so much.

[mrjc]

30 minutes ago, TRO said:

Wow....seems like we have got a sqwingen of friends outside B6......but nevertheless, so sad reading that, like reading your own Epitaph.

I think Martin Samuel is right.....We have started to get things right off the pitch, but this blow has come a bit too soon...... 2 goals would have changed so much.

He’s certainly not right about us having had two years of austerity though!

[mrjc]

1 hour ago, omariqy said:

Is that a better reflection or should I not count the wages of Gollini, Gil, Amavi and Gardner as they were out on loan last season?

Thanks.  My view (sadly)...

We'll only save half a season on Grabban and Tuanzebe, as they were only here for half of last season.

I think with Amavi we actually ended up loaning him initially, and then selling him (sale announced in October, from memory).  I have seen it mentioned a few times that the money may come in next season, but I'm not sure this is accurate and don't understand how it could impact from an accounting point of view.  So I don't think Amavi has any impact next season (other than maybe from when we were paying him in July / August?).

RDL / Gollini / Gil - agree, their wages shouldn't be counted in full.  It depends how much we were paying of their wages - if 50%, then that is what we would save.

So maybe a bit less than that above.

Sorry - not trying to be negative as I like what you're trying to do!  Loans out can be good for some players too - eg, McCormack, where we don't want to make a loss on his fee, but could ideally get someone paying a portion of his wages.

 

[HanoiVillan]

8 hours ago, Alakagom said:

The plan from day one was clear. Look at Championship goal scorers and assists table. And buy the top ones. Plus use Bruce's contacts at old clubs to get few loanies.

I honestly think there's wasn't much more to it

I'm not talking about the plan to get promoted; I understand what that was. I'm talking about the apparent absence of a plan in the case of us not getting promoted. 

[Demitri_C]

9 hours ago, villa4europe said:

Martin Samuel piece in the mail

http://www.dailymail.co.uk/sport/football/article-5792685/Powered-spite-vultures-tearing-Aston-Villas-carcass.html

 

 

Spot on 

[John]

8 hours ago, hippo said:

Because the scope of the fines have been ramped up - It wouldn't just be a £2.5m fine for example - QPR got fined £40m - punishment could also be points deduction, relegation, or voiding a promotion placing. I think the QPR story has made people take notice.

As I heard it there are up to ten clubs who have issues with FFP including the one on the dark side of the city. They don't seem to be doing much (at least publicly) to satisfy FFP.  Are they prepared to take the hit or are they hoping they will get away with it because the authorities are only focused on catching the big claret & blue fish?

[Vive_La_Villa]

2 hours ago, John said:

As I heard it there are up to ten clubs who have issues with FFP including the one on the dark side of the city. They don't seem to be doing much (at least publicly) to satisfy FFP.  Are they prepared to take the hit or are they hoping they will get away with it because the authorities are only focused on catching the big claret & blue fish?

I’m suprised the clubs are not joining forces to fight it. Maybe they are. 

Edited June 5, 2018 by Vive_La_Villa

[TRO]

Maybe the silence from Tony is a further attempt to get to grips with FFP.

Until that imposter is dealt with, we don't know where we are going.

I have no Interest in the accounts.....but it strikes me we are too honest and straight....perhaps a bit a few body swerves are required.

However, I have equally little interest in my club being owned by a Fitness expert or a director of Football either.

Tony, needs to just get on with this and in the mean time.....Martin Samuel's cohorts need to get out their feather quills and expose what a crock of Shite this FFP really is.

Yes, We have been the architect of our own demise.....but with relatively New owners like we have the legacy, should not be able to linger like it does.....its not protectionism, its preventionism....prevention from rectifying past incompetencies.

Its like a swamp and once you are in its hard to get out, a protectionist scheme, should not work like that.

I am not trying to get all gooey eyed in favour of our club here, but it strikes me that our kind of circumstances are basically confined to just a few clubs.....usually the ones with the big infrastuctures who are panicking to get back due to the commensurate overheads and are hastily making decisions to avoid the swamp.

maybe some of those decisions have been too hasty....but only Hindsight tells us that.

I do think an adult conversation with the league, ought to be sought in both camps, to identify any area's that our club has been harshly affected inadvertently by these punitive rules....Much is at stake here.....The football league is nothing without its clubs and here is a fine institution, that is genuinely struggling having missed out on an ambitious attempt to remedy itself, That should not be penalised to having to sell the kitchen sink.

Remember, We didn't get relegated.....We just missed out on Promotion.

Something, doesn't stack up here to me guys and this needs to be discussed at the highest level in the league.....I am not expecting special treatment, I expecting them to re visit our situation and re-examine the fairness that exists surrounding our case within FFP and see if any wiggle room is available to us.

Edited June 5, 2018 by TRO

[Rob182]

Maybe I’m mistaken, but if the initial transfer fee is amortised across the life of a player’s contract, then EFL/FFP would rather a club make a BIGGER loss by keeping that player and paying their wages, instead of the club just selling the player sooner for a SMALLER loss. That itself is just nonsense. Unless I’m getting the wrong end of the stick.

Let’s take Hogan as an example. If we bought him for £10m, then for accounting purposes, that fee is spread across the years that he is under contract with us. So if we decide to cut our losses now and flog him for £3m, then we’ll be making a big loss because of the amortised transfer fee. But it’s not like the amount we’ll pay Brentford suddenly decreases. We’ll still have paid them the same amount for him no matter when we sell him, and for how much. Surely, if for arguments sake we don’t want him, we’re better off, financially, selling him for £3m and taking that hit, than keeping him, paying his pages, and watching his value drop ever further until he goes for free?

I don’t know if I’m making myself clear or whether I’m oversimplying the whole amortisation jiggery pokery. But, it sounds like FFP is massively flawed, and actually hampers teams more than it helps them.

Overall, in my non-professional opinion, FFP is about as useful as a clamp on a ballsack. Yes it might sound like a laugh for a few minutes, but you’ll soon be squeeling like a pig and shoving ice down your pants.

[Dr_Pangloss]

11 hours ago, bobzy said:

Am I missing something? The punishments for failing to meet FFP seem to be fines or maybe points deductions. Why do we need to plug a £40m gap right now? Can’t we just sod it, take a fine/points deduction and continue to settle the club down?

maybe I’m naive. I just don’t get why it’s a necessity to sort out the shortfall. 

It's decided by a panel and can be any of a fine, points deduction or a transfer embargo or a combination of those three, hardly desirable. If we could just 'pay a fine' then it's another high risk strategy that assumes promotion is around the corner, in keeping with the Xia approach I guess but will absolutely explode on us if we fail to meet that objective.

[Demitri_C]

The media always try to destroy clubs. I remember when West ham went down under eggbert that Icelandic guy. They seem to have got over it

They will never kill /break down the fans of the club no matter happens

[Demitri_C]

Wont his happen to boro too if they dont go up? They spent big and didn't go up.