duncanjwitham
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Posts posted by duncanjwitham
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14 minutes ago, Oldben said:
I think the clubs leeway is connected to Sheffield wednesday who were given a 12pt deduction, reduced to 6pts on appeal.
I've never actually looked at the Sheffield Wednesday written reasons for the appeal points reduction, so just had a skim through. The main reason their points deduction was reduced was because their stadium sale, while not occurring in the right year, was actually pretty close to it (a couple of weeks after their accounting period closed). And they'd informed the EFL of their intention to sell long before that. So their LAP basically took that as mitigating circumstances - they were actively trying to do something that would've meant they were within the allowed limits, and so they should get some credit, even though they never quite made it in time.
How that would translate to a potential appeal/agreed-decision from us is interesting, because we never actually took the corrective action that Sheffield Wednesday took. But we had no reason to think we actually had to, because as far as we were concerned we'd met the limits (allowing for the stadium sale etc). So I honestly don't know if there's any direct parallels or precedents set between the 2 cases. I certainly don't think you can just say something like they got theirs halved, so ours should be too.
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11 minutes ago, Coconut's Beard said:
Did the club assert that, that we weren't looking to gain any advantage whatsoever (even a completely fair one), or are you just quoting posters on here saying that the club asserted that?
I'm not sure the club has ever asserted that. In public anyway. The clubs stated position was always that the ERV method was a better fit for how we intended to use the transfer market (buying players, developing them and selling them on) than a straight-line method. And under FRS102, that's fine - you are supposed to use the model that best suits your particular use-case (providing it's legal, of course).
The "gained no advantage" line comes from DC2, but it should be made clear that specifically applies to the amortization method alone, not any indirect results of it. The amortization policy itself didn't give us more leeway in the transfer market, that's why we basically got a slap-on-the-wrist fine for it. The net result of that policy might have been in some years we gained more leeway, at the expense of having less leeway in future years. The position in DC2 was that if that is the case, and that extra leeway allowed us to overspend, it should be dealt with as a separate issue, because it's not the amortisation policy that's wrong, it's the overspend.
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2 minutes ago, Spanish said:
I think we got a very fair hearing from DC1 and more supportive than I expected. They drew no negative conclusions from the lack of evidence retained by he club. I do wonder why our auditors did not ask to review this material. Throughout this I have believed they were very culpable and I am surprised that the club is not suing their PI
I honestly don't know enough about the auditing process to know if that should have come up or not. And It's probably difficult to judge from outside anyway, given we don't know what else was actually shared with them beyond the published accounts. They may have seen enough documentation of the process, if not the actual workings for individual players, to think it was fine.
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4 minutes ago, Spanish said:
that and this from DC1, damned with your own evidence
Mr Pearce and Mr Delve described the Notes in the Club’s financial statements as (1) Being ‘… arguably ambiguous and could lead a reader to interpret the Club’s policy in an incorrect way’ (Mr Delve), and (2) Using ‘possibly slightly misleading terminology …’ (Mr Pearce)
But to counterbalance that, from DC2:
It carries on further but you get the idea. So the description was misleading, but it's not like it was utterly incorrect. The big picture was right, it was the details that were ambiguous. We weren't trying to claim we were using straight-line when we weren't or anything remotely like that.
But certainly there have been massive mistakes made by us, the lack of documentary evidence for calculating the player values being another one. And that's what makes it so frustrating. If we had just kept better records and found an accountant to say what were doing is fine, this mess would probably have ended months ago.
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6 minutes ago, Spanish said:
DC2 is an odd read. The best I can surmise is the breach is the impermissible use of resale values in amortisation calculations. I am not sure how we can put in restated accounts which include an element of this if that is the case
To me, DC2 reads very much to me like they know the LAP are wrong, but they just can't do anything about it.
I suppose it's telling that DC2 doesn't seem to specify how we restate the accounts, only that we have to (and they must be FRS102 compliant). You could argue that if they had decided that straight-line was the only acceptable way, they would have mandated it in the ruling.
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19 minutes ago, Spanish said:
good points as usual. I interpreted that they didn't cross examine him because no new evidence is allowed in an appeal?
the lack of our own expert witness was picked up by LAP wasn't it?
I'm not actually sure of the exact process, but my take on it was basically they read the written reasons and pointed to the bits where they thought the DC had screwed up and that's pretty much it. It certainly wasn't a full hearing with witnesses, and definitely with no new evidence. I think the club and EFL may have made submissions too, but I'm not even sure if they were present for the hearing, or just submitted in writing. The only thing they had to go on to judge Pope's credibility was what was documented at the time - in the written reasons, and I suppose possibly in other notes etc (not sure on that bit).
And yeah, the lack of our own expert witness was mentioned both in DC1 and the LAP, IIRC. Maybe hindsight's a wonderful thing, but it certainly seems like a massive mistake, of our own making, now.
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1 minute ago, Half Fan Half Biscuit said:
Yes - I stand corrected - Club weren't actually revaluing players above cost so revaluation method wasn't being used. Therefore nothing FRS102 says about that method applies.
So it comes down to
18.22 . . . The entity shall choose an amortisation method that reflects the pattern in which it expects to consume the asset’s future economic benefits. If the entity cannot determine that pattern reliably, it shall use the straight-line method.”
Exactly. And the DC found that our method was both systematic and reliable. The EFL appealed over those too, and the LAP found no reason to overturn them. So as far as the EFL's disciplinary process goes, we have a reliable way to determine the way we expect use those economic benefits. We're just not allowed to use it because... erm... ?♂️
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2 minutes ago, Half Fan Half Biscuit said:
The stumbling block to me with the Club's approach is the requirement that prices are available to the public. You don't see players advertised for sale on a public facing website.
18.18B Under the revaluation model, an intangible asset shall be carried at a revalued amount, being its fair value at the date of revaluation less any subsequent accumulated amortisation and subsequent accumulated impairment losses, provided that the fair value can be determined by reference to an active market.
“Active market” is defined in the Glossary as follows; “A market in which all the following conditions exist: (a) the items traded in the market are homogeneous; (b) willing buyers and sellers can normally be found at any time; and (c) prices are available to the public.”
And wouldn't (b) be a problem too - how many willing buyers were there for Anya, Blackman and Butterfield?
This to me gets to the root of it. The LAP document is entirely about Cost Model vs Revaluation Model, and saying we're using the Cost Model but sneaking in features of the Revaluation Model. I don't believe (not an expert etc) that that's what we were doing at all. We weren't 'revaluing' the assets in the sense that we had pride Park revalued before we sold it. We were purely trying to estimate (as reliably and systematically as possible) what percentage of a players "economic benefits" we might derive from selling them on. So none of the arguments about active markets and public prices apply, because we weren't 'revaluing' in that sense. I think the DC, with their accountant on board understood this and waved it through. The LAP with no experience in the field *at all* did not grasp this and that's why we are where we are.
Again, not an expert etc.
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24 minutes ago, Gladram said:
But they aren't 'experts'? just IDC members, so it needed countering by another expert to enable them to form this view. I think this is why the LAP found against us.
Well at least one of them was, by design. The rules say at least one of the DC members must be an accountant for matters like this.
Although us not providing our own expert witness is ultimately the reason we lost IMO. And it's a mistake entirely of our own making.
10 minutes ago, Spanish said:the response was to the laughed at comments. What did the LAP think of the prof?
It's interesting - the LAP written reasons explicitly state that the evidence of our accountants and auditors can't be classed as "expert evidence" because they were called as factual witnesses, not experts. And because of that, it did not give the DC the chance to examine their qualifications and experience and decide whether they were worthy of taking into account. But the exact same applies to Pope - they did have chance to examine his qualifications and experience and found them lacking, so disregarded him. The LAP didn't get to speak to Pope or cross-examine him, they are entirely going by documents arising from the first hearing. So they've taken the quotes I posted earlier and basically decided the fact he was unaware of the rules he was being an expert on, didn't actually matter ?♂️.
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4 minutes ago, Spanish said:
Which was a mistake, if they had reviewed it then justified why it was not appropriate, then the appeal may have fallen short. He is a professor after all, you may not agree with him but show him some respect. You clearly believe you know better than him though so perhaps I should show you the same amount of respect
They did that. Just look at the quotes I posted on the previous page.
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2 minutes ago, Wolfie said:
Of course I understand rules. I also understand being sneaky and under hand to use whatever loophole is there to gain an advantage - which is what we did - and have claimed it's purely coincidental. BS.
Right now I don't care if we deserve a punishment or not. The EFL aren't going to let this drop until we get one and we're not going to be able to make fresh start until they do.
We're really not talking about "loopholes" are we though? Certainly not in the sense of finding some gap in the law that the authorities didn't intend to be there. The EFL rules say we have to comply with FRS102. Our accountants (and seemingly every other accountant that's looked at it properly) think we do comply. We just happen to do things a little bit differently because (shocker, I know! ?) companies choose to organise their accounts in a way that suits the way they want to do business. You can't have flexibility in the rules and then have a toddler-tantrum when not everyone produces exactly the same thing. And let's be clear - that flexibility is there by design, because those rules cover a multitude of different business-types that do different things in different ways, so you'll never get a single uniform set of rules from something like FRS102. So we're again back at the same thing I keep saying - if the EFL want accounts produced in a very strict and controlled way, they need to write the rules for it and publish them. You can't have the situation where the EFL are enforcing rules that aren't written down.
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1 minute ago, angieram said:
As in -9 for annoying the EFL?
The FFP rules say you get docked up to 12 points, based on the exact amount of overspend. Up to an additional 9 points can be added on for “aggravating circumstances”, which is supposed to be for things like deliberately hiding what you’re doing, knowingly breaking the rules etc. In our case there’s no way that should apply, because we have pages and pages of stuff from the DC written reasons about us gaining no direct sporting advantage from the amortisation policy, and having no reason to suspect what we’re doing was against the rules etc.
I was (slightly facetiously) suggesting that if we haven’t failed FFP, the EFL might try and tack the 9 points on anyway for what they construe as maliciously (not) breaking the rules.
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5 minutes ago, RoyMac5 said:
Why would we agree to a points deduction - what have we done wrong here?!
We still don’t know what charges the potential deductions even relate to. Are they for failing FFP in the restated accounts, not submitting those accounts on time, the other non-submitted accounts, the HMRC thing, something else?
Honestly, at this stage it wouldn’t surprise me if it’s 0 points because we haven’t failed FFP and -9 tacked on for not failing under aggravating circumstances.
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So we have to assume the missed payments a temporary cash-flow thing. But given that now is probably the most cash-rich we are over the course of the season (with season ticket sales etc, plus the transfer window now closed), there’s every chance it keeps happening sporadically over the course of the season. So the question then becomes, do we end up with some kind of punishment purely for repeated ‘minor’ infractions. After all, the missed wages were paid fairly promptly, but we still have a suspended deduction if we do it again.
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5 minutes ago, Gaspode said:
I suppose the theory is that HMRC don't mess about when money is outstanding so a charge from them could put the club out of business - which is what FFP was intended to address when it was first proposed....
It's also a competition-fairness thing. They don't want one club spending money on players instead of paying HMRC while everyone else is abiding by the rules.
- jimtastic56 and atherstoneram
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3 hours ago, G STAR RAM said:
Are you sure on that?
Not sure such a big deal would have been made if it was only one day.
From memory, it was a day or so late the first time they weren't paid (Jan 2020?). I thought it was more like a couple of weeks this last time.
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34 minutes ago, G STAR RAM said:
or recruiting players that can be sold on at a profit.
Which is considerably more difficult now you can’t really import cheap European players.
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44 minutes ago, Crewton said:
Fozzy's past disciplinary record and generally laid-back demeanour makes it hard to believe it was a deliberate act, but as the "stamp" came as a separate action after he'd initially landed, I'm not surprised it's been judged severely.
Football supporters in general are one-eyed when it comes to the actions of their own players and judge the opposition players entirely differently. Forest fans are probably amongst the worst for this kind of hypocrisy, but when one of their biggest icons is Stuart Pearce, that's to be expected.
"Separate action" is a bizarre way of describing it. It's that very landing that causes him to put his foot out to balance himself. He lands on an unexpected and uneven surface (the Forest guys leg), of course he's going to put his foot out to right himself.
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Just now, Van der MoodHoover said:
That was only the last couple of posts? I thought that the conversation was about the charge and then nixons tweet suggesting that there was equal guilt by other unnamed parties.
Oh well, if not then just ignore my post and carry on ?
The tweet I was replying to was suggesting it could still be for Ince, or the likes of Evans, Bennett etc. I suspect it’s one of the major transfers in the last few years, which probably narrows it down to Bogle/Low, or maybe Whittaker.
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1 minute ago, Van der MoodHoover said:
There are no limits or thresholds mentioned in the rules that I have seen quoted.
So unless the EFL are making it up as they go along........oh....hang on.... ?
I’m not talking about the rules. We were trying to figure out who owes us money (and who we owe it too as well). I’m just saying it’s more likely to be from a big transfer than a small one. Clubs aren’t going to risk embargoes for chump change, if they fail to make a payment it will almost certainly be for a substantial payment that they can’t afford to make.
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12 minutes ago, Van der MoodHoover said:
But is it not the principle of the thing?
We don't know that the amounts we owe are material...just that we owe something to someone.
Let’s say Millwall owe us £25k for Bennett - they probably aren’t going to have any problems paying that, and certainly wouldn’t want to risk an embargo over something that low. If another club has failed to pay us something, and especially if it has materially affected our ability to pay something we owe, it’s not an unreasonable assumption that it’s at least a moderately substantial payment. And that narrows it down to a very small number of transfers.
The same logic applies to us of course. I suspect it’s unlikely we’ve failed to pay monies owed for the likes of Marshall and Byrne, it’s far more likely to be Jozwiak or Bielik.
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39 minutes ago, Tyler Durden said:
Doesn't seem much evidence of any special relationship or any relationship fullstop tbh which would be in jeopardy which I guess is the whole point of this thread.
They still need access to the club for matchday broadcasting, player/manager interviews and so on. If the club were to ban say Dawes or Nicholson from the ground, or refuse to let them attend pre-match press briefings, then they literally cannot do the job they're being paid to do. Like it or not, they need to maintain a reasonable working relationship with the club.
It's a completely different case for people like Percy or Nixon who are paid by national newspapers, and only rely on having a few contacts at clubs. If their relationship with the club breaks down, they lose very little.
Embargo.
in Derby County Forum
Posted
IIRC Gibson’s argument was that we had used our extra financial headroom to outbid them on buying Waghorn. And apparently having Waghorn, for reasons that science can not yet explain, gave us an advantage ?♂️.