JfR

27 minutes ago, kevinhectoring said:

 

Coconut  

others have pointed these things out or agreed with my comments but I accept I am more outspoken than most. We should all have strong feelings about it because our club’s conduct has been lamentable and foolish. Heads should roll (but they won’t) 
 

I’ve set out a few extracts below from the judgement.  I attached these to an earlier post. Against these, the club statement is a disgraceful, disingenuous whitewash. 
 

Before you read the extracts below:

 appeals tribunals of this sort do not like to comment on behaviour,  they just apply the rules. That’s their job. The last thing they want to do is accuse parties of dishonesty, though sometimes they have to. And when they do they typically use the precious understatement which lawyers go in for. Against this, the comments below are really damning.  The final one, 28 (which has gone viral on Twitter) is a shocker because the tribunal is basically saying: you’re liars. It’s no good our fans pretending it says something else. And it’s deeply worrying the club will not take its medicine. I’ve been a pretty staunch supporter of MM for many years but on this he needs to be called out 

.......................................................

24 These explanations by the Club were at best confusing and at worst seriously misleading. As appears below, they misstated the principles relating to ‘residual values’ (which were always nil at the end of the period of the player contract) (see DC decision [52][58][223b] and [228a]) and wrongly stated that they assumed an ‘active market’, which they did not do.

26 ...the note of the meeting records that the policy was said by the Club to be “in line with that disclosed in the Club’s accounts” (which was quite wrong) and records the explanation that “the Club used residual values when assessing each Player’s amortisation charge” (which was also quite wrong). Given the confusion, which was at least largely the fault of the Club, the criticism of EFL by DC seems remarkably harsh,

28. The DC made disclosure orders in relation to documents in the Club’s control relevant to the accounting treatment. However, the Club did not produce a single document evidencing or relating to the accounting treatment adopted and confirmed that none existed.    

The original DC commented on the lack of certain documents:
"15) As we have said, we were provided with a considerable amount of documentation, the vast majority of which was never referenced by anyone before or during the hearing. Despite that however, each party contended that the disclosure given by the other was deficient in various respects and invited us to draw inferences adverse to the ‘disclosing party’ from such alleged deficiencies.

16) While it is correct that the absence of certain documents or categories of documents was surprising, we reject any suggestion that we should draw inferences against either party from the fact that documents were ‘missing’:
    a) During the course of the proceedings the EFL made a Disclosure Application against the Club. An Order was made for the Club to provide certain documentation and to provide witness statements confirming the searches that had been made for relevant documentation and that all documentation relevant to certain issues located by such searches had been provided. The Club provided such documents and witness statements and we are satisfied that, where relevant documents exist, the Club disclosed them;"

Ultimately, the LAP did not explicitly overturn the original DC's finding on that matter, so the original DC's findings will be what they rule upon.

Everyone welcome the newest Derby County manager: Ted Lasso

6 minutes ago, MackworthRamIsGod said:

Could this have anything to do with DC Uniteds owners, whoever they are? Rooney was there for a while a their star man, he may have been able to sell us to them.

 

Probably not. The main guys in DC's ownership are also the main guys in Swansea's, so that would mean they couldn't also own us.

What are everyone's predictions as to how this next takeover attempt collapses?

4 minutes ago, r_wilcockson said:

What's the title of the next takeover thread going to be? Been waiting to find out since they announced Alonso. 

Duhr-by Rams Soccer Franchise

4 minutes ago, Cisse said:

Really?

Yep
I also reckon the away kit won't be white

Just now, Cisse said:

Usually at this time of the year there are several threads about our next season kit and other clubs too. Now the site is just about we being in a mess.

We need a kit for the next horrible season. Any suggestions?

I reckon it will be mostly white

30 minutes ago, RandomAccessMemory said:

Just spotted this tweet from Alan Nixon, it appears he has a copy of the decision report. I wonder how he has that as they've not released it yet?

So, it appears it was the second particular, and that ONLY which the EFL won on appeal.

I don't understand how it can be impermissible to take into account the possible resale value of players when it clearly states in FRS 102, as mentioned in the original decision, that future economic benefits from the intangible asset include use OR disposal?

From the original report

So if it wasn't an unreliable pattern for the years under scrutiny, why do we have to use the straight-line method?

If we don't have to use the straight-line method, given the expected consumption of future economic benefits includes disposal, it shouldn't be impermissible to take into account the resale value, and it being the 'cost model' should make no difference.

It's confused me greatly. It's why I'm wondering if the club's method can still be used but only based upon usage and not on resale. I'm not sure what that would look like, though.

Referring to the original panel's conclusions, it seems the second particular will have only been partially ruled in the EFL's favour:
"i) the fact that the Club’s amortisation policy during the relevant financial years did not amortise on straight line basis is not contrary to FRS 102" - Still true. Not using a straight line method is not, in itself, a breach of FRS 102.

"ii) the amortisation schedule does reflect the Club’s expected pattern of consumption of future economic benefits from players’ registrations" - The appeal panel finds this inaccurate, but one would assume that there would be a substantial amount of mitigation in punishment seeing as, like you said, it seems the club, the auditors, the auditor's regulators, and the panel themselves all thought that it did do so.

It will be interesting to see if the club are forced to move to a straight line method, or if they'll be allowed to use their current method solely based around "use" and not "disposal."

Having looked over the original decision again, it seems that the appeal relates to the original panel's decisions as laid out in sections 250-254. This relates to what the term "future economic benefits" means in relation to an intangible asset. The original panel found that this consisted of both the "use" of an asset and it's "disposal" i.e. how much the club expected to sell a player for. The EFL believed, and (rightly or wrongly) in the second panel's opinion were right to believe, that "future economic benefits" referred only to the benefits a club received while the club made "use" of a player's registration, and that his potential future resale value could not be included. 

https://www.dcfc.co.uk/media/get/EFL Derby County Decision Document.pdf

I find this interesting. The original decision does not go into detail as to how the club decides upon the "consumption of future economic benefits" of a player, but do mention they do so "reliably" under the panel's assumption that this refers to both the "use" and "disposal" of an asset. Is it therefore potentially the case that the club could still "reliably" determine the "consumption of future economic benefits" purely based upon the player's "use" even if their "disposal" is not considered? If so, could the club still use a non-straight line method of amortisation under these circumstances?

If anyone is interested about FRS 102, here's all 404 pages of it:
https://www.frc.org.uk/getattachment/69f7d814-c806-4ccc-b451-aba50d6e8de2/FRS-102-FRS-applicable-in-the-UK-and-Republic-of-Ireland-(March-2018).pdf

Have fun!

4 minutes ago, Norman said:

That and criticising the TV deal, wanting our own Rams TV service that wasn't part of the EFL streaming service so we could choose our own prices etc. 

Hasn't Mel gone on record that he feels the EFL have a personal agenda against him? 

In the original hearing:
"We heard factual evidence on behalf of the Club by:
  a) Mel Morris. Mr Morris has throughout the relevant period been the owner and Chairman of the Club. He gave evidence about his purchase of Pride Park from the Club and the background to that sale. His witness statement also contained a considerable amount of evidence about the Club’s wider relationship with the EFL – a relationship which he characterises as
    i) Involving ‘dislike’ of him and the Club by the EFL
    ii) Him being an ‘enemy of the EFL state’, and
    iii) The EFL having an ‘axe to grind against [him] personally'"

3 minutes ago, Reggie Greenwood said:

It’s fact but wasn’t against the rules at the time ( would be now as EFL changed this after ) just like selling the stadium to yourself isn’t. It’s just “creative “ . Just makes Gibson a hypocrite in my eyes happy to use the ( lack of )  rules for himself but cry when someone else has the temerity to do it. If I was him I’d be bollocking my financial guys for not thinking of it themselves. 
Not having a go at you @Pearl Ram at all just pointing out that a lot of other clubs have been “creative “ as you put it not just DCFC .

Hope that makes sense COYR 

 

Even with this specific EFL case, it was recognised by the EFL's own witness that, while our method is in their view "unique", we are not the only club to use a non-straight-line method of amortisation, but for whatever reason the EFL don't have an issue with other clubs' "creativity" in their amortisation policies.

38 minutes ago, MackworthRamIsGod said:

He clearly likes the sound of his own voice and is clearly making a name for himself out of this.

The crazy thing is, he openly admitted he was the one who wrote to the EFL and flagged up our accounting practices. The EFL dismissed his concerns and Maguire wrote back again and insisted they looked into it.

Derby fans and the media should be blocking him out best they can, he is not on our side in the slightest.

It has to be said, though, that him ratting on us might ultimately be in our favour. He said he wrote to them in June 2018. The EFL didn't raise any concerns about this until they charged us in January 2020. The EFL accepted accounts using the unusual amortisation method between those dates. The EFL having knowledge of the amortisation method at such an early date but doing nothing about it may be an argument to reduce any potential punishment that the committee chooses to hand down.

10 minutes ago, Sparkle said:

the most interesting thing is the fact that Middlesbrough football club appear to have been running this case and appeal process in a much more contributory way than has been previously exposed and personally I had no gripe against such a meaningless irrelevant football club but they are now a very marked card for all the other football clubs in our country.

Middlesbrough tried to muscle their way in, but were refused by the commission. They ultimately didn't contribute to the case, and only ended up wasting a lot of time and effort for all involved.
https://www.efl.com/contentassets/c9fc5dceaa7f4b62b81dca0b9e2f7c9d/2020.10.26---decision-on-mfc-redaction.pdf

Sod them for trying, though.

1 minute ago, BucksRam said:

If memory serves this is far, far less than the likes of Wednesday, Birmingham and others who were all found more guilty of deceit and miss-management than us.  Anything more would smack of a witch hunt and massively disproportionate vindictiveness based on what I've read. 

In Birmingham's case, they broke the P&S rules by overspending, and admitted straight away to having knowingly done so. It was a rule break that they knowingly made, but thought the punishment was worth taking. Seeing as they've not been relegated since, it seems to have been the smart call on their part.

In Wednesday's case, the biggest factor in their punishment was the timeline that decisions were made by the club. Effectively, at the time of the end of the financial window, the club believed that they had broken the spending rules. The stadium sale was actioned after the window had closed, and retroactively applied to the window. Their punishment was applied because the stadium sale was made to "undo" an overspend that they had already anticipated. I believe their panel found that they had been misinformed by the EFL, but it was ultimately irrelevant, because had the EFL informed them correctly prior to the stadium sale, it wouldn't have made a difference: Wednesday would have already have made the financial breach, and they would not have been able to have taken alternative measures to correct this. This resulted in the club having no punishment for misconduct, solely for the overspend.

If it is the case that the original panel still believes the club acted honestly and in good faith, I would be very surprised to see a particularly substantial punishment handed down by them.

1 hour ago, Bubbles said:

 

 

I've been open minded on Erik so far, but this has tipped me over the edge to being against him. The Matt Southall links, the Indonesian links, the Vox links, the allegations of a lack of money, I could look past them, but there's absolutely no way I want our club ran by someone that uses TikTok.

I've been reading back over the original ruling to try and get my head around all this again, and I was wondering if it's even the case that the club have been charged with overspending or if the charge is purely about the submission of accounts.

The original ruling lays out the EFL's contention as follows:
"The Second Charge relates to the approach to amortisation of the capitalised costs of player registrations adopted by the Club in its financial statements for the years ended 30 June 2016, 30 June 2017 and 30 June 2018. In essence the EFL contends:
    a) That the approach to amortisation of capitalised costs of player registrations adopted by the Club in those financial statements did not comply with FRS 102;
    b) That as a result, the ‘Annual Accounts’ submitted by the Club for those years were not (as is required by the P&S Rules) ‘prepared … in accordance with all legal and regulatory requirements applicable to accounts prepared pursuant to section 394 of [the Companies Act 2006]’, and
    c) That the consequent submission by the Club of non-compliant Annual Accounts for those years placed the Club in breach of the P&S Rules."

Reading through the P&S rules in full shows that the "overspending" rules only make up part of the P&S rules (sections 2.6-2.9). The P&S rules also contains rules relating to the submission of accounts, effectively stating that they should be accurate, conform to accounting standard, and should be submitted on time. Is it possible that the EFL's issue might not be that the club have overspent, but solely that they believe the accounts are inaccurate? 

I ask this, because I read through the procedural defences for the second charge, which I only skimmed through the first time I read the report, and noticed that they don't discuss the "overspending" section of the P&S rules.

For example, the fifth procedural defence suggests that the EFL are only pursuing a charge for breach of P&S rule 2.2, which relates solely to the submission of annual accounts:
"The Club also contends that a further legitimate expectation on its part arose out of the Sanctioning Guidelines issued as ‘a statement of the maximum sanction the EFL Executive will seek in cases of breach of the P&S Rules’. In essence the Club’s case is that
    a) The Sanctioning Guidelines provide only for the EFL Executive to seek sanctions where a club’s Adjusted Earnings Before Tax exceed the ULT, and make no provision for the EFL Executive to seek sanctions for an alleged breach of P&S Rule 2.2
    b) The Sanctioning Guidelines are thus a representation, meeting the MFK test, that the EFL will not seek sanctions otherwise than where a club’s Adjusted Earnings Before Tax exceed the ULT 105
    c) Fairness requires the EFL to be kept that representation."

This argument was dismissed, but the essence of this section is the club's suggestion that they shouldn't have been charged as the P&S rules only allow for disciplinary procedures against clubs that overspend, not for any other P&S rule breaches. The panel ruled that this wasn't the case. This would suggest, though, that the alleged P&S rule breaches do not relate to an overspend, but solely issues with the submission of annual accounts.

Furthermore, P&S Rule 2.9, the rule that relates to "overspending", is only mentioned once in the second charge section of the document, mentioned in the sixth procedural defence only as a charge that the EFL might hypothetically bring:
"To invite the Club to address it on such matters makes these proceedings an abuse of process. Such matters, it is said, demonstrate that the real purpose behind the Second Charge was as a fishing expedition, to investigate whether there might be grounds for:
    iv) Initiating disciplinary proceedings against the Club for a further breach of P&S Rule 2.9."

So, with this in mind, is it the case that the charge isn't related to the club overspending, but purely related to submitting allegedly inaccurate or unsuitable accounts? If so, does anyone know what this would mean in terms of punishments?

8 minutes ago, angieram said:

 

It's a really important goal as well, because Serie A uses head-to-head goal difference as first tie break ahead of goal difference across all games. That goal takes the advantage away from Juventus and gives it to Milan, so if they finish on the same points, Milan finishes ahead of them. Could be vital for the Champions League spots come season's end.

1 minute ago, CornwallRam said:

Why would the EFL appeal 2.5? That's the bit were found 'guilty' of. We could have appealed that just to fully clear our name (although a pretty pointless distraction), but not the EFL. 

I've never heard of the prosecution appealing a guilty verdict.

They have appealed decisions previously where they thought that the punishment was too light. As we only really got a talking to for 2.5, it's possible that that's the case here, but I do think it's more likely that it's the entirety of the second charge.

One for the fan club:

5 hours ago, GenBr said:

Not everything the Daily Mail writes is false. 

But I agree Mel couldn't possibly have chosen another chancer to take over the club. I refuse to believe such an outlandish story and I'm sure our Spanish friend has already passed the fit and proper persons test.

 

"Fool me once, shame on you. Fool me twice, shame on me. Fool me three times, shame on both of us." Stephen King

"Fool me once, shame on...shame on you. Fool me—you can't get fooled again."  George W. Bush

I don't understand how this would mean the deal is dead. Isn't this basically the same thing that the Glazers did at Man Utd and Burnley's new owners have done to finance their takeover?

It's going to be a real Sophie's Choice moment deciding whether I'll be rooting for Mount or Carson in the final.

1 hour ago, Wolfie20 said:

Scott Carson looks like he'll be in a Champions League final squad - who'd have thought eh?

For the second time!
I
If Man City win, I'm definitely claiming this as a Derby County Champions League victory