Potential Leicester City collapse..

[ramblur]

Seems pretty calculated approach from their board/directors/whoever runs the show there. All of those contracts ending before FFP can't be coincidence. Different and more costful approach than ours, hope it's not so good.

 

If we both go up, I'd say they would be in better position than us. No dead wood to get rid of, just offer contract to those are good enough in PL.

FFP bites on this season's results,with sanctions (to non promoted clubs) in the form of transfer embargo being applied from 1/1/2015,so the Leicester contracts don't end before FFP,but during it.

 

As it seems fairly obvious that they will likely be over the FFP limit for 13/14,they're no doubt taking the stance that the financial FFP hit following promotion would be a minor irritation.However,failure to win promotion with contracts running out and a likely transfer embargo would make things very interesting.

 

There may be one saving grace,as I seem to remember the FFP regulations stated that the embargo stayed in place until the result came within limits,or until such time as the club could demonstrate that they were complying.As it would almost certainly be wages more than anything else that would push Leicester over the FFP limit,a raft of contracts dropping out would give the opportunity to drastically prune the wage bill and demonstrate compliance to the League.

[jagerbob]

Wasnt there a piece in the leicester mercury recently (linked in this forum) where their owners will wipe out all the debt and thus make a mockery of the FFP yet again from Leicesters point of view?

 

Lets not forget when Linekar was part of a consortium which got them out of administration, before the rules about points deductions came in.. they had all their debt cleared then too!

[TroyDyer]

You can only dodge the sword for so long. They've been poorly run for years. Only a matter of time before it goes Pete Tong.

[ramblur]

Wasnt there a piece in the leicester mercury recently (linked in this forum) where their owners will wipe out all the debt and thus make a mockery of the FFP yet again from Leicesters point of view?

 

Lets not forget when Linekar was part of a consortium which got them out of administration, before the rules about points deductions came in.. they had all their debt cleared then too!

The FFP result doesn't relate to debt,but profit/loss result.The only influence debt would have on the result would be via debt charges (interest).

I didn't see the article you quote,but if the Leicester owners had cleared debt by the injection of share capital, thus clearing debt charges from their FFP result,then you could argue that FFP would have had a positive influence on Leicester's affairs.

 

I think fans in general are getting a bit carried away with ways they think clubs might circumvent the regulations-it's not that easy at all.Even if a club came up with a big ground naming sponsorship with all the cash paid up front,for the purposes of the P/L account (and hence FFP) ,only the proportion relating to the year in question would be credited (the rest going against deferred income).I'm also sure that the League would be monitoring these kind of things to ensure figures are reasonable,and not 'fiddles'.

[ramblur]

You can only dodge the sword for so long. They've been poorly run for years. Only a matter of time before it goes Pete Tong.

If they were to go up this year,the massive rewards would mean their approach would have been vindicated.Even if they didn't,there's always the possible prospect of a legal challenge.If this happened and they continued spending without the ultimate success,then you'd be quite right to point out the **** would hit the fan eventually.

[eddie]

If they were to go up this year,the massive rewards would mean their approach would have been vindicated.Even if they didn't,there's always the possible prospect of a legal challenge.If this happened and they continued spending without the ultimate success,then you'd be quite right to point out the **** would hit the fan eventually.

 

The other possibility is that the fan gets switched off.

[TroyDyer]

If they were to go up this year,the massive rewards would mean their approach would have been vindicated.Even if they didn't,there's always the possible prospect of a legal challenge.If this happened and they continued spending without the ultimate success,then you'd be quite right to point out the **** would hit the fan eventually.

 

I just can't see them as a mid table, steady PL club. Even if they get promoted, I can see them lasting a season and coming down with a bump.

[ramblur]

The other possibility is that the fan gets switched off.

and relocates.

[TroyDyer]

and relocates.

 

Coalville Foxes?

[pej1956]

The FFP result doesn't relate to debt,but profit/loss result.The only influence debt would have on the result would be via debt charges (interest).

I didn't see the article you quote,but if the Leicester owners had cleared debt by the injection of share capital, thus clearing debt charges from their FFP result,then you could argue that FFP would have had a positive influence on Leicester's affairs.

 

I think fans in general are getting a bit carried away with ways they think clubs might circumvent the regulations-it's not that easy at all.Even if a club came up with a big ground naming sponsorship with all the cash paid up front,for the purposes of the P/L account (and hence FFP) ,only the proportion relating to the year in question would be credited (the rest going against deferred income).I'm also sure that the League would be monitoring these kind of things to ensure figures are reasonable,and not 'fiddles'.

I for one am not that clear on the FFP impact. This helps a bit. Thanks Ramblur

[ramblur]

I just can't see them as a mid table, steady PL club. Even if they get promoted, I can see them lasting a season and coming down with a bump.

Maybe so,but you have to remember that even in our Prem season we turned a headline profit (after hefty paper transactions) and generated a £14m cash surplus on operations.Prem season rewards these days dwarf what we got in 2008,meaning more could be spent,yet still producing a better financial result.If they were relegated,then they would have the benefit of 4 years of hefty chute payments to augment their FFP results (the reason why FFP can never be fair).

[TroyDyer]

Maybe so,but you have to remember that even in our Prem season we turned a headline profit (after hefty paper transactions) and generated a £14m cash surplus on operations.Prem season rewards these days dwarf what we got in 2008,meaning more could be spent,yet still producing a better financial result.If they were relegated,then they would have the benefit of 4 years of hefty chute payments to augment their FFP results (the reason why FFP can never be fair).

Can't you just let me enjoy the idea of them going to the wall? Stop prodding me with these silly things called facts.

[jagerbob]

Ok you win.... maybe it doesnt.

Pearson says as much in the article....

 

http://www.leicestermercury.co.uk/Leicester-City-debt-wiped-Nigel-Pearson-looks/story-20360955-detail/story.html

[ramblur]

I for one am not that clear on the FFP impact. This helps a bit. Thanks Ramblur

I could put up the official League link again,but I'm not sure it would help that much,as I think you probably need a bit of accounting knowledge to know what goes into P/L.

 

One interesting thing about Leicester's situation is that they could no doubt drag back their FFP result for this year by a couple of high profile sales of those in the last years of contracts.This would mean that their book values would be fairly low (almost depreciated out) and thus the selling prices would be mostly pure profit.These profits would count towards the result.

 

I said some time ago that CEOs of well run clubs should start monitoring the January windows for signs of stressed sales.Leicester's dilemma would appear to be in compliance v promotion push.As for the gumps,if they go on a spree and fail to get promotion,I can only see a legal challenge saving them.

[ramblur]

Can't you just let me enjoy the idea of them going to the wall? Stop prodding me with these silly things called facts.

Well it's a fact that if they don't get promoted you'll probably derive your enjoyment.

[pej1956]

I could put up the official League link again,but I'm not sure it would help that much,as I think you probably need a bit of accounting knowledge to know what goes into P/L.

 

One interesting thing about Leicester's situation is that they could no doubt drag back their FFP result for this year by a couple of high profile sales of those in the last years of contracts.This would mean that their book values would be fairly low (almost depreciated out) and thus the selling prices would be mostly pure profit.These profits would count towards the result.

 

I said some time ago that CEOs of well run clubs should start monitoring the January windows for signs of stressed sales.Leicester's dilemma would appear to be in compliance v promotion push.As for the gumps,if they go on a spree and fail to get promotion,I can only see a legal challenge saving them.

That's such good news for me residing in Coalville! How are DCFC doing in these stake Ramblur?

[TroyDyer]

Well it's a fact that if they don't get promoted you'll probably derive your enjoyment.

 

 

Merry Christmas Ramblur. 

[ramblur]

Ok you win.... maybe it doesnt.

Pearson says as much in the article....

 

http://www.leicestermercury.co.uk/Leicester-City-debt-wiped-Nigel-Pearson-looks/story-20360955-detail/story.html

I take it that Pearson's comment about not knowing what the repercussions are means that he doesn't know which league they'll be in next year,as the actual repercussions are well known- fines for promoted clubs and transfer embargos for the rest.The debt/equity switch does tend to indicate a long term approach.

[ramblur]

That's such good news for me residing in Coalville! How are DCFC doing in these stake Ramblur?

Very well,but it all depends on whether they're angling to lose just the acceptable deviation,without further losses which would need a matching capital injection.If this were the case,I could see a player sale in January,although Chelsea proceeds would help.A victory and juicy tie in next round (or Chelsea replay) might make the calculation a bit more interesting.We'll probably have a better idea of the lie of the land in a couple of weeks time. 

[ramblur]

Merry Christmas Ramblur. 

I extended season's greetings to all in another thread.My own merriment was curtailed a little by Paterson (always rated him and thought the pesk would score) and the gumps,offset a little by QPR spike.