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Where Has The Money Gone?


Ram of Steel

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Just my take on the money side ... I don't think we are as bad off as people are thinking. Yes we need to cut back on the wage bill to make it more sustainable. But I can't see us selling all out top assets and not spending at all.

maybe Mel's just fed up of other clubs milking us and he's spreading the rumours we are skint to ensure we're not taken to the cleaners again.

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7 minutes ago, RoyMac5 said:

Hey @ramblur all this worry about this years FFP and this:

What's the worst that could happen do you think? How big a fine for going over one year?

I’m pretty confident the clubs finances are in good hands, I don’t think we will put ourself at risk of penalties.

Hence why they came up with the unique way of accounting for depreciation. And if you read that article stripping the academy out of the numbers to mask those losses.

I do think we will see more decisions led by ffp though not whether the money is there (or in mels bank account). People argued the wassall caretaker role was like this, Gary and his one in one out policy etc.

Extending contracts and keeping players to wind down the depreciation could happen though. I look at e.g. Bradley Johnson. A big earner on the fringes who’s stock has dropped, normally you’d let go at the end of the contract. No one will offer him a contract like he is apparently on now, so would we try and half or more his money to drag out that apparent 6 mill fee and keep him for depth? No idea

I wouldn’t be surprised if they have learnt the lesson to see us actually paying decent fees... just on young players e.g from abroad/lower divisions who will not take a massive hit in value. 

People like Maddison from Peterborough at 3/4 million. If they have a good season and prove their worth can be worth 6/8 or if they have an incredible season the figures we have seen spoked for Vydra.

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48 minutes ago, DontTrustTheDevilInside said:

If anyone read the article shared on here about our accounts it tells a story. 

Massive wages and long contracts is huge but the big thing most people are missing is player fees.

Because we are the only club to write off fees in a weird way (not the length of the contract) it’s highly likely even players like Shackell, Butterfield (if we are lucky enough to get rid) and Blackman (likewise) will cost us a lot this year from our ffp.

Essentially if that article is correct when we sell them it will be a disposal of an asset that has depreciated far quickly than expected. Result= a massive loss in the accounts.

I wouldn’t be surprised to see some odd contract renewals to stall the pain of this hitting the accounts. The worry is if the players know they will push heavy for a new contract knowing the club aren’t in a position to negotiate.

Just when fans couldn’t be more bemused by the club signing players way past their prime...

Shackell was out of contract at the end of 17/18, whereas the other 2 you mention will be out of contract at the end of 18/19. I'd be very surprised if Shackell hadn't only been given a very nominal (or no) residual value, meaning that his reg (+agent's fees& League levy) will have been amortised out. I've written several times about the possible problems in respect of Butters/ Bradders/Nick , but some recent analysis at least shows a possibility that the former 2 were given residual values greater than Zero.

Amortisation rose to £5.041m in 16/17, a rise of £1.671m on the year before, and possibly an indication that both Anya and Nugent were given low( if any) residual values , due to their ages. It therefore appears that older players are being amortised more in line with the way we used to do things.

I'm told that financial regs dictate the way we treat intangibles, and that it's the other clubs that are out of line with regulatory requirements.

I'd be very surprised if there were contract renewals just to pay more wages we didn't need to pay and merely push the problem on a year or two.

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1 hour ago, RoyMac5 said:

Hey @ramblur all this worry about this years FFP and this:

What's the worst that could happen do you think? How big a fine for going over one year?

FFP is based on a 3 year cycle, so it's not really a case of going over in any 1 year. As I've tried to point out in the past, because the 16/17 result looks like a £2m loss, we'd have a total of £37m to play with for 17/18 and 18/19 combined, so you can forget about any fines for the 16/17, 17/18, 18/19 cycle. 

However, what we post up in those 2 years will affect the maximum loss we could make in 19/20, so that's where we have to be a bit careful.

I didn't even know that fines applied to clubs that weren't promoted, but if this were to be the case, then I assume it would be based on the same method used for promoted clubs ( which I can't remember).

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1 hour ago, DontTrustTheDevilInside said:

 

Hence why they came up with the unique way of accounting for depreciation. And if you read that article stripping the academy out of the numbers to mask those losses.

.

The Academy figures were included in the Club's results. I pointed out several errors 'The Baron' had made. When he came onto the forum he made no attempt to dispute what I'd said, but said something along the lines of it was good to learn. The last time I looked, no alterations had been made to his article ( not that I expected any - if he admitted to mistakes there, then viewers might wonder about his other work).

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On 22/05/2018 at 22:36, ronnieronalde said:

The wages alone have gone from less than ten million in 2013 to thirty five million last season.

Where has the money gone? Probably an extra 60-75 million over five years?

 

23 hours ago, ramblur said:

You're comparing a players' wage bill ( though I'd put it at less than £9m) to a total wage bill there Ronnie, but the essence of your point is still valid. I always used to work on the basis of 'other' wages being £3m-£4m in the Clough days, but now I haven't got a clue. Whilst general commercial (and possibly catering) revenues have risen impressively, you never see the cost of this. We may have expanded certain staffs, and there's also the possibility that performance related bonuses may have been paid. We'll start to see RamsTV revenues hit the accounts, but we won't be able to identify the associated wage costs.

13/14 - £16.4m

14/15 - £21.8m

15/16 - £33.1m

16/17 - £34.6m

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3 minutes ago, Ghost of Clough said:

 

13/14 - £16.4m

14/15 - £21.8m

15/16 - £33.1m

16/17 - £34.6m

I assumed Ronnie was talking about Nigel's last full year (12/13) when total wages were £12m.

I reckon Nigel's dealings in the following year's Summer window had possibly brought the wage bill down further, so you can see the hop when Mac landed.

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9 minutes ago, ramblur said:

I assumed Ronnie was talking about Nigel's last full year (12/13) when total wages were £12m.

I reckon Nigel's dealings in the following year's Summer window had possibly brought the wage bill down further, so you can see the hop when Mac landed.

I’m not too sure about that. We sold/released Fielding, Tyson, Roberts Robinson and Bradford. But signed Martin, Eustace, Grant, Forsyth, Russell, and Adam Smith (loan).  

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1 hour ago, Ghost of Clough said:

I’m not too sure about that. We sold/released Fielding, Tyson, Roberts Robinson and Bradford. But signed Martin, Eustace, Grant, Forsyth, Russell, and Adam Smith (loan).  

Also loaned out O'Connor,Naylor, Doyle and Atkins whilst Nigel was still here.

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On 24/05/2018 at 17:00, DontTrustTheDevilInside said:

I’m pretty confident the clubs finances are in good hands, I don’t think we will put ourself at risk of penalties.

Hence why they came up with the unique way of accounting for depreciation. And if you read that article stripping the academy out of the numbers to mask those losses.

I do think we will see more decisions led by ffp though not whether the money is there (or in mels bank account). People argued the wassall caretaker role was like this, Gary and his one in one out policy etc.

Extending contracts and keeping players to wind down the depreciation could happen though. I look at e.g. Bradley Johnson. A big earner on the fringes who’s stock has dropped, normally you’d let go at the end of the contract. No one will offer him a contract like he is apparently on now, so would we try and half or more his money to drag out that apparent 6 mill fee and keep him for depth? No idea

I wouldn’t be surprised if they have learnt the lesson to see us actually paying decent fees... just on young players e.g from abroad/lower divisions who will not take a massive hit in value. 

People like Maddison from Peterborough at 3/4 million. If they have a good season and prove their worth can be worth 6/8 or if they have an incredible season the figures we have seen spoked for Vydra.

You heard it here first.... not in the know and many questioned but the retained list shock has proven it right. Even I didn’t predict the extent but knew something like this would be a card played in ffp

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On 22/05/2018 at 22:21, Ram of Steel said:

I'm really struggling to see how we are suddenly unable to spend money because of FFP risks. Yes we've spent a considerable amount since 15/16 season but we have also commanded some relatively high transfer fees ourselves for players, most of which at a good profit. Off the top of my head - Hendrick £10m, Ince £11m, Hughes £8-9m, Christie £2.75m + Martin loan fee & Grant £1m?

I don't know a great deal about FFP, I know it works in cycles and that transfer fees are spread out over the length of the player's contract, and of course we have a high wage bill but when you consider that we will be getting high earners off of that wage bill this summer such as Bent, Shackell, Baird? And potentially Martin. Along with the potential of bringing in around £15m if we decide to sell Vydra and the further reduction in wages that will bring, then why are we suddenly unable to spend to the extent where the manager decides to leave? Worried about having to reduce the wage bill further and a lack of ambition. 

What has changed since just a few months ago when we were bidding £6m for the likes of James McClean?

WAGES, WAGES, WAGES  ..... Next question

( Brevity best when confusion reigns )

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On 22/05/2018 at 23:30, The Scarlet Pimpernel said:

Mel has been topping us up to the time if £10m per year. Probably had enough.

Yes I suspect that's the case. Mr Morris probably envisaged DCFC being the PL by now. 

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Quote

What has changed since just a few months ago when we were bidding £6m for the likes of James McClean?

Wow. Thats what you call a near miss.

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Too much money spent on wages. Mr Morris is reportedly putting in significant funds every month. In any other business this wouldn't be sustainable. Until wage caps are introduced, clubs will continue to live beyond their means, with financial disaster just around the corner. 

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