EFL appeal

[G STAR RAM]

5 minutes ago, DCFC27 said:

It was a time whereby Derby stayed out of the headlines unless it was for the right reasons.

They are the type of custodians you want for your club. 
I remember the protests, but they were in the season following relegation from the premier league and maybe a little the following season. Ultimately responsible owners that built the club that Mel took over. 

But that is not what you said.

Out of interest how were they going to pay off the £15m mortgage when it fell due?

And who was going to fund the annual losses?

People seem to have a very hazy memory about this period but the voices against these being the kind of custodians we wanted for our club were growing louder by the day.

Would GSE have kept the 2013/14 squad together? I have my doubts.

[NottsRam77]

27 minutes ago, Indy said:

This bit confuses me. So the arbitration panel (with no accountancy expertise) rules that the commission (which includes an accountant) was wrong on a point of accountancy legality. And that is referred back to the commission (including the accountant) who went into a fair amount of detail about why accountancy law wasn’t broken, to decide on a punishment. Makes no sense. 

Does this mean it’s highly unlikely we’ll face anything significant 

[JfR]

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.

[RadioactiveWaste]

3 minutes ago, LE_Ram said:

You can allocate a residual value to an intangible asset under FRS102, provided that:

- There is a commitment by a third party to buy it at the end of its useful life, OR

- There is an active market for the asset, and its residual value can be determined by reference to the market, and the market will exist at the end of the asset's useful life.

 

So it looks like Derby are saying - there's clearly an active market for players, and we buy players with the expectation of selling them at the end of their contracts, so it's not fair to allocate a RV of nil because that's ultimately not representative of the true situation. But the EFL says, well at the end of the contract, the player can leave on a free, so you need to amortise down to a RV of nil.

Without looking at the detail for each player it's tough, because some players (probably someone like Jozwiak), DCFC will expect to sell before his contract is up, and so will have some sort of RV; but some like CKR will probably not be sold and should be amortised down to nil value.

There's ultimately a lot of judgment around it because the RV should be set at the amount that Derby will eventually get for the player - who knows how much we'll sell Joz for in a few years, there are so many factors. But in terms of whether it's allowable under FRS102 to allocate a non-nil residual value to an intangible, yes it is.

I thought we wrote the value down to 0 at the end of the contract the same as the straight line method because at the end of the contract they do not have a value to club, the issue was how much we said their contract was worth in between the start and end points?

Effectivly, the EFL argument is that this cannot be know, so the only viable option is to writ it down evenly over the course of the contract (it is impossible to justify anything else), DCFC's argument is, yes, you can based on how good they are and what other similar players transfer for. It's harder to justify from the DCFC side, but the orginal hearing dtermined that we did that.

[Ghost of Clough]

1 minute ago, RadioactiveWaste said:

I thought we wrote the value down to 0 at the end of the contract the same as the straight line method because at the end of the contract they do not have a value to club, the issue was how much we said their contract was worth in between the start and end points?

Effectivly, the EFL argument is that this cannot be know, so the only viable option is to writ it down evenly over the course of the contract (it is impossible to justify anything else), DCFC's argument is, yes, you can based on how good they are and what other similar players transfer for. It's harder to justify from the DCFC side, but the orginal hearing dtermined that we did that.

A value (ERV) is assigned to a player for the start of the final season. It is then a straight line from when they sign to that ERV. the remaining amount is amortised in the final season. Contract extensions mean setting a new ERV and adjust the straight line to suit (current period in time to ERV)

[Ibby]

[StarterForTen]

I've said this before but straight-line amortisation is not appropriate for intangible assets like players' contracts; it skews true balance sheet value.

Buy player X as a promising 21 year old from Man United's reserves for £4m on a four year contract; said Player X signs a new contract in the third year of his stint with a book value of £1m, shortly before being called up for his country and is now worth considerably more.

Any FFP protocol has to allow for gains as well as losses, otherwise it's just a stick to beat clubs with.

Edited May 11, 2021 by StarterForTen

[therams69]

42 minutes ago, G STAR RAM said:

Has he come out since them 3 months and said he is not prepared to continue funding the club until we find a buyer? If not, isnt it safe to assume that his statement stil stands?

I dont think it is G Star if being honest.

3 months ago Derby County was very different.

So its safe to say things have changed over this time. However, an end of season update would be welcome though offering assurance. Even more so now considering we have sinked another 2.3m through bad management. 

[Spanish]

6 minutes ago, RadioactiveWaste said:

I thought we wrote the value down to 0 at the end of the contract the same as the straight line method because at the end of the contract they do not have a value to club, the issue was how much we said their contract was worth in between the start and end points?

Effectivly, the EFL argument is that this cannot be know, so the only viable option is to writ it down evenly over the course of the contract (it is impossible to justify anything else), DCFC's argument is, yes, you can based on how good they are and what other similar players transfer for. It's harder to justify from the DCFC side, but the orginal hearing dtermined that we did that.

the limited wording indicates that straight line is not the only option, it focuses on the ERV

More specifically, the panel determined that the Club’s policy was not in accordance with accounting standard FRS102 because it failed to accurately reflect the manner in which the Club takes the benefit of player registrations over the lifetime of a player’s contract.

[Indy]

6 minutes ago, NottsRam77 said:

Does this mean it’s highly unlikely we’ll face anything significant 

That would be my assumption. Otherwise it would mean a panel with accountancy expertise, adjudicating on accounts that have been cleared by auditors, would give priority over their own expertise and that of auditors, to a new panel with zero accountancy expertise. That’s why I think this makes no sense. To levy a large punishment (or any punishment really) would mean accepting that their original ruling was incorrect as determined by non-experts. 

[G STAR RAM]

1 minute ago, therams69 said:

I dont think it is G Star if being honest.

3 months ago Derby County was very different.

So its safe to say things have changed over this time. However, an end of season update would be welcome though offering assurance. Even more so now considering we have sinked another 2.3m through bad management. 

One of our players getting pissed up, injuring himself and rendering himself useless is bad management? How?

[Spanish]

8 minutes ago, Ghost of Clough said:

A value (ERV) is assigned to a player for the start of the final season. It is then a straight line from when they sign to that ERV. the remaining amount is amortised in the final season. Contract extensions mean setting a new ERV and adjust the straight line to suit (current period in time to ERV)

c) Subsequently, at 6 monthly intervals, the Club i)Would consider how the Club expected to ‘consume the asset’s future economic benefits [i.e. the future economic benefits of the player’s registration] having regard to external factors’ over the remainder of the player’s contract – in particular (1) For how long the Club might benefit from the use of the player’s registration and so from the provision of services to it by the player – for example, by reason of the player playing matches for the Club (2) Whether it was expected that the player’s registration would be disposed of (i.e. sold) to another club before the expiry of the player’s contract (and if so, when) ii) Would consider what sum, if any, each player in its squad could be expected to generate if that player’s registration was ‘disposed of’ i.e. if the player’s registration was to be sold by the Club at a time before the expiry of the player’s contract with the Club, and so before he became a Bosman free-agent able to join a new club without that new club having to pay anything to the Club for his player registration:

 

so it would appear that the ERV could be adjusted every 6 months

[SaintRam]

I find it a little bit disingenuous, although I suppose technically correct (maybe?), that this is being reported as the "EFL winning their appeal" when we've been found guilty of one sub-section of one charge out of about a dozen charges that were brought to the table originally.

There's still people out there that think this is about the stadium.

I find it really hard to imagine how the charge we've been found guilty of could lead to a points deduction - especially as we've been under a transfer embargo for, as far as we know, the entire time this has been under investigation. That seems like the punishment has already been dealt to a degree?

[Spanish]

9 minutes ago, StarterForTen said:

I've said this before but straight-line amortisation is not appropriate for intangible assets like players' contracts; it skews true balance sheet value.

Buy player X as a promising 21 year old from Man United's reserves for £4m on a four year contract; said Player X signs a new contract in the third year of his stint with a book value of £1m, shortly before being called up for his country and is now worth considerably more.

Any FFP protocol has to allow for gains as well as losses, otherwise it's just a stick to beat clubs with.

I agree partially, but it could tempt clubs with a borderline breach to be a little more generous with the ERV.  Lets be honest we dont of recent times have much success in getting any economic value from our departees

[Spanish]

1 minute ago, SaintRam said:

I find it a little bit disingenuous, although I suppose technically correct (maybe?), that this is being reported as the "EFL winning their appeal" when we've been found guilty of one sub-section of one charge out of about a dozen charges that were brought to the table originally.

There's still people out there that think this is about the stadium.

I find it really hard to imagine how the charge we've been found guilty of could lead to a points deduction - especially as we've been under a transfer embargo for, as far as we know, the entire time this has been under investigation. That seems like the punishment has already been dealt to a degree?

we've already been found guilty of 2e. 2A not guilty.  

Likely 2b not guilty

likely 2c and 2d guilty

So possibly 3/5 of charge 2

[The Scarlet Pimpernel]

30 minutes ago, LE_Ram said:

You can allocate a residual value to an intangible asset under FRS102, provided that:

- There is a commitment by a third party to buy it at the end of its useful life, OR

- There is an active market for the asset, and its residual value can be determined by reference to the market, and the market will exist at the end of the asset's useful life.

 

So it looks like Derby are saying - there's clearly an active market for players, and we buy players with the expectation of selling them at the end of their contracts, so it's not fair to allocate a RV of nil because that's ultimately not representative of the true situation. But the EFL says, well at the end of the contract, the player can leave on a free, so you need to amortise down to a RV of nil.

Without looking at the detail for each player it's tough, because some players (probably someone like Jozwiak), DCFC will expect to sell before his contract is up, and so will have some sort of RV; but some like CKR will probably not be sold and should be amortised down to nil value.

There's ultimately a lot of judgment around it because the RV should be set at the amount that Derby will eventually get for the player - who knows how much we'll sell Joz for in a few years, there are so many factors. But in terms of whether it's allowable under FRS102 to allocate a non-nil residual value to an intangible, yes it is.

And that is all we need to know. The EFL say otherwise and have been backed up by the three (non accountancy qualified) judges. Its a disgraceful face saving exercise. On a positive note I am absolutely delighted it goes back to the original panel to decide on an appropriate sanction as originally they didn't think we deserved anything.  Slap on wrist incoming!!

Edited May 11, 2021 by The Scarlet Pimpernel

[Jimbo Ram]

17 minutes ago, G STAR RAM said:

One of our players getting pissed up, injuring himself and rendering himself useless is bad management? How?

Question is, is getting in to a car when drunk, but not driving, a sackable offence? Seems like it is not. I always thought the punishments were the wrong way around right from the start. Mason and Tom are the ones who should have been sacked and Keogh suspended....

[Spanish]

4 minutes ago, The Scarlet Pimpernel said:

And that is all we need to know. The EFL say otherwise and have been backed up by the three (non accountancy qualified) judges. Its a disgraceful face saving exercise. On a positive note I am absolutely delighted it goes back to the original panel to decide on an appropriate sanction as originally they didn't think we deserved anything.  Slap on wrist incoming!!

which can be appealed, the way this is going we might get the penalty will into next season if there is one

[Spanish]

1 minute ago, Jimbo Ram said:

Question is, is getting in to a car when drunk, but not driving, a sackable offence? Seems like it is not. I always thought the punishments were the wrong way around right from the start. Mason and Tom are the ones who should have been sacked and Keogh suspended....

could they work after?

could Keo?

 

[kevinhectoring]

57 minutes ago, Jortat said:

Rooney spits constantly on the touch line so what is his excuse ? It’s just a habit that players do imo , no scientific  answer required.

He produces bucketloads of the stuff it’s completely unnatural. He’s chewing something pretty powerful