FFP and revenues (1 Viewer)

[Calista]

I confess that the financial aspects of this whole saga are completely beyond me, but much has been made of the need for the club to have “access to all revenues”, and some people refer to this as the “pie money”.

Can anyone on here clarify the Financial Fair Play rules? Can a club count ALL revenues from its stadium complex towards FFP, or only FOOTBALL-RELATED revenues?

If it’s all the revenues, and CCFC took ownership of the Ricoh and ploughed all the money from the stadium, exhibitions, concerts, casino etc. into the FOOTBALL CLUB accounts, surely we’d become one of the most financially sound clubs in the country? As a complex, the Ricoh comes with far more facilities than most football stadiums.

But if FFP only allows match-day stuff like pies, that would be peanuts (if you get my drift). The football side of things would gain very little, over and above the ticket sales we already have access to. Meanwhile, the big money from everything else would be siphoned off to the owners. In our case, that looks very much like it would simply go to the “investors” behind SISU (who say we owe them £45 million or whatever).

And what about the “land enablement” mentioned by Mr. Fisher in the recent SCG minutes – can a club use profits from developing surrounding land to feed into FFP? And even if so, would SISU be likely to do that?

This is surely the root cause of the disagreements on here, and I’d love to see some considered replies.

 

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[pw362]

Don't worry our owners told the FL that all losses would be covered whilst we play in Northampton.

 

[Astute]

All club generated revenues are to be counted. Don't mean they will be used though. If SISU sponsored our clubs shirts for 10m a season we would have 6m to spend. Then we could pay back 4m of the debt. And we would all want to buy a top with their name on

 

[skybluetony176]

All club generated revenues are to be counted. Don't mean they will be used though. If SISU sponsored our clubs shirts for 10m a season we would have 6m to spend. Then we could pay back 4m of the debt. And we would all want to buy a top with their name on

Exactly. Something that a lot of people keep missing. Which is why I'm not sure that owning our ground is the best thing for the club. If we're paying £3.2m+ a year in interest charges as apposed to £150k a year rent you don't need to be a genius to work out which one is going to leave you the most expendable income for the team.

The right rent deal could possibly be the best deal for the club but keeps being dismissed out of hand because the same people who keep telling us the stadium details are being released next week, no three weeks, no I was misquoted also tell them that every expert in the world says no club in the world could survive with a rental arrangement.

 

[Astute]

FFP don't help a club like ours. They could spend 60% of income to improve our club if we came home yet could still put our debts higher. We will be stuck as a lower Division 3 club whilst playing in Northampton. This is unless we manage to put a good academy based squad together.

 

[Calista]

All club generated revenues are to be counted.

I’m still not clear on this. If Coventry City Football Club owned the Ricoh, would they be able to use the revenue from non-football activities at the stadium (exhibitions / concerts / hotel / casino) towards the FFP calculations? If so, owning the stadium could be a massive benefit to the club (if the owners chose to put the income towards the football of course – another debate entirely).

If only FOOTBALL-related revenues count towards FFP, then as far as I can see renting is just as good.

This is crucial to the “we must own the stadium” argument. Can anyone clarify this?

 

[skybluefred]

If sisu owned the lease they would be in control of all revenue generated under that lease. However CCFC would be paying rent
to sisu for playing at the Ricoh. Also in all probability the majority of money generated would go to paying off sisu's investors,
with the Club still struggling.

This is just my reading of it--others may see it differently.

 

[skybluetony176]

If sisu owned the lease they would be in control of all revenue generated under that lease. However CCFC would be paying rent
to sisu for playing at the Ricoh. Also in all probability the majority of money generated would go to paying off sisu's investors,
with the Club still struggling.

This is just my reading of it--others may see it differently.

That's the way I see it too. Unless sisu clarify the relationship that the companies that make up the club will be with ownership of the ricoh or indeed imagination land.

I keep trying to point this out but apparently it's not important. There's a very real possibility that the club will end up being better of at the Ricoh on the original rent deal as agreed by the previous owners, there is off course the possibility of the complete opposite. Just worries me that sisu are very reluctant to tell us. Surely if we approve of the arrangement it's an easy PR win for them? They might even fill suxfields if it's clear what they're doing is in the best interest of the club.

 

[Ian1779]

FFP is not the easiest to define to be honest, but I do think there are some key points that are being overlooked here.

This is an important one - and one that is probably most salient given the nature of the dispute between the parties.

2.The distinction between non-football operations related to the club and non-football operations not related to the club

Having determined that there are non-football operations within the reporting perimeter, the Regulations draw a distinction between:

i)non-football activities/operations which are related to the activities, locations and/or brand of the football club, for which the income and expenses maybe excluded from the break -even calculation; or


ii)non-football activities/operations which are clearly and exclusively not related to the activities, locations or brand of the football club, for
which the income must be excluded from the break even calculation and the expenses may be excluded from the break-even calculation.


In general, non-football operations which are related to the locations of the football club are operations physically based at or in close
proximity to a club‟s home stadium and/or training facilities.


And, non-football operations which are related to the brand of the football club are operations clearly using the name/brand of a club as part of their operations at the location and in customer/marketing collateral.


A licensee must bear in mind the substance of the relationship between the non-football operations and the football club, including both

the current and historical relationship, the history of the legal ownership of the non-football operations, the financing of the non-football operations (whether the development of a non-football operation has been financed from the football club‟s own resources or not), and the completeness of financial reporting of the non-football operations (all expenses).

http://www.tff.org/Resources/TFF/Do...sans/UEFA-CL-FFP-IT-Solution-Toolkit-2013.pdf

This relates to UEFA's definition of what can be classed as turnover - and this applies to all clubs including us in League 1

http://www.ffw.com/pdf/Financial Fair Play in Football 2014 .pdf

This is a more recent document about FFP including the SCMP model that we operate on. Page 17 and 20 offer some interesting explanations.

1.

Other operating income: this includes operating income
not otherwise described specifically, including revenue

derived from activities such as subsidies, rent, dividends
and income from non-football operations. With clever
group structuring, a club with means may have the ability
to generate, or channel, "other revenues" into the club.

From Page 17



There is an awful lot of info there, but from what I can gleam from it that revenue/turnover can include activities that use the brand or location of the football clubs home. And this will form a big part of the SCMP calculation.

 

[ccfc92]

thought I'd post this on this thread, rather than start a new one:

Remember before Xmas, we were told SP will have money to spend, spend, spend according to JS, did she mean January or the summer?

(if it was January.... )

 

[stupot07]

I seem to remember OSB(?) saying that players under a certain age (21?) aren't included under FFP?


Sent from my iPhone using Tapatalk - so please excuse any spelling or grammar errors

 

[Ian1779]

I seem to remember OSB(?) saying that players under a certain age (21?) aren't included under FFP?


Sent from my iPhone using Tapatalk - so please excuse any spelling or grammar errors

I believe that is correct - and some that are over 21 too - depending on the notion of 'homegrown' - but I don't think that lasts forever.