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- Thread starter Voice_of_Reason
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grego_gee
New Member
Well as illogical as it seems in our situation (if we get thrown out of the Ricoh the first thing we'd have to worry about would be renting another venue) but I'll bow to your accountants hat!
if that is the case it does explain TF appearing to be more concerned about the other revenue streams rather than the rent!
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oldskyblue58
CCFC Finance Director
just a thought................ but if TF gets the rent down and agreed levels for higher divisions, gets access at no or low cost to match day income streams, has a team competing for promotion, drives other costs down, gets players on less costly contracts, no more money from SISU.............. does that make the club more saleable?
I dont mean get the SISU money all back but would it maximise what they can get? Could they work a deal on some of the remaining debt ?
I dont mean get the SISU money all back but would it maximise what they can get? Could they work a deal on some of the remaining debt ?
grego_gee
New Member
It doesn't matter to me whether they are trying to improve it with a view to selling on, the salient point is that they ARE trying to improve!
(And ACL/CCC appear to be an obstacle to getting there!)
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sky blue john
Well-Known Member
Theres a lot of big ifs in your thoughts there.
grego_gee
New Member
Just an amusing aside...
if you go to Shane Oconnor's useful post on you tube of the tim fisher interview...
http://www.youtube.com/watch?v=4X0GYpV-XmQ
and turn on the transcript option (which is on the line "About Share Add to......."
its hilarious in parts..
the speech recognition goes berserk and even mention Al Fayed in part...
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if you go to Shane Oconnor's useful post on you tube of the tim fisher interview...
http://www.youtube.com/watch?v=4X0GYpV-XmQ
and turn on the transcript option (which is on the line "About Share Add to......."
its hilarious in parts..
the speech recognition goes berserk and even mention Al Fayed in part...
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CCFC_GT
New Member
Thanks OSB, appreciate the feedback, and of course whether or not TF is right doesn't alter the fact that neither rent reduction or cash injection gives CCFC even £1 more to spend on players.
Now to take the debate a stage further for everyone ... If ACL were to offer a completely different deal, and i quote figures just as an illustration ... say they propose to charge CCFC £1.5M in rent annually instead of the £400k or whatever presently on the table, and at the same time allow CCFC access to £1M in additional revenues, the net effect of the deal is that ACL now get £500k instead of just £400k from CCFC, but CCFC has an additional £1M in revenue, of which 65% can be added to the funds available to spend on players. WIN-WIN! Or am i just missing something?
grego_gee
New Member
I think you are missing a bit!....
the FFP limits is just that, a limit..... it is not actual money.
the money has to be freed up and made available from somewhere in all the incomings and outgoings of the business...
but in principle that seems to be the crux - the FFP limit on playing budget cannot be increased by funding from SISU although that would seem to be necessary to find any money at all to spend on players.
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the FFP limits is just that, a limit..... it is not actual money.
the money has to be freed up and made available from somewhere in all the incomings and outgoings of the business...
but in principle that seems to be the crux - the FFP limit on playing budget cannot be increased by funding from SISU although that would seem to be necessary to find any money at all to spend on players.
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CCFC_GT
New Member
I think you are missing a bit!....
the FFP limits is just that, a limit..... it is not actual money.
the money has to be freed up and made available from somewhere in all the incomings and outgoings of the business...
but in principle that seems to be the crux - the FFP limit on playing budget cannot be increased by funding from SISU although that would seem to be necessary to find any money at all to spend on players.
The FFP limits what can be paid on players wages as a % of revenue, so if revenue is increased the actual amount (£) spent on the squad can increase accordingly.
I take your point that if CCFC pays out more in rent then it has to find the money from somewhere to do that if it is to at the same time pay more in wages, but I expect funds from SISU could cover the rent, as FFP does not dictate where funds for fixed overheads such as rates come from.
grego_gee
New Member
Thanks for your comments GT (&OSB)! I am not disagreeing at all, I think we see the situation in very much the same way.
It is concevable that because of debts, any given club could only find a proportion of whatever the ffp limit turned out to be.
It is really very heartening that TF ie SISU seem to be very concerned about trying to maximise it! That infers they will be prepared to find the funds for the maximum increased amount!
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CCFC_GT
New Member
Well you can buy and sell individual players within the existing budget that is fixed by the current revenue, but to increase the overall budget for the squad you need more revenue.
thegameaintstraight
New Member
In my experience what is revenue and what is capital can be a moveable feast. I bet Mr Abramovich has it sorted.
grego_gee
New Member
In general finance that maybe true but not when its an artificial constraint written into Football league rules especially to get over the unfair bias brought to the game by Russian oligarchs!
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thegameaintstraight
New Member
grego_gee
New Member
Your example exposes the reality of the situation. Arguably your example would benefit ccfc, It might be worth them paying more rent than they are currently contracted to pay in order to benefit under ffp by getting back the other matchday revenues. But in reality they have generated those mach day revenues, they would not exist without the draw of the football match. And the rent should be what is worth for the function required ie to house 10-15000, ie an average league 1 rent, its not worth any more even if its super shiney and can seat 20,000 more fans than attend. Its not however a win win. You just had SISU paying over 1m every year in rent just to buy back the revenues that they generated in the first place, in order to get back the permission of the FL to spend another 650k on players. And they will have to find that money for that after paying 1m extra in rent!
Win win?
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CCFC_GT
New Member
Your example exposes the reality of the situation. Arguably your example would benefit ccfc, It might be worth them paying more rent than they are currently contracted to pay in order to benefit under ffp by getting back the other matchday revenues. But in reality they have generated those mach day revenues, they would not exist without the draw of the football match. And the rent should be what is worth for the function required ie to house 10-15000, ie an average league 1 rent, its not worth any more even if its super shiney and can seat 20,000 more fans than attend. Its not however a win win. You just had SISU paying over 1m every year in rent just to buy back the revenues that they generated in the first place, in order to get back the permission of the FL to spend another 650k on players. And they will have to find that money for that after paying 1m extra in rent!
Win win?
I agree with you to an extent, and in my view CCFC generates revenues for the arena that actually go beyond just match day revenues, and arguably adds value to such things as advertising and stadium sponsorship rights. However taking the balanced view it has to be also recognised that ACL not only paid for and owns the rights to those revenues, but it would seem by the figures I mentioned earlier today in this thread that ACL is dependent on them too as things stand. So it is understandable why revenue is such an issue between the parties and is likely to lead to a stalemate situation that I doubt will end well for CCFC. So the alternative deal I have proposed above would, on the face of it be a WIN-WIN for ACL and CCFC. Yes it would mean that SISU would need to inject additional funds to CCFC for rent payment (assuming there is no small print in the FFP regulations to block such a move) and of course such a solution understandably would not be an option that SISU would be keen on unless backed into a corner, which may well happen. However if SISU were to look at the bigger picture that this releases additional revenue that can be invested in the playing squad, and may lead to success for CCFC that enables SISU to sell on and at least recover something on their investment, then it could be a WIN-WIN-PARTIALWIN situation, and the best that SISU can perhaps hope for.
Are you saying we need more revenue to buy players because of FFP rules, or are you saying we need more revenue so we have more money to buy players?
I was saying you can completely get around the ffp rules by buying at selling players because that increases your revenue even if you make a loss.
CCFC_GT
New Member
Sorry misled you ... we need more revenue to pay more wages.
If you make a profit on buying and selling players that profit is then additional revenue, 65% of which can then be used to pay more in wages. But of course you have to have the money to buy players first, and that isn't a course SISU is taking.
it's revenue even if you don't make a profit, of course we don't have the money to throw around doing that. I was just kinda saying I think ffp is pointless because you can get around it buy buying and selling players. If every year you spend 2 million on players and sell 2 million worth of players, you can now spend another 1.3million on wages. Unless I misunderstand how ffp works.
CCFC_GT
New Member
Yes I see what your saying, and you are right FFP would then be pointless if you happened to have £1.3M lying around to spend on wages. The Football League's own website makes it sound as if that could happen because it simply says that FFP is linked to turnover. But in his interview on 15/02 TF said FFP was based on allowable revenue, i.e. income less cost of sales (which for example would be the cost of buying the player in the first place), and this is the only way FFP would make any sense.
Mary_Mungo_Midge
Well-Known Member
I think OSB58's wisdom may be needed here. Players, I'm sure, are classified as assets, and their sale as disposal of assets. So I'm not sure this would be accounted for as a cost of sale line item.
Might be an anomaly of FFP rules. You can seemingly increase revenues as above, make no cash and it qaulifies in the 65/60% rating; whereas in other instances could can create cash but not qualify as it counts as asset disposal? In which case, a mixed bag to satisfy both masters would be necessary?!?!?
CCFC_GT
New Member
So perhaps the 'allowable' revenue TF mentioned in his interview on 15/02 may exclude revenue that results from the buying and selling of assets, such as players.