UEFA Financial Fair Play

B-Mac wrote:liverpool

Liverpool are under no real threat. Both investment into youth and infrastructure and the projected revenues mean Liverpool are in the clear.

Kick wrote:Inter????

They've barely spent anything in recent seasons.

infact ....
We aren't in a good economic period and this is the main reason for current results, but we have reduced the losses and I think Uefa will consider it

RealGunner wrote:Liverpool, Monaco, Inter Milan & Roma set to be light heardetly told off by UEFA for FFP breach [Guardian]

RedOranje wrote:

B-Mac wrote:liverpool

Liverpool are under no real threat.  Both investment into youth and infrastructure and the projected revenues mean Liverpool are in the clear.

That's got nothing to do with it RO...  UEFA cares nothing about investment.  All they're looking at is the bottom and how that bottom line is expected to evolve.  

If you breach the rules, you get a fine, have some kind of European player registration reduction and a constraint on your transfers for a season or two.

They set the precedent with this last year and i don't see them breaking it.

Uefa will consider whether the club is seriously working towards complaying in the near future before the punishment is decided. There is a difference between the likes of Inter and liver and the likes of Qsg and City and uefa knows it

No that's not true either...  they will look at the books and see what the clubs can afford in terms of transfers and set the transfer budget for them in the immediate term.  That's what they did with PSG and City.  They will do the same for Inter and Liverpool.

The fines and penalties are there to punish you for breaking the rules.  The transfer restrictions are there to guarantee that you won't break them in the coming year(s).

sportsczy wrote:

RedOranje wrote:

B-Mac wrote:liverpool

Liverpool are under no real threat.  Both investment into youth and infrastructure and the projected revenues mean Liverpool are in the clear.

That's got nothing to do with it RO...  UEFA cares nothing about investment.  All they're looking at is the bottom and how that bottom line is expected to evolve.  

If you breach the rules, you get a fine, have some kind of European player registration reduction and a constraint on your transfers for a season or two.

They set the precedent with this last year and i don't see them breaking it.

That's fundamentally inaccurate, as the FFP guidelines clearly state that a certain amount of investment into infrastructure and youth can be written off of expenses. It is specifically and directly stated so in the documents that lay out FFP's structure, scope, and function.

3) Are clubs no longer allowed to have losses?

To be exact, clubs can spend up to €5million more than they earn per assessment period (three years). However it can exceed this level to a certain limit, if it is entirely covered by a direct contribution/payment from the club owner(s) or a related party.

The limits are:
• €45m for seasons 2013/14 and 2014/15
• €30m for seasons 2015/16, 2016/17 and 2017/18

In the following years the limit will be lower, with the exact amount still to be decided.

In order to promote investment in stadiums, training facilities and youth development, all such costs are excluded from the break-even calculation.

http://www.uefa.com/community/news/newsid=2064391.html

2. Permitted Exclusions

I should also point out that the level of loss that a club reports in their financial accounts will not be the same figure as is used in the Break Even calculations. This is because UEFA have allowed clubs to exclude certain expenditure from the calculations. UEFA are keen to develop the game and don't want the FFP rules to constrain clubs from investing and developing - without any exclusions a club building a new stadium or new stand would be hit by an FFP penalty (the cost of the development would mean the club reported a large financial loss). Clubs can therefore exclude infrastructure development costs and youth development/community development costs. Manchester City announced that they should be able to exclude around £10m a year as a result of the youth/community exclusion.

There is one other exclusion that causes most confusion amongst journalists and fans; clubs are able to exclude certain wages for their long-standing players. By way of background; when the rules were first proposed, some clubs complained that they were already committed to paying high wage bills for some players on existing contracts and that they could fail the Break Even test as a result. UEFA therefore introduced an appendix to the rules which allows clubs who have failed the Break Even test to run the test again, but this time deduct the wages paid to players on pre-June 2010 contracts. However clubs can only deduct the wages paid to their long-standing players during one season (2011/12) and can only use the exclusion if they can show their Break Even deficit is reducing each year. Chelsea, for example, will probably find that they are not able to deduct the wages paid to Terry, Lampard, Drogba etc during 2011/12. This is because club losses are likely to increase in 2012/13 (they won the Champions League in 2011/12 and are likely to see their UEFA receipts and commercial income reduced in 2012/13).

http://www.financialfairplay.co.uk/financial-fair-play-explained.php


So for Liverpool:

This is Anfield wrote:1. Projected loss for 2011/12, 12/13 and 13/14 seasons: £83m

2. Exclusions:

   Youth and Community costs: £18.9m
   Depreciation: £9.6m
   Wage exclusion (as explained above): £50m

Total exclusions: £78.5m

3. Readjusted loss total: £4.5m

http://www.thisisanfield.com/2014/09/liverpool-fc-breach-uefa-financial-fair-play-rules/


Well below the limit for any sanctions.

WOWWW are you a magician RO? Because using a logical thought process must be magic around here.

I love it went RedO does his magic

Also why I never debate with him.

But here's the thing...  capital investments (investment into a balance sheet item) is NOT an income statement transaction.  It's a balance sheet transaction.  The only thing that goes towards the income statement is "depreciation".  Depreciation is calculated by taking the value of the capital asset + any improvements made to it and dividing it by its useful years (financial regulations tell you how much you're allowed).  For real estate, it's 30 years typically in the US for example....  so the income statement impact of doing capital investments to your stadium and youth facilities for let's say 200 million is 200/30 = 6,7 million annually.  

So i don't get how investing in facilities is going to affect your income statement significantly one way or another unless you spent 1 billion in the current year  I think UEFA allows you to exclude the depreciation too...  that's the only impact.

Second, all organizations send governing bodies (SEC, UEFA, etc.) their financial statements with the most aggressive numbers they can get away with...  Why would Liverpool send UEFA numbers that aren't maximized for showing the lowest losses possible?  Makes no sense.  Even though it's likely not much, i would think Liverpool would present its figures with every possible FFP allowed exclusion possible.

Third, the guy who is explaining stuff on top is obviously not an accountant in the Echo.  The guy from financialfairplay.co.uk is an expert however and his stuff makes sense.  Even so, i think there's confusion in balance sheet v income statement and accrual v cash.  He's looking at it from the perspective of a financial analyst, not an accountant.  It's different.  Financial statements are presented and governed by accounting standards.  It would be great if a Chartered Accountant took what that dude said and apply it within the framework of the financial reporting rules.  It's a bit backwards because financial analysts typically take financial statements prepared by accountants and adjust them for their purposes...  but in this case, it would be interesting to see how a CA would implement the analyst's interpretation of FFP.

Roma and Inter have both been fined and had their European squads limited for breaching Financial Fair Play rules.

The Serie A sides were among 10 clubs being investigated by UEFA for breaching its rules, and both have accepted a deal with the governing body.

UEFA announced the sanctions on its official website.

Inter will only be able to name 21 players in their European squad for next season, rather than the usual 25, should they qualify for the Europa League.

The following season would see the Nerazzurri limited to 22 players, but the restriction will be lifted in 2017/18 if targets are met.

Those targets include limiting losses for the 2016 financial year to €30m, and breaking even by 2017.

The Beneamata have also been fined €20m, of which €6m is payable “irrespective of any early exit from the settlement regime”, while the other €14m may be waived if targets are met.

The money will be deducted from any revenue generated by the club by competing in UEFA competitions.

As for Roma, the Giallorossi will be limited to a squad of 22 for next seasons Champions League or Europa League, a sanction which will be lifted if they achieve a loss of €30m or less for 2015 and 2016.

The Lupi have been fined €6m, of which €2m is mandatory, with the rest possibly being lifted based on targets, with the money again taken for UEFA revenues.

http://football-italia.net/66218/roma-inter-get-ffp-sanctions

Not hugely surprised since they both spend a lot while their income is not as much

Monaco also in trouble.

They will offload more players I think.

So...

Liverpool is not under investigation?!

UEFA is trying to do all to keep rich rich and poor poor. How could Roma or Inter ever rise to CL level, make constant profit if they cant invest in squad? Wait 20 year for another Totti?

flameas wrote:UEFA is trying to do all to keep rich rich and poor poor. How could Roma or Inter ever rise to CL level, make constant profit if they cant invest in squad? Wait 20 year for another Totti?

exactly .

that's also the reason why they banned third party ownership that helps teams like Altetico and Porto build competitive teams .

lol at people cheering for these " reforms " .

Ffp is the biggest joke in football after FIFA. Ridiculous. it was designed to stop clubs going bust now they are stopping investments from owners. Surely it must be illegal as if the football club is the asset that is wholly controlled by thone entity/ owner, they should be able to invest as much money as they want as long as they can prove they can sustain it. Farce.

Agreed with all of the above posts.

Watch Bayern,Barca,Madrid dominate the CL for another decade or more perhaps.

S wrote:Agreed with all of the above posts.

Watch Bayern,Barca,Madrid dominate the CL for another decade or more perhaps.

United were there before 2012 f's

2007 semi's
2008 final
2009 final
2011 final

F's

we'll be back jibs

we have the means

Except its not the only determining factor.

Man United could still eventually get to the top but with incompetent transfers and poor management,it could well be a rather slow process.

Doc wrote:So...

Liverpool is not under investigation?!

LFC were cleared months ago, mate.

Okay , we are officially done

FFP regime exactly in our worst period when we need of spending consistent money to raise us. lol

FPF what a joke, totally agreed with comments above.

the Uefa's objective, at least the initial idea, had to be the achievement of balance where the winners weren't just who had more money , basically similar to NBA ... but , as usual, the football world got the opposite result and it is becoming an oligarchy.
Inter to win again the Champions League after 45 years was a relevant event, but evidently it is most amusing to watch the same winners every year.

Doc wrote:So...

Liverpool is not under investigation?!

Our financial situation has never been healthier

you know what would actually be financial fair play ?
limit the transfer budget for everybody . and watch teams like Porto and Benfica destroy the likes of Madrid and Psg in the market thanks to good scouting and good ol common sense .

" you can't spend money because you didn't earn enough "
"you 're also not allowed to get a wealthy benefactor to inject cash into your team and help you achieve the first condition "
" and btw , you're not allowed to buy third party owned players on the cheap , because apparently that's slavery "

fair play !