new liverpool thread - everyone loves them (3 Viewers)

[trev]

wolves was an away game.

 

[Unicron]

http://www.guardian.co.uk/sport/2011/feb/04/john-w-henry-interview-liverpool

In cashflow terms that sort of makes sense but it has a negative impact on the FFP qualifications.

 

[oh shit]

how so? there was a small net loss on the deals - two in, two out. not sure what carroll and suarez are earning but it can't be more than torres plus babel. how can that be negative on FFP?

 

[Unicron]

how so? there was a small net loss on the deals - two in, two out. not sure what carroll and suarez are earning but it can't be more than torres plus babel. how can that be negative on FFP?

Because of the amortisation issue, if they paid 20 million for him they'd be writing down less money on him per annum than they will be now. As it happens it'll only be in the region of a million but it's still a factor.

 

[oh shit]

I don't follow. Amortisation applies to the value of assets. As I understand it FFP relates to income and expenditure - ie you have to make pre-tax profit? The written down value of the assets (players) on the balance sheet doesn't affect that because you're not actually paying any expense, it's just that the re-sale value of the asset has come down as he approaches a free bosman transfer. Or am I missing something in FFP

 

[Unicron]

I don't follow. Amortisation applies to the value of assets. As I understand it FFP relates to income and expenditure - ie you have to make pre-tax profit? The written down value of the assets (players) on the balance sheet doesn't affect that because you're not actually paying any expense, it's just that the re-sale value of the asset has come down as he approaches a free bosman transfer. Or am I missing something in FFP

I may be incorrect but I think that amortisation appears as a negative in the profit and loss statement of the accounts.

From a Swiss Ramble article about how City can get be FFP compliant:

When a player is purchased, his cost is capitalised on the balance sheet and is written-down (amortised) over the length of his contract. Importantly for Manchester City, this means that the cost of their recent purchases will have an impact on their accounts over the next few years via the amortisation charge.

http://swissramble.blogspot.com/2010/10/how-manchester-city-could-break-even.html

Actually there's an interesting passage in that piece which explains how despite the fact that City took something like a £14m bath on buying/selling Robinho they were able to report his move to Milan as a profit.

 

[Jerry Twig]

FUCK YEAH!!!!!

 

[Hector Grey]

thanks for the teamtalk, nando, that's twice this season you've been crucial in beating chelsea. not to mention bringing your form with you. ta.

 

[Wheels]

In your faces everyone!!! Well the media's faces. That's a fantastic result and I almost feel a twinge of sympathy for Torres, the fool. When he was through on goal and Martin Tyler nearly came in in his pants saying ' Fernando Torres - is this the moment?' .... the moment when Carragher showed him whose boss, yes. 65 minutes was another moment too and then god bless that man Raul for doing what Xabi did a few years back.

The King is dead - Long live King Kenny!!!!

 

[oh shit]

gonna stick a fiver each way on meireles or suarez to bang one in against chelski. hodgson was almost worthwhile just for signing meireles

ah yes indeed

 

[oh shit]

In your faces everyone!!! Well the media's faces. That's a fantastic result and I almost feel a twinge of sympathy for Torres, the fool. When he was through on goal and Martin Tyler nearly came in in his pants saying ' Fernando Torres - is this the moment?' .... the moment when Carragher showed him whose boss, yes. 65 minutes was another moment too and then god bless that man Raul for doing what Xabi did a few years back.

The King is dead - Long live King Kenny!!!!

fuck off torres 'never kissed the badge'. best torres moments today:
1. dagger's karate chop to the neck.
2. getting substituted. bookies all around chelsea and westminster made very happy.
3. meireles goal. you're not too big for lfc mate.
4. final whistle. enjoy talking it over with JT and fat frank.

 

[dunderhead]

moment of the match aside from goal had to be carra's block on nando. great stuff. result wouldn't have been possible without him i reckon. the lack of home noise around stamford bridge in the last 15, 20 mins was brilliant. dead lucky not to concede that pen in the 92nd. ivanovic is lethal from that position. went our way, good call johnson. this dalglish lad seems to have a clue about a thing or two. hats off to clarke too. huge part of that today. fourth seems a bit too far fetched unfortunately. chelsea not getting CL place would be gas craic though

hon the pool

 

[coast to coast]

Great win today. Our tactics and Chelsea's slow play made it a fairly turgid affair but we played admirably if not beautifully. Finding a formation (am as surprised today as I was Wednesday) that makes our defence more solid, Gives Glen Johnson a more attacking role and plays Gerrard and Meireles in attacking midfield positions is shrewd as fuck. The 3-diamond-wingbacks-kuyt doesn't exactly role off the tongue but it worked!

 

[oh shit]

three at the back with wingbacks did look very promising. kelly and johnson were brilliant at tucking in and closing space when the ball was coming in from the opposite flank. but we looked a bit slow getting forward on the break. maxi didn't look very sure of himself either (miss of the season?). if suarez and carroll come in for maxi and kuyt, will gerrard and meireles both keep playing free roles? is lucas good enough to hold the midfield on his own? or is this formation just for playing games where we won't control possession, with a 4-4-2 for games we should be bossing? exciting times either way

 

[Hector Grey]

ain't nothing wrong with a bit of versatility. if we can play like that and snatch a result in old trafford or the arsenal or anywhere then cool, but i reckon we have options to actualy change it around. lack of versatility was a bane, with rafa you always knew how we were gonna play. it's almost imposible to track meireles. his running was superb. still 4-5 players off a quality squad. but the dream is alive, and chelsea haven't managed to solve their problems by throwing a 50 million quid striker at them. we might not catch them for 4th, but sure as fuck totenham will give it a lash.

 

[Jerry Twig]

You can't be dropping Kuyt now for anything. He's a legend. Like Kenny says, Suarez and Carroll have to win a place!

 

[Jerry Twig]

I hope we lash the fuck out of Chelsea to start. That would be nice

that would be the stuff of dreams. .

Dream on baby!!

 

[oh shit]

I may be incorrect but I think that amortisation appears as a negative in the profit and loss statement of the accounts.

From a Swiss Ramble article about how City can get be FFP compliant:



http://swissramble.blogspot.com/2010/10/how-manchester-city-could-break-even.html

Actually there's an interesting passage in that piece which explains how despite the fact that City took something like a £14m bath on buying/selling Robinho they were able to report his move to Milan as a profit.

Right, thanks for this. I still don't agree that this reveals any disadvantage to Liverpool in respect of the Suarez and Carroll deals. Look:

As we have seen in the Robinho example above, when a player is purchased, his cost is capitalised on the balance sheet and is written-down (amortised) over the length of his contract. Importantly for Manchester City, this means that the cost of their recent purchases will have an impact on their accounts over the next few years via the amortisation charge.
We can see this effect over the last four seasons, as amortisation has grown significantly from £6 million in 2007 to £71 million in 2010. To place that into context, the next highest in the Premier League is Chelsea at £49 million, though they did get as high as £83 million in 2005 after their own version of supermarket sweep. Even big spending Barcelona and Real Madrid have lower player amortisation than City at £61 million and £55 million respectively

So what this means is that the purchase cost of any player - here it's Suarez and Carroll - will not be reported in this year's accounts as two cash-out expenditures (of £23m and £35m). Instead the transfer fee costs are divided by the years of the contracts with each player and applied across the accounts for that period accordingly - ultimately adding up to £23m and £35m.

But because we've been paid the cash up front in the Torres sale, and we have the fee from Babel coming in (I think that's installments) those amortisation costs are already fully covered. I think. Could be wrong. But that should be the same regardless of the sums involved.

I think the real calculation is the difference (if any) in wages between Babel and Torres and Suarez and Carroll. I assume it's similar or lower. But Suarez and Carroll are more likely to sell for reasonable profit down the line. Granted, reaching a profit is easier if your initial transfer fee is lower to begin with. But that depends entirely on the market and what other clubs think a man is worth. Last week Newcastle knew Chelsea were going for Torres, Liverpool thought Carroll was worth £15m less than Torres, and Roman Ambramovich inflated the market... Joke's on him.

 

[Unicron]

So what this means is that the purchase cost of any player - here it's Suarez and Carroll - will not be reported in this year's accounts as two cash-out expenditures (of £23m and £35m). Instead the transfer fee costs are divided by the years of the contracts with each player and applied across the accounts for that period accordingly - ultimately adding up to £23m and £35m.

But because we've been paid the cash up front in the Torres sale, and we have the fee from Babel coming in (I think that's installments) those amortisation costs are already fully covered. I think. Could be wrong. But that should be the same regardless of the sums involved.

You could be right. I'm not an accountant that was just my interpretation of the article. The up front Torres fee in would only appear in this year's accounts though right (although Chelsea will record it as 50 mill amortised over the length of his contract)? And the amortisation of Suarez and Carroll would be on an ongoing annual basis ... I think. And that would be 6.5m on Carroll instead of 5.5 if they'd got him for the lower figure, which was the thing that jumped out at me from the Henry interview. In cash flow terms the deal makes perfect sense but accounting is a bit of a dark art. Anyway I'm sure that Liverpool have people in the job far more familiar with the situation than I am who can make it work.

As for the wages I read last week that Suarez and Carroll combined will be pulling down what Torres was + 20k per week. I'd say that getting Babel off of the payroll will cover that gap.

 

[oh shit]

The up front Torres fee in would only appear in this year's accounts though right (although Chelsea will record it as 50 mill amortised over the length of his contract)? And the amortisation of Suarez and Carroll would be on an ongoing annual basis ... I think.

Yeah that's how I understand it. Been studying business accounts in recent months as part of solicitor training. It's intensely dull and I basically only stay awake in class by trying to think of it in football terms.. I think football contracts are similar to leaseholds. You buy the right to lease their productivity for a few years, you hire their services for a fixed period. You want to sell the lease on, so you need a means of calculating its worth to the club at a given point in its currency. Amortisation takes care of that by spreading out the purchase price evenly throughout the period of contract that you've bought.