Robin Koch- Signs pre contract with Eintracht Frankfurt

[weasel]

The whole thing is illogical though.

If what you say is true (and I am not saying it isn't because I really don't get it).

Then no football club ever would ever sell at a loss.

They'd just run the contract down break even and carry on.

That's why I say it works against smaller clubs who don't have rich owners. City, Chelsea etc can simply spend what they want and as shown in my examples get round FFP even if they were losing billions from a business point of view. Whereas say a lower league club needs to sell to keep afloat but by doing so could actually come afoul of FFP.

That's why our loan deals (apart from Koch's) made great sense in terms of FFP but no sense at all in a business sense.

Say for example (and will use estimated values and contracts) we sold these players last summer for the fees I have put

Aaronsen for £10m
Rasmus £5m
Roca £5m
Wober £8m

Initially you would think okay we lost a fair bit of money but at least we have £28m to now spend.

But instead we would have been £15.5m down on what FFP would allow us to spend

£8m down FFP wise on Aaronsen (£24m 4 year contract FFP value £18m)
£4m down FFP wise on Rasmus (£12m 4 year contract FFP value £9m)
£2.5m down FFP wise on Roca (£10m 4 year contract FFP value £7.5m)
£1m down FFP wise on Wober (£10.5m 3 1/2 year contract FFP value £9m)

So instead of having £28m to spend we don't. We have £28m sitting in the bank and have to sell someone, who has no FFP value, for £15.5m just to be level on FFP. So maybe we sell all those but then have to sell Gnonto for around £25m (let's assume that gives us a £15.5m profit after his FFP value is taken off and we pay Zurich their % cut of the profit) just to balance out FFP balance. So we have raised £43.5m in player sales but can't spend any of it.



As it was we sold Tyler Adams for £25m which saw us bring in £10m against FFP - (in this example I am suggesting we bought him for £20m on a 4 year deal). We also sold Rodrigo for £3m which was a £3m loss against FFP (£24m 4 year deal value was £6m). As such we raised a total £7m that we could spend against FFP.

We brought in Piroe for £15m, Ampadu £7m, Kamara £5m and Gruev £5m. Let's say those were all on 4 year deals so that is £32m spent that equates to an FFP expense of £8m for the year. As such we're £1m down against FFP this season for our transfer dealings.

[danhirons]

That's why I say it works against smaller clubs who don't have rich owners. City, Chelsea etc can simply spend what they want and as shown in my examples get round FFP even if they were losing billions from a business point of view. Whereas say a lower league club needs to sell to keep afloat but by doing so could actually come afoul of FFP.

That's why our loan deals (apart from Koch's) made great sense in terms of FFP but no sense at all in a business sense.

Say for example (and will use estimated values and contracts) we sold these players last summer for the fees I have put

Aaronsen for £10m
Rasmus £5m
Roca £5m
Wober £8m

Initially you would think okay we lost a fair bit of money but at least we have £28m to now spend.

But instead we would have been £15.5m down on what FFP would allow us to spend

£8m down FFP wise on Aaronsen (£24m 4 year contract FFP value £18m)
£4m down FFP wise on Rasmus (£12m 4 year contract FFP value £9m)
£2.5m down FFP wise on Roca (£10m 4 year contract FFP value £7.5m)
£1m down FFP wise on Wober (£10.5m 3 1/2 year contract FFP value £9m)

So instead of having £28m to spend we don't. We have £28m sitting in the bank and have to sell someone, who has no FFP value, for £15.5m just to be level on FFP. So maybe we sell all those but then have to sell Gnonto for around £25m (let's assume that gives us a £15.5m profit after his FFP value is taken off and we pay Zurich their % cut of the profit) just to balance out FFP balance. So we have raised £43.5m in player sales but can't spend any of it.



As it was we sold Tyler Adams for £25m which saw us bring in £10m against FFP - (in this example I am suggesting we bought him for £20m on a 4 year deal). We also sold Rodrigo for £3m which was a £3m loss against FFP (£24m 4 year deal value was £6m). As such we raised a total £7m that we could spend against FFP.

We brought in Piroe for £15m, Ampadu £7m, Kamara £5m and Gruev £5m. Let's say those were all on 4 year deals so that is £32m spent that equates to an FFP expense of £8m for the year. As such we're £1m down against FFP this season for our transfer dealings.

Sorry weasal you're wrong on the running contracts down thing. Chelsea get away with it because they signed players on really long contracts (no longer allowed). Man city get away with it because of dodgy sponsorship deals meaning they bring a lot of money in. If you sign a player and let him run his contract down and leave for nothing, he will be a loss for each of those years.

You sign a player for 20 million GBP on a 4 year contract and he leaves after 4 years on a free somewhere else, is a -5 million on FFP each year. If he signs a contract extension the remaining amortized amount gets spread over the additional contract years.

Hence Chelsea have signed a load of players on 8 year deals because they can spread the transfer fee over 8 years e.g., 80 million pound fee is 10 million GBP every contract year (spread out even further if the player signs a new contract at some point). UEFA have now stopped this practice, I think the max is 5/6 years regardless of contract length now.

Conceptually what you're saying just doesn't make any sense on the players running their contracts down - I don't even fully understand how you come to that conclusion.

Also the loan deals make no sense from a FFP position, as I explained above Phil Hay confirmed the loan deals were only included in the players' contracts so that they would accept relegation wage reduction clauses.

If, instead we would have sold Koch this summer, for say 10 million, this would have counted against his ffp amortized fee this year i.e., it would have been for this financial year: - 13/4 + 10 = +6.75 mill on FFP balance. Instead it was -13/4 + (whatever loan fee we got)

[weasel]

Sorry weasal you're wrong on the running contracts down thing. Chelsea get away with it because they signed players on really long contracts (no longer allowed). Man city get away with it because of dodgy sponsorship deals meaning they bring a lot of money in. If you sign a player and let him run his contract down and leave for nothing, he will be a loss for each of those years.

You sign a player for 20 million GBP on a 4 year contract and he leaves after 4 years on a free somewhere else, is a -5 million on FFP each year. If he signs a contract extension the remaining amortized amount gets spread over the additional contract years.

Hence Chelsea have signed a load of players on 8 year deals because they can spread the transfer fee over 8 years e.g., 80 million pound fee is 10 million GBP every contract year (spread out even further if the player signs a new contract at some point). UEFA have now stopped this practice, I think the max is 5/6 years regardless of contract length now.

Conceptually what you're saying just doesn't make any sense on the players running their contracts down - I don't even fully understand how you come to that conclusion.

Also the loan deals make no sense from a FFP position, as I explained above Phil Hay confirmed the loan deals were only included in the players' contracts so that they would accept relegation wage reduction clauses.

If, instead we would have sold Koch this summer, for say 10 million, this would have counted against his ffp amortized fee this year i.e., it would have been for this financial year: - 13/4 + 10 = +6.75 mill on FFP balance. Instead it was -13/4 + (whatever loan fee we got)

Yes you're right about the yearly hits but by running the contract downs you are taking the small hit per year rather than the lump sum loss if we were to sell a player mid contract for a vast loss. So as an example if we sold AAronsen last summer for £10m we take the big hit there and then. If he goes a year later for the same £10m we have the loss of his value over this year but then a smaller loss against FFP next year. So it is about managing the losses so it isn't a huge loss one season. Going on loan also saved the wages which are likely a few million too.

So it sort of means not taking the huge hit this year, take a manageable hit, and then we also take a hit next season but again not a huge hit - and of course if we go up it becomes less of an issue.

[danhirons]

Yes you're right about the yearly hits but by running the contract downs you are taking the small hit per year rather than the lump sum loss if we were to sell a player mid contract for a vast loss. So as an example if we sold AAronsen last summer for £10m we take the big hit there and then. If he goes a year later for the same £0m we have the loss of his value over this year but then a smaller loss against FFP next year. So it is about managing the losses so it isn't a huge loss one season. Going on loan also saved the wages which are likely a few million too.

So it sort of means not taking the huge hit this year, take a manageable hit, and then we also take a hit next season but again not a huge hit - and of course if we go up it becomes less of an issue.

i get you! makes sense now

[Cjay]

Yes you're right about the yearly hits but by running the contract downs you are taking the small hit per year rather than the lump sum loss if we were to sell a player mid contract for a vast loss. So as an example if we sold AAronsen last summer for £10m we take the big hit there and then. If he goes a year later for the same £0m we have the loss of his value over this year but then a smaller loss against FFP next year. So it is about managing the losses so it isn't a huge loss one season. Going on loan also saved the wages which are likely a few million too.

So it sort of means not taking the huge hit this year, take a manageable hit, and then we also take a hit next season but again not a huge hit - and of course if we go up it becomes less of an issue.

Ah I see now that's basically how I understand it.

But ultimately its still a loss.

And ffp is over a 3 yer rolling period so for Koch it still is going to be a loss approaching £10mil

[weasel]

Yeah it's a bit like a business, say Wilko's, doing their accounts and saying they are £10m in debt but have stock worth £15m. However the stock is only worth £15m if they sell it at full value.

They could sell it as a discount, say half price, but then would only recoup £7.5m and as such would go out of business with £2.5m debts.

Instead they try to sell all the stock at full value. They sell £5m worth of stock, at full value, and can keep paying their staff (lets say £2m in wages). They don't go out of business. They use the £3m they have made (the £5m minus the £2m wages) to pay £1m to the bank to pay the interest on the £10m debt, and to buy £2m worth of new stock and keep the business going. They now still owe £10m and only have £12m of stock instead of £15m but they have kept the bank happy and the staff happy so the business continues.

That's sort of how I see it with FFP. You can run your business (the club) into the ground making loss after loss but satisfying FFP requirements. At some point though you run out of stock (players with value) and are f*cked. FFP doesn't protect clubs and certainly doesn't make things fair.