The Mail Bag
Increased Turnover
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The official site has a new article stating that EFC turnover has increased by 47% and we have actually made a profit of approximately £7 million before player trading and amortification.
Could this mean there will be a bit of money to spend in the january sales?
I'm fairly certain Mr Kenrick wont partake but with that type of money I'd like to see either Charles N'zogbia or possibly Aaron Lennon. any others on your Xmas wishlist?
Before the doomongers post in, I know the finance dept. doesn't work like that.
Ste Kenny, Posted 17/12/2008 at 13:58:53
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Ste: You answered your own question; you know finance doesn?t work like that, so why expect to be able to spend the virtual £7 million (BEFORE player trading and amortisation...)!! on players??!!!!
Andy : the actual profit was about £240k. Where would you like to see that spent? Do you really think that you would be able to visibly see, with a keen and intelligent eye, on Everton finances and GP up-keep, where £240k might go whereas it wouldn't end up in "Bill's wallet" as you put it?
Do you even understand what the kind of costs are in running a business?
Andy : the actual profit was about £240k. Where would you like to see that spent? Do you really think that you would be able to visibly see, with a keen and intelligent eye, on Everton finances and GP up-keep, where £240k might go whereas it wouldn't end up in "Bill's wallet" as you put it?
Do you even understand what the kind of costs are in running a business?
Is this not excellent management and business growth at all but just an increase in prize money from Sky.
Instead of people casting aspersions on the character of those involved with the club, maybe they could spare the odd 5 minutes or so to actually look at the accounts, then maybe they will see where the money gets spent.
Almost £57m has gone on employee costs and amotisation of transfer fees. £21m has gone on other operating costs. Or perhaps BK has a code in his accounts labelled "Bill Kenwright?s Wallet" which he uses to siphon off money.......??
These accounts are audited, and the possibility of the directors of the business defrauding the company is something they specifically check ? or maybe the auditors are in on it too...??
But hey, don?t let the facts get in the way of a good libel....
Almost £57m has gone on employee costs and amotisation of transfer fees. £21m has gone on other operating costs. Or perhaps BK has a code in his accounts labelled "Bill Kenwright?s Wallet" which he uses to siphon off money.......??
These accounts are audited, and the possibility of the directors of the business defrauding the company is something they specifically check ? or maybe the auditors are in on it too...??
But hey, don?t let the facts get in the way of a good libel....
Jeremy,
I dont expect us to be able to spend the £7 million I was stating the type of player i’d like us to go for if the money was available.
I know FM style debates are not everyone’s cup of tea however I happen to enjoy finding out what player’s other evertonians would like to see playing for the blues. And as we are now operating on a profit albeit a small one we may see money made available for transfer’s
I dont expect us to be able to spend the £7 million I was stating the type of player i’d like us to go for if the money was available.
I know FM style debates are not everyone’s cup of tea however I happen to enjoy finding out what player’s other evertonians would like to see playing for the blues. And as we are now operating on a profit albeit a small one we may see money made available for transfer’s
Micheal, there is usually an analysis of the figures by a learned colleague on here... I assume you have got it sorted? Good man.
The debt jumped to £66 million ? how the fuck is that a sucess??
Not sustainable.
Not sustainable.
Anyone noticed that Everton’s overdraft has increased from £1million to £12 million over the past year? This is causing interest payments in excess of £1 million per year. Bill Kenwright is quoted as saying that the accounts are due to prudent and careful financial planning...
I take it, Bob ? you are presuming that EFC are accounting for their transfers in full instead of on the drip, ie £X million over 5 years etc...
£240k? Just chip in another £60k and Moyes can find us Davie Weir Mark II.
Ste, great shout on Charles N?Zogbia... would love to see him at Everton and could be a steal (in this day and age) as I reckon we could get him for £4m-£4.5m.
Bob Turner
Why have ?Other operating costs? risen from £11.69m in 2007 to £21.08m in 2008?
How much is it costing us to lease Finch Farm? There?s no mention of it in the accounts.
Why have ?Other operating costs? risen from £11.69m in 2007 to £21.08m in 2008?
How much is it costing us to lease Finch Farm? There?s no mention of it in the accounts.
God dammit! This site has become a vile libellous pit of vipers. The most bitter outpourings of RS fans are put in the shade by some of the venomous over the top crap that drips like poison over anything that puts the club in a psitive light.
With appologies to the TW editor, I cannot describe some of the postings on this topic as being anything but anti-Everton...
With appologies to the TW editor, I cannot describe some of the postings on this topic as being anything but anti-Everton...
Very funny, Dick. But I think you’re in the wrong thread...
So the players' amortisation (a term incidentally which is usually used for assets like mortgages) has depreciated by £12.3 million pounds in the past year. So which players values have gone down? Arteta I suppose by say £3M, maybe Van der Meyde by £1M, maybe Yakubu now his achilles has gone but then Jags has probably gone up ? and who the fuck makes these valuations?
Steve
Transfers are accounted for by spreading the cost of the player over the length of the contract.
Mark
I don?t know why Other Operating Costs have increased - but these costs have been audited, so it?s a fair assumption that the costs are legitimate costs of the business.
These accounts, along with all accounts published by all companies in the UK, contain the minimum amount of detail required. There?s no great conspiracy about it all, no business reveals more details about its operations than it?s legally obliged to do.
Mick
Arteta?s value in the accounts can?t have gone down by £3m, given that we only bought him for £2m in the first place. The amortisation is calculated strictly as fee divided by number of years in the contract, it has nothing to do with the "market value", perceived or otherwise, of a play.
In Arteta?s case, his £2m will have been amortised over the original length of his contract (not sure what that was, but let?s say 4 years). So his value in the accounts will reduce by £500k per year. However, he has since signed a new contract (5 years, I think?). So his remaining value at that time, say £1m, will then be spread over the new 5 year term, so £200k per year.
Similarly with Cahill, who has since gone on to sign a new contract.
Yakubu?s fee of £12m will automatically be reduced over the 4/5 years of his contract (not sure how long), regardless of injuries.
Incidentally, if a player?s value increases, which is arguable for Cahill, Arteta, Lescott etc, Everton will not be allowed to revalue them in their accounts, as they cannot recognise a "profit" until it is realised i.e. when they are sold. Similarly, home grown players like Osman and Hibbert will have no value in the accounts because they did not cost us anything (and no sarcastic comments about that being their true value please!)
There are strict accounting rules which Everton, along with every other football club, must follow, and there is no margin for manipulation to suit BK?s, or anyone else?s, preferences.
Transfers are accounted for by spreading the cost of the player over the length of the contract.
Mark
I don?t know why Other Operating Costs have increased - but these costs have been audited, so it?s a fair assumption that the costs are legitimate costs of the business.
These accounts, along with all accounts published by all companies in the UK, contain the minimum amount of detail required. There?s no great conspiracy about it all, no business reveals more details about its operations than it?s legally obliged to do.
Mick
Arteta?s value in the accounts can?t have gone down by £3m, given that we only bought him for £2m in the first place. The amortisation is calculated strictly as fee divided by number of years in the contract, it has nothing to do with the "market value", perceived or otherwise, of a play.
In Arteta?s case, his £2m will have been amortised over the original length of his contract (not sure what that was, but let?s say 4 years). So his value in the accounts will reduce by £500k per year. However, he has since signed a new contract (5 years, I think?). So his remaining value at that time, say £1m, will then be spread over the new 5 year term, so £200k per year.
Similarly with Cahill, who has since gone on to sign a new contract.
Yakubu?s fee of £12m will automatically be reduced over the 4/5 years of his contract (not sure how long), regardless of injuries.
Incidentally, if a player?s value increases, which is arguable for Cahill, Arteta, Lescott etc, Everton will not be allowed to revalue them in their accounts, as they cannot recognise a "profit" until it is realised i.e. when they are sold. Similarly, home grown players like Osman and Hibbert will have no value in the accounts because they did not cost us anything (and no sarcastic comments about that being their true value please!)
There are strict accounting rules which Everton, along with every other football club, must follow, and there is no margin for manipulation to suit BK?s, or anyone else?s, preferences.
Interesting Bob, is that for all football clubs, or just Everton? Haven?t picked up accounting since uni in the early 90s so don?t know if new accounting rules have been in place. But at that time Spurs were valuing Gazza in their books way above the £2mil they originally got him for. I?m not sure it?s as simple as prudent accounting and player value is not ?realized? until sold.
I?m sure Cristiano Ronaldo?s stock is much higher than the price Man Utd got him for from Sporting, and needs to be ?reflected? in their books, together with goodwill value (marketing opportunities etc). Still, player valuation is subjective that I can agree. I suppose that?s why accounting didn?t work out for me heh?
As for home grown players, I won’t take Ossie and Hibs as an example but that fuckwit Gerrard. He’s homegrown, has no value or class, but cost us the fucking derby!
Turnover increases by £17m. Gate receipts increased by £3.4m and income increased by £19.1m. Therefore, it appears that the factors controlled by Wyness, before his departure, cost us £5m plus. The club continues to function solely on handouts and the proceeds of returns on the pitch which are disproportionate to the funds allocated to team building.
Gate receipts will be drastically reduced this season with just the one European fixture and gates hovering around the 30,000 mark.
Finally, I’d like BK to explain exactly what support the board has given Moyes in the last 18 months. Same old bullshit whenever he sees something that he thinks can be perceived as good news. He’ll be back under his stone next year when a fall in turnover is announced.
Gate receipts will be drastically reduced this season with just the one European fixture and gates hovering around the 30,000 mark.
Finally, I’d like BK to explain exactly what support the board has given Moyes in the last 18 months. Same old bullshit whenever he sees something that he thinks can be perceived as good news. He’ll be back under his stone next year when a fall in turnover is announced.
Typical EFC under BK?s reign. Taking credit for money given to them by default. It's like when Wyness tried to take credit for EFC?s most profitable year ever ? when we just sold the greatest product of our youth system for a generation.
We sell McFadden for £5M a year ago, sell AJ for £10M in the summer and Moyes spends £15M on a midfielder. We aren't progressing, we just tread water. Brian Clough once said, "You always buy before you sell". With BK in charge we sell, sell and then buy. We never build, we just replace like for like. All because we have no fuckin money and no outside investment.
We sell McFadden for £5M a year ago, sell AJ for £10M in the summer and Moyes spends £15M on a midfielder. We aren't progressing, we just tread water. Brian Clough once said, "You always buy before you sell". With BK in charge we sell, sell and then buy. We never build, we just replace like for like. All because we have no fuckin money and no outside investment.
How many Prem clubs have had major outside investment in the last 8 years? At a guess I?d say the majority. Certainly the top 10 of English football -except us. Fucking joke of a club, that's what we?re becoming.
The debts may have risen to £66 mill in this set of accounts but I would doubt that is our true debt... Does anybody know if the rumours that we acquired an extra £30 mill since May are true? If so, this would take our debt close to £100 mill...
"Sensible and careful fiscal management" ? Where does this man get his brass neck.
"Sensible and careful fiscal management" ? Where does this man get his brass neck.
Ciaran
You ask if the rumours of an additional £30m debt are true, then answer your own question (in the way you want it to be answered), and criticise BK.
Maybe if you ask BK for a set of his most recent management accounts, you?ll find out if this "rumour" is true. Until then, maybe we shouldn?t just assume we have debts of £100m.
You ask if the rumours of an additional £30m debt are true, then answer your own question (in the way you want it to be answered), and criticise BK.
Maybe if you ask BK for a set of his most recent management accounts, you?ll find out if this "rumour" is true. Until then, maybe we shouldn?t just assume we have debts of £100m.
Okay then ? £66 million debt...
"Sensible and careful fiscal management" ? Where does this man get his brass neck?
[Is that ok?]
"Sensible and careful fiscal management" ? Where does this man get his brass neck?
[Is that ok?]
Perfectly ok, but out of context, given that, as discussed above, many of the assets of the football club, namely the players, are in the accounts at substantially below their current market value.
Given that the club is not allowed to revalue the players in the accounts to bring them in line with their current market value, the balance sheet is always going to show debt at a disproportionate ratio of assets, as these assets are below the true worth.
Player registrations are in the accounts at £39.4m - I suspect the true market value of our squad is at least double that.
An additional £50m on the value of the players would bring the debt level down to £16m, which I’m sure you’d agree is a lot more palatable than the £100m you started from.
[Is that ok?]
Given that the club is not allowed to revalue the players in the accounts to bring them in line with their current market value, the balance sheet is always going to show debt at a disproportionate ratio of assets, as these assets are below the true worth.
Player registrations are in the accounts at £39.4m - I suspect the true market value of our squad is at least double that.
An additional £50m on the value of the players would bring the debt level down to £16m, which I’m sure you’d agree is a lot more palatable than the £100m you started from.
[Is that ok?]
How does revaluing the players bring the debt down?
All that would do is create a notional increase in the intangible asset values (which I would suggest is not allowed under Financial Reporting Standard 10: Accounting for Goodwill and Intangible FIxed Assets) and then create a notional equity value in a Revaluation Reserve.
None of this could be realised until the player was sold at the supposed value placed on him.
All that would do is create a notional increase in the intangible asset values (which I would suggest is not allowed under Financial Reporting Standard 10: Accounting for Goodwill and Intangible FIxed Assets) and then create a notional equity value in a Revaluation Reserve.
None of this could be realised until the player was sold at the supposed value placed on him.
Simon
If you read my earlier posting, you would see that I specifically said that Everton are not allowed to revalue players, but thanks for reminding me of the exact FRS.
My point was that focusing entirely on a debt level of £66m, and ignoring the values of the assets which the club is not allowed to revalue due to the very FRS you quoted is disingenuous.
If you read my earlier posting, you would see that I specifically said that Everton are not allowed to revalue players, but thanks for reminding me of the exact FRS.
My point was that focusing entirely on a debt level of £66m, and ignoring the values of the assets which the club is not allowed to revalue due to the very FRS you quoted is disingenuous.
I think that any of us suggesting that we understand the financial position of the club based on a single set of accounts without reference to other industry accounts is a waste of time and effort.
What I was questioning was your specific assertion that "An additional £50m on the value of the players would bring the debt level down to £16m"
I?m not an expert but I don?t see how this works. Until the debt is paid the debt levels remain the same. I agree the ratios of debt to assets would change but this does not bring the debt down. Until the asset value is realised by a sale, and the cash generated from the sale is used to reduce the debt the debt remains the same. Additionally this would have the effect, I think, of creating a revaluation reserve which would be realised on the sale of the player at this supposed market value. On realisation this would then become part of the P&L reserve which, if it is a credit balance, would be a liability to the shareholders. This the debt to a bank becomes a debt to Bill Kenwright et al.
Moreover, just because players have a notional market value does not mean that that value would be achieved. This is particularly the case in volatile industries where asset values are subject to fluctuations.
What I was questioning was your specific assertion that "An additional £50m on the value of the players would bring the debt level down to £16m"
I?m not an expert but I don?t see how this works. Until the debt is paid the debt levels remain the same. I agree the ratios of debt to assets would change but this does not bring the debt down. Until the asset value is realised by a sale, and the cash generated from the sale is used to reduce the debt the debt remains the same. Additionally this would have the effect, I think, of creating a revaluation reserve which would be realised on the sale of the player at this supposed market value. On realisation this would then become part of the P&L reserve which, if it is a credit balance, would be a liability to the shareholders. This the debt to a bank becomes a debt to Bill Kenwright et al.
Moreover, just because players have a notional market value does not mean that that value would be achieved. This is particularly the case in volatile industries where asset values are subject to fluctuations.
Simon, when I used those words, in my mind, I was referring to net debt, and was allocating the additional value created by revaluing the players (again, I know this is not allowed!) against the headline debt figure of £66m, as an attempt to demonstrate that focusing on one and ignoring the other was, in my words, taking it "out of context" (and as an accountant, I am aware of the accounting entries involved).
As someone who clearly has some accounting knowledge too, I am sure you can appreciate this point.
As someone who clearly has some accounting knowledge too, I am sure you can appreciate this point.
Sorry Bob,
Looks like I misunderstood your point. I thought you were refering to the specific debt. I take it you were refering to the net asset / liabilities position?
Looks like I misunderstood your point. I thought you were refering to the specific debt. I take it you were refering to the net asset / liabilities position?
No problem, Simon, I obviously didn’t clarify myself very well, but it was the net position I was trying to emphasise.
I think we’ve turned this thread into Accountants’ Corner!
I think we can agree though that the balance sheet isn’t the most accurate reflection of the financial position of the club, given the lack of detail published, and also the fact that the assets in the balance sheet don’t necessarily reflect the current value.
I think we’ve turned this thread into Accountants’ Corner!
I think we can agree though that the balance sheet isn’t the most accurate reflection of the financial position of the club, given the lack of detail published, and also the fact that the assets in the balance sheet don’t necessarily reflect the current value.
Simon says... Until the asset value is realised by a sale, and the cash generated from the sale is used to reduce the debt the debt remains the same.
I?m glad you clarified that but if the sale of the assets (players) brought the debt down to £16 mil as Bob states then just who do we use to play football with?
I?m glad you clarified that but if the sale of the assets (players) brought the debt down to £16 mil as Bob states then just who do we use to play football with?
Ok but irrelevant, Bob...
Unless you're suggesting the scenario will arise that we will be selling all our players to offset the debt, then your point is irrelevant.
The player asset values are not solid or tangible figures in accounts for a reason... the debt however is.
Is that ok?
Unless you're suggesting the scenario will arise that we will be selling all our players to offset the debt, then your point is irrelevant.
The player asset values are not solid or tangible figures in accounts for a reason... the debt however is.
Is that ok?
So you think showing Arteta in the accounts as £250k (similarly Tim Cahill) is a fair reflection of the value of the assets owned by the company then?
The level of debt is relevant to the extent of (a) the level of interest payments made on it, and our ability to service them, and (b) the extent to which the creditors are happy to continue to receive interest (which presumably is how they make profit on the loan) and not instantly demand full payment of the loan (if indeed they are entitled to do this).
The businesses who have made loans to Everton will be happy to continue to receive their interest payments as long as they feel that, if push comes to shove, the club has the assets to pay the balance of the loan if they have the need or right to demand full payment of it. The value of assets shown in the accounts is not a reflection of the value of those assets, which would be realised in order to pay the debt. Of course, this would mean players would have to be sold, but only if the creditor had the right to call in the debt, and also if they felt that this was the only way to recover their loan.
The level of debt is relevant to the extent of (a) the level of interest payments made on it, and our ability to service them, and (b) the extent to which the creditors are happy to continue to receive interest (which presumably is how they make profit on the loan) and not instantly demand full payment of the loan (if indeed they are entitled to do this).
The businesses who have made loans to Everton will be happy to continue to receive their interest payments as long as they feel that, if push comes to shove, the club has the assets to pay the balance of the loan if they have the need or right to demand full payment of it. The value of assets shown in the accounts is not a reflection of the value of those assets, which would be realised in order to pay the debt. Of course, this would mean players would have to be sold, but only if the creditor had the right to call in the debt, and also if they felt that this was the only way to recover their loan.
Without knowing the full terms and conditions of these loans, no-one here is in a position to counter the club?s statement about "sensible and careful fiscal management". As long as Everton are in a position to service the payments, the creditors will continue to be happy to receive the interest thereon.
It is only the accounting principles of prudence and historic cost accounting which prevent clubs revaluing players? values in line with current market conditions ? and if the balance sheet had an additional £50/75m worth of assets on it, I suspect we wouldn?t be having this discussion.
Given that it is unlikely that all £66m will be demanded to be paid immediately, then the level of debt is as relevant (or irrelevant) as the value of the players not being recorded in the accounts.
Ciaran,
I think the key point here is that people on this thread are using the accounts as a vehicle to bash Bill (and I?m not defending him here, he could be as evil as a nasty vampire for all I know). However, to criticise him based on figures taken in isolation from the accounts is not necesarily fair. For example, you are taking the debt figure in isolation without considering the wider implications of the entire financial statements and the relationship with other figures.
I could do the same with Arsenal. As per their group accounts year end 31 May 2007, their figure for creditors (debt) due within one year is approx £150 million. The creditors due after more than one year is approx £416 million according to their published accounts. £556m of debt at Arsenal but I doubt you?d say they are finacially mismanaged. This is most likely because you don?t care and therefore don?t have an agenda with Arsenal.
Without comparing and contrasting the accounts of EFC with those of other football clubs, and without comparing that debt to other elements of the accounts, it is ridiculous to imply that the club is mismanaged based on that isoloated figure.
Erik, Re: Players I guess that?s a decision for the management of EFC. Or our imminent administrators if you?d believe the doomsayers on this thread.
I think the key point here is that people on this thread are using the accounts as a vehicle to bash Bill (and I?m not defending him here, he could be as evil as a nasty vampire for all I know). However, to criticise him based on figures taken in isolation from the accounts is not necesarily fair. For example, you are taking the debt figure in isolation without considering the wider implications of the entire financial statements and the relationship with other figures.
I could do the same with Arsenal. As per their group accounts year end 31 May 2007, their figure for creditors (debt) due within one year is approx £150 million. The creditors due after more than one year is approx £416 million according to their published accounts. £556m of debt at Arsenal but I doubt you?d say they are finacially mismanaged. This is most likely because you don?t care and therefore don?t have an agenda with Arsenal.
Without comparing and contrasting the accounts of EFC with those of other football clubs, and without comparing that debt to other elements of the accounts, it is ridiculous to imply that the club is mismanaged based on that isoloated figure.
Erik, Re: Players I guess that?s a decision for the management of EFC. Or our imminent administrators if you?d believe the doomsayers on this thread.
Ciaran,
Is there ever a thread when you haven?t moaned? There are a number of people on this site who moan sooooooo much, don?t do anthing othan than. Fuckin chill out will you.
Is there ever a thread when you haven?t moaned? There are a number of people on this site who moan sooooooo much, don?t do anthing othan than. Fuckin chill out will you.
This is not the first time you’ve seen fit to moan about me moaning Damian.
That irony lost on you?
That irony lost on you?
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1 Posted 17/12/2008 at 12:36:04
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