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So here it is ....

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In layman's terms.......................are they Fooked or wot?
 
HBSAFC said:
Haha. Would bet you any amount of money I went to more safc matches last season than you?



Wasn't being totally serious but still think to type up loads about their finances a bit sad.

When did finances become so important for fans anyway? It a new breed of modern fan in my opinion.
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To an extent I agree I’ve always been one of the first to say I’m a football supporter and not an accountant but @Grumpy Old Man ’ s analysis makes it understandable for my brain and I find them interesting
 
Grumpy Old Man said:
I was asked by a large number of people here to do it; that was the only reason I wrote it. I had to write a lot because there was a lot to write about. As for a bit sad, it was my job; writing stuff like this helps keep my hand on as much as anything else.
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Fair enough

Mags' finances (or any team's finances tbh) doesn't interest me though.
 
Grumpy Old Man said:
Not Merry Christmas, but the Grumpy take on the Mags accounts.

So, what does a trawl through the Mags latest accounts tell us?

Perhaps the most important thing is that it’s probably a terrible idea to get into a poker game with Fat Mike. He’s basically bet the farm on getting first time promotion and, to be fair, it’s come off. However, if they had done what Villa just did, they’d be looking straight down the barrel.

As it is, there’s more than enough going on here to suggest that it’s very far from all sweetness and light for them.

First amber light comes on the first page – corporate governance; they have one director. If old MBH twisted for days on here about our lack of proper board meetings, God know how the Mags can do it with only one director. Of course, these are legal niceties; Ashley will surely have some influence, and that could make him a shadow director in legal terms (I’m having to choose words carefully here). There are potential ramifications to that, which, again, I can’t really expand on without a risk of overstepping fair comment.

Second amber light – trading performance. This is where the farm has been bet. They incurred a trading loss of £55m – that’s the loss before player contract amortisation and profit or loss on transfers, contrasted with a £29m trading profit the year they were relegated. A fall in turnover of £40m can’t really be called unexpected, although a halving of commercial income from £25m to £12.5m speaks volumes about the attractiveness of Championship football to sponsors. The surprise comes in the increase of the cost base. Far from cutting costs to match the drop in status and turnover, they actually increased employee numbers and operating costs in all areas, with a 50% increase in the wage bill. They will no doubt claim this is inflated by promotion payments, which indeed it is; but only to the tune of £10m (which is hidden in the small print of the director’s strategic review, rather than in main accounts and notes). That leaves them re-entering the PL with a wage bill 38% higher than when they left, before any transfer activity last summer. Of course, the commercial income will bounce back, and, with a PL payment of around. Now there is another possible explanation for the increase in wages, which we’ll come to at the end, which would mean that the increase is a little bit of an illusion.

Next up – profit/loss before tax and FFP.

A bit of good news for them. They’re safe under FFP, primarily because they had two good years in 2014/15 and 2015/16, which offset the current loss, and being able to exclude player amortisation from the calculation of allowable losses, although, curiously profit/loss on transfers is included. The regulations themselves don’t help – they’re long and more than a bit ambiguous. If you like being tied up in logical knots, or prefer a non-pharmaceutical remedy for insomnia, the EFL regulations are here
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. It’s not helped by the rules changing from 2016/17 onwards.

Cash flow – they’re still leaking cash, but not nearly as badly as in the previous season, where they burned through huge amounts trying to stay up. Their cash flow should improve however, as it looks like they’ve been offering very generous terms on players they’ve sold. They have £61m owed to them by other clubs, £38m of which isn’t due till next season. This is far higher than amounts they owe other clubs. The cash flow was improved by a £15m increase in loans form Ashley, you know, the man who never puts a penny of his own money in.


And a final little kicker. In the cash flow statement, there’s a curious line – increase In provisions
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sorry didn't mean to quote only to like .........fat fingers on iPad strikes again
 
HBSAFC said:
Haha. Would bet you any amount of money I went to more safc matches last season than you?



Wasn't being totally serious but still think to type up loads about their finances a bit sad.

When did finances become so important for fans anyway? It a new breed of modern fan in my opinion.
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Unfortunately in this day and age of huge tv revenues finances and the information we are afforded with from the internet club finances gave become hugely important and to an extent interesting.
To call GOM our version of Michael Martin is very disingenuous. He was asked to have a look at the mags accounts by us mere mortals who don't understand the balance sheet as well as he does and he's done a very fair and unbiased job of it.
 
phunboy said:
Unfortunately in this day and age of huge tv revenues finances and the information we are afforded with from the internet club finances gave become hugely important and to an extent interesting.
To call GOM our version of Michael Martin is very disingenuous. He was asked to have a look at the mags accounts by us mere mortals who don't understand the balance sheet as well as he does and he's done a very fair and unbiased job of it.
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Just my opinion but not interesting in the slightest, I don't even understand it.

Football is about matches, not "balance sheets"
 
HBSAFC said:
Just my opinion but not interesting in the slightest, I don't even understand it.

Football is about matches, not "balance sheets"
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But a healthy balance sheet helps produce a decent budget which the helps produce a better quality team. Tip the balance too far the wrong way and as we have just found out it has a major impact on the quality of football a club can produce.
I understand we as supporters are primarily interested in what happens on the pitch but it also helps to understand why its happening the way it is.
 
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