Financial Fair Play (FFP)

[Robertson]

Here's how the speculation goes, that even Keiran Maguire is indulging in.

Breach
First, let's seperate the breach from the punishment, and deal with the former as a standalone event.

Did they breach the current 3-year period. Yes.

Next, now let's look at the punishment, assuming the commission's calculation model for Forest's is a benchmark.

Initially, they would get 3pts for the breach.

Extent
Subsequently, there is a question of extent. This is where the so-called double-jeopardy would come in. Everton already received a punishment that covered the first two years of the current 3-year period.

If Everton's second commission follows this logic of double jeopardy, then they have two probable options
- treat the 3 year breach as an extent and reduce the punishment for the extent only to two thirds
- only view the last year's breach as the extent.

Both would likely follow the punishment model from Forest's commission, which they offered up an arbitrary banding where Forest, on £34m, was considered 'significant'.

Posters will want to argue whether Everton's breach is more significant than Forest's but I'm not concerned with that fact here. I just assuming, for arguments sake and demonstration purposes, that Everton's is also considered significant and worthy of a further 3pts.

If the panel chose the first method - 3 years and reduce punishment to 2/3rds - then it probably gets 1pt here. If they chose just to measure the extent of the last year, it depends on the extent. The figure of £89m is bandied about, but is that the PSR loss? In theory, even though they are only considering the most recent year if the extent is also significant it could be 3pts, too.

Mitigation and Aggravation
Finally, the punishment might be amended downward (or, upwards but unlikely) depending on the assessment of the mitigation and aggravating factors. The second breach would be seen as an aggravating factor and could be balanced off of any mitigation like compliance.

Whether they do it not, or you agree with it not, that's how I have understood the proposed model FROM SPECULATION ONLINE

Alright, suppose that 1 point deduction for Everton does come to pass. Then that sets a precedent for the worst case scenario of what should happen to Forest next season. One point.

And in that case there’s little or no incentive to rush through any further sales in June.

While accepting the need to make some sales over the summer as a whole to balance the books in the longer term.

 

[redodare]

I was in agreement with you a couple of weeks ago but I've changed my mind now.
I want us to stay up, build and start to really get under the skin of the top 6 corporate crew..

Exactly my position.

And the PL's "rules" are dictated by the Premier League clubs .The proposed change away from penalty points needs approval from 75% of the current clubs. Our recent history is to vote with the larger clubs. We want to be part of that group.

If we're relegated , we'll have to sell more players than if we stay up, or risk bigger penalties. With the rules as they are the player sale market will be even more depressed. Only the bigger more commercial clubs will be able to spend and they'll pick up bargains.

Best we pick up points and stay up.

 

[DB1702]

Finance is not my area of expertise but from everything I have seen and read about FFP I feel as if we have been punished for being naive with our accounts reporting and not having as good accountants as other teams.

Having seen the numbers other teams have posted it makes no sense how they have not breached FFP. All I can assume is because those teams know the system and have accountants who know the system they have got away with breaching.

Kieran Maguire on talksport early in the new years did kinda of allude to the EPL waving teams accounts through and not examining them if they have no history of breaching or are established EPL clubs. He also stated a team like Forest because we are new would have our accounts examined in more detail than established EPL clubs.

I fully understand we have broke the rules even if the rules are a joke. But what feels unfair if I feel others have likely got away with breaching but because they have got better accountants have got away with it.

We lost 4 points that could be the difference between playing Arsenal away next year or no disrespect but Stoke City away.

If us and Everton were given our points back then the relegation issue would be pretty much done. We would be 7 points clear of Luton with a better GD and 9 points ahead of Burnley with a better GD and 13 points ahead of Sheff Utd with a better GD.


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[Redemption]

Our recent history is to vote with the larger clubs. We want to be part of that group.

Since this 'declaration' Forest recently voted against the larger clubs on multi-club transfers and was in a split group voting against extended solidarity payments. The latter vote didn't have big 6 unity.

 

[Redemption]

the EPL waving teams accounts through and not examining them if they have no history of breaching or are established EPL clubs

I don't beleive this to be true. If it was true, it would a be a breach of EPL rules and clubs like Forest and Everton would take them to court. Why would they f*** about with the appeal process?

 

[Shearstone]

Can someone explain to me how Double jeopardy is a factor here?

It's a 3 year rolling period. So they a season to generate revenue by selling players to reach a profit on last seasons accounts to mitigate their losses from the previous 2 years. Instead they didn't and are still in breach. So surely they should get hit with the same punishment again? It's just down to Premier League fuckery that they'll get hit twice this season but I don't see how they can call it double jeopardy?

 

[Redemption]

Can someone explain to me how Double jeopardy is a factor here?

It's a 3 year rolling period. So they a season to generate revenue by selling players to reach a profit on last seasons accounts to mitigate their losses from the previous 2 years. Instead they didn't and are still in breach. So surely they should get hit with the same punishment again? It's just down to Premier League fuckery that they'll get hit twice this season but I don't see how they can call it double jeopardy?

Here's one I made 20 minutes ago

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forestforum.co.uk

 

[Shearstone]

Here's one I made 20 minutes ago

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forestforum.co.uk

Cheers but doesn't answer it for me.

You're saying they have already received the punishment for the first 2 years, but they didn't. They received a punishment for the previous 3 years. They're breaching now because they've not addressed that fact the season after and are once again in breach but for the next rolling 3 years. If they survive and next season still post a rolling 3 year loss above £105million I would expect them to get hit again. Same for us and our what is it 80million next season?

 

[Senior Flange Technician]

The problem there is, most companies are set up with limited liability, so the „debt“ ends up with the company, not the nominated Director (which under UK company law, is how it works).

So - for a bad example - were such a rule in place, „Big“ Evangelos could just let „Nottingham Forest Football Club Ltd.“ rack-up tens of millions in debt, and if that debt became unserviceable - for example, in the event of relegation - he could in theory, just walk away and let the „company“ become insolvent and be liquidated.

This was what (very nearly) happened with the sheep-shaggers; had not the bloke who bailed them out stepped in, Mel Morris could have just allowed the company to be wound-up, with very little personal risk to himself (granted, that would have been f***ing hilarious, but there you go).

Not that I am in any way suggesting that Evangelos would do such a thing (I am sure he would not) but it is very difficult to make individual Directors responsible for financial liabilities of a company, unless it can be legally proven that they have (for example) acted fraudulently, or traded whilst insolvent - the current ongoing court case between Hewlett-Packard and the (former) Director of Autonomy, Mike Lynch, is relevant here, as HP claim he fraudulently inflated the value of Autonomy to HP, so he could sell it to them for billions and make a fat profit; Lynch maintains the value was fair, and HP dropped the ball by allowing over half the management team to leave after they bought it, and then the rudderless company basically collapsed, forcing HP to have to write-down its value by about 8Bn dollars.

I understand the law around limited companies. it's why I'd not let limited companies own football clubs.

Everyone in football says its not like any other business, so why shouldn't it have laws governing it as such?

Just have a guarantee account with that amount of money in or, like the bumdesliga a plan if where the monies coming from.

All FFP/PSR does is limit ambition. it's not stopped one club going bust, which was meant to be the aim. Let billionaires waste money but don't let them leave the fans and club on it's arse when they got bored or ficked up too much to sort it out.

 

[Est.1865]

Exemptions should not be made re double jeopardy.

If they introduce stupid f***ing rules that specifically cover a rolling 3 year period, then that’s a natural by-product.

Simply another reason to question the merits of the rules in the first place.

 

[Redemption]

they have already received the punishment for the first 2 years, but they didn't. They received a punishment for the previous 3 years

Forest's case is the clearest. We received two seperate components of the punishment: 3pts for the breach, 3ts for the extent. The, additionally, -2pts for mitigation.

In Everton's case, they have breached again. That is not in doubt. The issue is the extent and whether the previous punishment covers part of the current extent.

The current 3 year period, includes the last two years of the first breach.

If there is to be a so called double-jepardy defence in this process, it is around those two years that overlap. Or at least that's the speculation of how it might work.

Ss far as I have been able to understand it, that'sthe explanation.

Fair, just, complete bollocks, whatever. It could be just like the no-appeal plea bargain and be just speculation.

 

[coops89]

Finance is not my area of expertise but from everything I have seen and read about FFP I feel as if we have been punished for being naive with our accounts reporting and not having as good accountants as other teams.

Having seen the numbers other teams have posted it makes no sense how they have not breached FFP. All I can assume is because those teams know the system and have accountants who know the system they have got away with breaching.

Kieran Maguire on talksport early in the new years did kinda of allude to the EPL waving teams accounts through and not examining them if they have no history of breaching or are established EPL clubs. He also stated a team like Forest because we are new would have our accounts examined in more detail than established EPL clubs.

I fully understand we have broke the rules even if the rules are a joke. But what feels unfair if I feel others have likely got away with breaching but because they have got better accountants have got away with it.

We lost 4 points that could be the difference between playing Arsenal away next year or no disrespect but Stoke City away.

If us and Everton were given our points back then the relegation issue would be pretty much done. We would be 7 points clear of Luton with a better GD and 9 points ahead of Burnley with a better GD and 13 points ahead of Sheff Utd with a better GD.


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The Premier League has become a bit of a theatre this year with VAR cock ups and the points deductions. It’s crafted a title race and a relegation battle. So the cynic in me says anyway.

 

[Est.1865]

If a team has incurred losses of 40mil per year for the last 3 years, total 120mi and therefore a 15mil breach.

They should also be held accountable to incure losses under 25mil in the next year to ensure the 105mil limit isn’t exceeded.

It’s not double jeopardy at all. It’s the very premise of a rolling multi year period rule.

 

[Robertson]

If a team has incurred losses of 40mil per year for the last 3 years, total 120mi and therefore a 15mil breach.

They should also be held accountable to incure losses under 25mil in the next year to ensure the 105mil limit isn’t exceeded.

It’s not double jeopardy at all. It’s the very premise of a rolling multi year period rule.

At the very least, they need to have made made losses less than £35m in the third year for the double jeopardy to hold any water at all. Rather than, say, an £89m loss, as Everton have.

Though I believe their "PSR loss" could well be somewhat smaller than this, since evidently if you're an established Premier League club you get to wave away tens if not hundreds of millions of pounds in losses for some reason.

For comparison, Forest could easily break even this season and still find themselves with a charge, because of the three year rolling window.

 

[Otis Redding]

Yeah, but they didn’t say which year.

Obviously for Man City, it will coincide with the year when the PL grant a P&SR amnesty to all of its clubs.

With city and Newcastle, the PL should have refused to allow government ownership of clubs.

The pl has sown the wind, and it is on the brink of reaping the whirlwind

I saw a report (BBC I think) claiming that the incoming government Football Regulator will be agreeable to foreign state ownership of English clubs as long as that model fully complies with prevailing ownership rules.

 

[Strummer]

Or of course, a team is perfectly able to lose 120m, as long as they sell 15m worth of players in that same time to offset the „gap“.

 

[Redemption]

Obviously it will coincide with the year when the PL grant a P&SR amnesty to all of its clubs.

I saw a report (BBC I think) claiming that the incoming government Football Regulator will be agreeable to foreign state ownership of English clubs as long as that model fully complies with prevailing ownership rules.

I think the closer the regulator gets to reality the more we'll understand its not really going to solve ownership issues, where it has some remit, nor FFP/PSR, where it wont have any remit.

The Secretary of State confirmed this recently.

 

[Otis Redding]

I think the closer the regulator gets to reality the more we'll understand its not really going to solve ownership issues, where it has some remit, nor FFP/PSR, where it wont have any remit.

The Secretary of State confirmed this recently.

I've checked where I saw it and it was on a BBC News report. So, we'll just have to see.

 

[derbyshirered]

Everton announcement?

 

[Louth Red]

I don't beleive this to be true. If it was true, it would a be a breach of EPL rules and clubs like Forest and Everton would take them to court. Why would they f*** about with the appeal process?

The issue here is that several clubs promoted from the Championship have seriously breeched EFL FFP limits. They have then agreed a compensation package with EFL which has been very modest compared to the size of the breech.
EPL has been silent on this until the current issue with Leicester.
What is needed is a agreement between EPL & EFL - but this is unlikely given the failure to agree the six year compensation broadcast package.

 

[Redemption]

The issue here is that several clubs promoted from the Championship have seriously breeched EFL FFP limits. They have then agreed a compensation package with EFL which has been very modest compared to the size of the breech.
EPL has been silent on this until the current issue with Leicester.
What is needed is a agreement between EPL & EFL - but this is unlikely given the failure to agree the six year compensation broadcast package.

Is there a difference between letting clubs off, which was rhe allegation I was responding to, and doing it on the quiet?

 

[Redemption]

Burnley next up in the FFP parade?

I don't know the veracity of this story, but here's the link (it uses a lot of speculative language)

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www.caughtoffside.com

 

[Bing Crosby's Head]

Burnley next up in the FFP parade?

I don't know the veracity of this story, but here's the link (it uses a lot of speculative language)

Loading…

www.caughtoffside.com

That's only if they get relegated. They made a profit in 2022 and a small loss in 2021 so are comfortable versus FFP at the moment but will struggle to meet it in the Championship.

 

[Robertson]

That's only if they get relegated. They made a profit in 2022 and a small loss in 2021 so are comfortable versus FFP at the moment but will struggle to meet it in the Championship.

I would stick my neck out and say there's an outside chance they might get relegated though.

 

[Louth Red]

Is there a difference between letting clubs off, which was rhe allegation I was responding to, and doing it on the quiet?

The real issue has been the indifference of EPL to promoted clubs exceeding EFL spending limits until this season with Leicester.
In essence this means promoted clubs have been let off by only paying a fraction of their excess losses. Some of those clubs will argue that they have not done it on the quiet.