He wasn't too far wrong about any of that though was he?
Bore off Pete.
As you well know, I am not Pete and have never even met him.
How would anyone know that? I know that you have lied to me, you behave like an attention seeking troll, and it's impossible to judge you on anything but what you write.
Which means that nobody with half a brain is going to take your assertions at face value.
The cash payments have no bearing on the p&l
Eg
A player is bought for £10m on a 5 year contract. £4 million upfront. £3m in 6 months the following £3m after 12 months.
Dr Player asset £10m
Cr bank £4m
Cr Creditors £6mSo you have a £10m asset, £4m less cash and you owe £6m.
When the stage payments are made cash and creditors both go down. No P&L impact.
Each year the P&L is charged £2m this is the P&L impact
Right. So why is it okay to charge the P&L spread over five years, at £2M a year, when I have paid £4M (plus £3M maybe also in this accounting period) this year, and next year the player might be worth nothing?
What impact depreciating player value towards end of contract?
Yes, exactly that.
Thank you Mel Morris.
Nothing, that was the Derby argument. (Re increasing values)
Although if long term injured or career over you may have to take a bigger hit.
This is roughly what I also think (hope).
The regulator has passed the case to the independent commission to evaluate mitigation and set an appropriate level of sanction. They dismissed all of Everton's mitigation in the previous case. Did you see that quote I posted from the ruling, where any excess over the limit should be considered egregious? We are believed to be in the order of tens of millions over the limit. Everton's case appears to hinge on whether interest payments on infrastructure payments are allowable or not.
If you observed our dealings it was impossible to conclude that we were not in P&S trouble, even with some, ahem, creative dealing. Almost everyone said that was not going to be the case when it was pointed out.
It is now de-facto the case.
Where have you seen that we are tens of millions over?
About what?
If I understand your question,
You bought him for 10m for 5 years and thus expect he will deliver 2m of value to you every year, until at the end of year 5 he has no value.
You depreciate assets over their useful life, which for footballers seems to be accepted as the length of contract you've given them. Can pick holes in that principle but it's probably the best approach all things considered.
@Lessred am loving the debits and credits. Draw some T accounts and I think your work here is done.
You laugh but we do sometimes still use them when we are doing control accounts.
A couple of old clients even still do handwritten ETB's
