FFP again

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QPR_John
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FFP again

Post by QPR_John » Mon Apr 30, 2018 8:25 am

Can anybody tell me the difference in FFP terms between the debt our owners have written off and the reported debt of £137M written off by Ellis Short.

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UxbridgeR
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Re: FFP again

Post by UxbridgeR » Mon Apr 30, 2018 12:37 pm

He's "writing off" historic debt, as we did with the £180M that was converted into equity in the 2015-16 accounts.

If you're comparing it to the £60M that we are in dispute with the FL over, the issue there was that we tried to write it off in the P&L in the same year the debt was incurred, in order to reduce our FFP liability.
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Esox Lucius
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Re: FFP again

Post by Esox Lucius » Mon Apr 30, 2018 12:38 pm

"By agreeing to pay off all Sunderland’s debt in order to facilitate a takeover by a consortium led by Eastleigh chairman Stewart Donald, Short has agreed to write off more than £100m.

Sunderland’s latest set of accounts, which cover the period to July 31, 2017, are due to be released later this week, and are expected to show that the club’s total debt rose slightly from the figure of £110.4m that was quoted in the previous year’s figures.

Around £70m of that figure was owed directly to Short, with the Irish-American financier having put in an extra £19.5m in the form of an interest-free loan during Sunderland’s final season in the Premier League to ensure that day-to-day expenditure could be met. Short will not see any of that money again, and has also settled the £50m-or-so that Sunderland owed in the form of an external bank loan.

Since taking over from the Drumaville consortium in 2008, Short has already written off more than £100m by capitalising a large chunk of the money that was initially loaned during the early years of his reign. Throw in the money that was paid to actually buy the club in the first place, and there is every chance that his total losses during his spell as Sunderland chairman will exceed £250m. That is quite some sum."

I would hazard a guess that it is debt accumulated over 10 years in the Premiership the FFP regulations would only apply to monies spent since they dropped out and would be subject to the same 3 year rolling expenditure that all clubs are permitted.
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QPR_John
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Re: FFP again

Post by QPR_John » Mon Apr 30, 2018 12:44 pm

UxbridgeR wrote:
Mon Apr 30, 2018 12:37 pm
He's "writing off" historic debt, as we did with the £180M that was converted into equity in the 2015-16 accounts.

If you're comparing it to the £60M that we are in dispute with the FL over, the issue there was that we tried to write it off in the P&L in the same year the debt was incurred, in order to reduce our FFP liability.
Surely owners writing off debt and not putting it onto the club is what FFP was designed for.

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UxbridgeR
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Re: FFP again

Post by UxbridgeR » Mon Apr 30, 2018 1:11 pm

Well we could debate the efficacy of FFP for the 133rd time, but I doubt it would change anything.

The rules were pretty clear. We broke them. Sunderland didn't. That's the difference.
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Re: FFP again

Post by QPR_John » Mon Apr 30, 2018 1:34 pm

UxbridgeR wrote:
Mon Apr 30, 2018 1:11 pm
Well we could debate the efficacy of FFP for the 133rd time, but I doubt it would change anything.

The rules were pretty clear. We broke them. Sunderland didn't. That's the difference.
I agree but just pointing out the lack of thought of whoever decided something had to be done to protect clubs from themselves. The very idea of a financial penalty for being financially imprudent beggars belief especially when there are a myriad of other penalties available

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