Man City announce £195m loss

[JerryGarcia]

http://www1.skysports.com/football/news/11679/7315176/City-announce-record-losses

Premier League leaders Manchester City have announced record losses of £194.9million for the 2010-11 financial year.

The huge sum, which is the highest-ever recorded in English football, demonstrates the level of the investment made by owner Sheikh Mansour.

Fortunately for the club, UEFA's new Financial Fair Play regulations fall outside the accounting window, meaning the losses will not count towards their participation in European competition.

Eek

Well this isn't really a surprise but if they can get around the financial fair play rules with a loss like that then what's the point in having the rules in first place?

Surely if the top clubs are immune to the regulations then this only serves to keep the lower league teams in their current places. I guess we knew this already but to see such a loss declared really brings it home that football is headed in the wrong direction.

Thank the lord that we have Sep Blatter in charge, if anyone can fix this then he can. :-|

 

[yawa]

Pretty sure the financial fair play rules haven't kicked in yet and that's why some clubs have spent so much in the last 12 months. It won't be able to continue in the next few years.

 

[kishman]

Pretty sure the financial fair play rules haven't kicked in yet and that's why some clubs have spent so much in the last 12 months. It won't be able to continue in the next few years.

Yes that's correct, the FFP rules kick in the next year.

But even so they'll need a mircale to break-even but some how the Arabs will some how crawl their way out of it.

 

[mpickard2087]

Amazing. Wages as a percentage of turnover is off the scale! Even with Sponsorship and CL money coming in it will take some turning round to break even.

 

[tototoner]

The fair play rules will sort this out, yeah right

 

[3Dnata]

I think we'll find that the Fair Play they have in mind is if someone gives Eufa an envelope/suitcase with a couple of million in it won't be a problem.

 

[JerryGarcia]

Pretty sure the financial fair play rules haven't kicked in yet and that's why some clubs have spent so much in the last 12 months. It won't be able to continue in the next few years.

Maybe I have this wrong but when they announced the fair play rules, I'm sure they said that they would take into account the current and last season?

I thought they would start enforcing it next year and teams would have to balance their books well before that happened.

 

[davidmatzdorf]

What the article in the Guardian says is that the FFP rules, when they start in 2014/15, take into account the previous three years of accounts, which means that the first set of accounts that "count" are 2011/12.

What I reckon has happened here is that Man City have arranged for their auditors to pile as high a loss as possible into the 2010/11 accounts, to make the 2011/12 accounts look better and thus give them a chance of complying.

Thus the headline figure of £191m losses is likely to be distorted - higher than necessary. I'm a bit surprised the article didn't mention this probability.

 

[JerryGarcia]

What the article in the Guardian says is that the FFP rules, when they start in 2014/15, take into account the previous three years of accounts, which means that the first set of accounts that "count" are 2011/12.

What I reckon has happened here is that Man City have arranged for their auditors to pile as high a loss as possible into the 2010/11 accounts, to make the 2011/12 accounts look better and thus give them a chance of complying.

Thus the headline figure of £191m losses is likely to be distorted - higher than necessary. I'm a bit surprised the article didn't mention this probability.

That makes more sense, thanks for clearing that up.

Of course, the whole thing is a sham since they're effectively sponsoring themselves. I just hope that's taken into account when a decision is made.

 

[nightgoat]

Even so, according to the Guardian their wage bill for that financial year was £21m higher than their turnover. Consider then the transfer fees and additional wages for Nasri, Aguero, Clichy - they're going to have to go some to bring that down to a loss of just £38.5m over three years.

Of course they will, through dodgy accounting, sidestepping, loopholes and UEFA's ultimate lack of enforcing their own rules...

 

[RussellYid]

My wages have nothing to do with this...

 

[sim0n]

as long as they slaughter newcastle today, they can spend all they like...

we all know money talks and suckers walk "fair play" rules will be manipulated by wealthy owners through wealthy solicitors.

:hello:

 

[RichieS]

Even so, according to the Guardian their wage bill for that financial year was £21m higher than their turnover. Consider then the transfer fees and additional wages for Nasri, Aguero, Clichy - they're going to have to go some to bring that down to a loss of just £38.5m over three years.

Of course they will, through dodgy accounting, sidestepping, loopholes and UEFA's ultimate lack of enforcing their own rules...

This is what I don't quite understand about the rules - UEFA run the risk of having the Champions League without (particularly) Real Madrid and Barcelona. Are they prepared to stick by their rules and let that happen?

 

[Lilbaz]

This is what I don't quite understand about the rules - UEFA run the risk of having the Champions League without (particularly) Real Madrid and Barcelona. Are they prepared to stick by their rules and let that happen?

The rules benefit them the most aswell as utd as they have the biggest turnovers. It stops smaller teams from competing as they can spend less.

 

[RichieS]

The rules benefit them the most aswell as utd as they have the biggest turnovers. It stops smaller teams from competing as they can spend less.

Kinda, although limiting spending to a percentage of turnover is the only really fair way to introduce spending caps. In the case of those two however, their turnover is massively skewed by the disproportionate amount of TV revenue they receive. This is something that UEFA should definitely be having a look at if they truly want to create a level financial playing field.

 

[sweetness]

Wage contracts signed up until June 2010 aren't included in FFP.
We can therefore safely assume that Citeh "only" lost somewhere in the range of £70-120m according to FFP.

Add the new "commercial" deals (afaik £30-40 m/season on top of now???), and reduced player value depreciation costs in the future, and they won't be far off passing the criteria.

Ok so the rules are a joke, but in five years time they will be less so as eventually the whole wage bill will be included in FFP.

 

[mano-obe]

No one will ever get done by the FPP stuff

 

[adamthfc]

No one will ever get done by the FPP stuff

Nope and im amazed people seem to genuinely believe anything will happen

 

[dontcallme]

Man City will probably be a bit more willing to sell to us now. They'll need to make their finances a bit more realistic and selling the likes of adebayor, Johnson and others will help them.

 

[chrissivad]

No one will ever get done by the FPP stuff

that starts next season doesn't it?

and even then its a gradual introduction