Room for malfeasance in transfers


Financial Fair Play rules are there to enhance stability in football and reduce dependency on benefactors, who can slip away from the game at a moment’s notice.  Not all benefactors are the same, some are fully committed to their football projects and display a deep-seated need to live vicariously through the success of their football team.

We don’t have FFP rules in Scotland, however clubs who qualify for European competition are required to meet Uefa’s Financial Stability Regulations (FSR).  A different set of rules exist in England, but all rules are designed to meet the same ends.

Compliance is not always about cash. You can have £1bn in the bank and still fall foul of the rules, while you could in theory be in the same amount of debt and meet them.  Chelsea embarked on an interesting approach.  They spent big under new owner Todd Boehly.  To compensate, they gave new signings very long contracts.

If you have been around here for 20 years, you’ll know, but just in case, an explainer.  Transfer fees do not hit the profit and loss account in full when a player is signed.  They hit evenly over the period of the player’s contract.  So, a £100m player on a five-year contract, hits the P&L at a rate of £20m a year.  However, if you sign the same £100m player, but give him a 10-year contract, the hit to the P&L is only £10m.

This is Chelsea’s strategy; it is risky, but it is open and honestly constructed.

There is room for malfeasance in transfers.  Each player has a book value.  A player you have just signed for £100m is worth £100m, even if you are the only one who thinks so.  A player the world thinks is worth £100m, whom you developed through your youth system and have never paid a transfer fee for, is worth zero in accounting terms.  Value can only be established by a sale transaction.

Two clubs could each have a youth player, worth zero in accounting terms; then agree to a swap deal.  In this instance, the value they attribute to these players is completely arbitrary: they could set a £1m value or a £100m value to each player, as it would not affect their cash positions.  It would, however, affect their compliance with FFP rules.

Clubs swapping players who previously had zero book value for £100m would instantly have £100m more in player assets and would therefore be able to spend more before breaching FFP rules.

Completely unrelated to all of the above; Newcastle United yesterday agreed to sell Elliot Anderson to Nottingham Forest for £35m.  The player had a book value of zero before this.  On the same day, Nottingham Forest agreed to sell Odysseas Vlachodimos to Newcastle for an undisclosed fee.

Vlachodimos made five league and two cup appearances for Forest last season, so will no doubt be thrilled at the prospect of competing for a place in a squad that finished 10 spots ahead of Forest in the table.

As well as accountants, the game needs really good lawyers.  Got through the whole article without mentioning amortisation!

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  1. bigrailroadblues on

    Good afternoon all from the Jolly Tar, Cleveleys. Mrs BRRB gone shopping again. Where’s my credit card?🤔

  2. The Blogger Formerly Known As GM on

    That’s why you always take the P&L account with a large pinch of salt and look at the cash flow statement 👍

  3. Why no ffp rules in Scotland?


    Why no reserve league?


    Why have a top team league with a pool of 50?



    We have to have restructuring for benefit of both teams and national teams



    Meantime where do i park my crane!




  4. Is Celtic compliant withh FFP? Our bank balance must be around 3 figures millions, otherwise what is the point of this leader? We need to start with a very reliable goalkeeper 2 probably as Siegrist appears to be personna non grata. Nada in the pipeline it would seem.

  5. bournesouprecipe on

    Scott Bain, Josh Clarke and Joe Morrison.



    A back up at best keeper, and two developing youngsters.

  6. Seems so long ago that a body was found in the Thames, believed to be the Clapham chemical attack suspect.


    It was also when Joe Hart gave Celtic his notice to retire.


    If only I understood accounts better, I could appreciate the reasons for no obvious moves to replace


    Can only hope any new keeper / other signings are able to satisfy the Esta requirements, allowing them to travel stateside with the team. (I realise esta is probably called something else these days)

  7. How is Toby doing on loan, is he anywhere near challenging for a place on the bench?

  8. The returnof weeron on




    Amortization was what attracted me to CQN in its very early days. You had some interesting to-and-fro’s with Neganon back then.



    Chelsea: The EPL folk changed the rule, making 5 years the max for amortization. By the time they caught on to what Chelsea were doing, quite a few contracts had been signed for 10 years. I think that the 5 year rule was not retroactive.




  9. bournesouprecipe on

    Islam Feruz is retired from football and was last heard of selling designer clothing.

  10. So the Saudis making a big noise about confirming to PSR while looking at loopholes to exploit. Who would have thought it? There was talk about Antony Elanga also moving from Forest to Newcastle, but that doesnt seem to have happened. The date of the deal is significant – the year for PSR is 1 July to 30 June so Newcastle look to have worked to conclude the deal in time to be included before the deadline.



    Its a bit of a strange way of trying to work round the regs, it’s pretty transparent what they are trying to do, but they must be totally confident that it wont get them points deductions. If theres one thing that can be guaranteed its that they’ve done their homework and the lawyers are confident they can get away with it.



    Forest seem to take a different approach, probably in keeping with the different m.o. their owner employs. Also owner of Olympiakos and joint owner of a Portuguese team with Jota and Bernardo’s agent Jorge Mendes and accused of drug trafficking, he doesnt seem to care much about the regs or the punishments being in breach brings.



    There is a high profile precedent for this, Juventus and Barcelona did something similar but more obviously dodgy with the “transfers” of Melo and Pjanic. Ridiculous valuations of both players helped Barca and Juventus approach break even for the year and helped with falling within the FFP limits. Juventus got caught, and eventually were docked ten points in Serie A, Barca seemed to have got away with it with the Spanish FA which is not a surprise. Both seem to have got away with it with UEFA though.



    Its hardly the most creative accounting you’ll see so you can only imagine what else the Saudis highly paid accountants and lawyers are up to that we’ll never find out about.



    Fortunately the EPL has closed the loophole that Chelsea exploited regards amortisation of transfer fees over the length of contracts but the cavalier approach they took to it tells you everything you need to know about their attitude. They are still signing or trying to sign piles of young talent, they arent letting anything get int eh ebay of the model.



    As far as Celtic goes, it does show what we’re up against in the transfer market. The Saudis have cash even we can only dream of at their disposal but they’re still at it. Forest were a mid ranking team until Evangelos Marinakis took over and decided to spend what he wanted on a bunch of players we might have shown an interest in. Business associates with Jota’s agent, a very fluid relationship with the laws of the land never mind football regulations.

  11. Newcastle signing Forests keeper might mean the end for Dubravka, assuming the Toon have signed him to actually play. Dubravka is 35 so not quite middle-aged but probably fitting with the “experienced” profile we seem to be craving at the moment

  12. At least we didn’t give James McCarthy an eight year contract…


    Did we?

  13. Dessybhoy




    Toby Oluwayemi was a promising youngster but has been injury ravaged in his 2 loan experiences with Cork City, where he played only 2 games and conceded 4 goals, and this season past with Admira Wacker where he managed 9 games and kept 5 clean sheets, conceding 6 goals in the other 4 games.



    He only got into the Wacker team at the end of March and played in the next 9 games straight, missing only the last game of the season.



    The Austrian stats are more impressive than his Irish experience but his injury record is worrying- he’s missed a lot of the last 2 seasons- so a further loan is likely.

  14. Superbru Round of 16 Update.



    Our Round 1 winner was Kelvinbhoy- 15 pts


    Our Round 2 winner was Borgo67- 16 pts


    Our Round 3 winner was MWD1967- 13 pts



    And our best performers in Round4- The Round of 16 were:-



    1. James Cant- 12 pts


    2. RP McMurphy- 11 pts


    3= Celticrollercoaster & hairlikespaghetti- 10.5 pts



    This leaves the overall Leaderboard as:-



    Jobo Baldie – 41 pts


    18 Yard Man- 40.5 pts


    Borgo67- 39.5 pts


    Hairlikespaghetti- 39 pts


    Hamiltontim- 38.5 pts


    6= One Malloy & Drew67- 38 pts


    8. Knoxy- 37 pts


    10= SFTB, ACGR, Call me Gerry & Celticrollercoaster- 36.5 pts



    So, it’s a very tight race with all to play for but detached from the running we have an equally tight race at the bottom with snapper1969 on 25.5 pts, Chalmersbhoy on 26 pts & Bognorbhoy on 26.5 pts.



    Next deadline is Friday 5th July for the Spain v Germany game- the form team versus the home team.

  15. bournesouprecipe on

    James McCarthy refreshed and ready to go after a summer of walkin fitba.

  16. GREENGRAY1967 on 3RD JULY 2024 12:03 PM



    My Daughter and her friend would be interested, if you could contact me Through Admin.

  17. bournesouprecipe on

    Ronnie lisbon lion Simpson and Fraser the wall Forster both ex Newcastle

  18. bigrailroadblues on

    Good afternoon from the Shipwreck Brewing Company, Cleveleys. Chucking it doon again ffs. 😡

  19. Thats the Irish goalkeeper I asked about the other day.Dont think I got an answer..Not unusual.



    Another question.Now it looks like they are getting Hampden,can anyone remember what Fergus said about the SFA charging him exorbitant rates.He was very derogatory about what they charged us for renting.

  20. First Andy Murray was scheduled to play in the Mens singles at Wimbers


    Then he said he was going to play in the Mens doubles with his brother Jamie


    Now he is going to play Mixed doubles


    What’s next, stick on a See You Jimmy wig and try and get a wild card for the Womens singles?!!



    It’s a funny old game

  21. Bada Bing



    Is that Tommy ‘s wife passed away aswell ?



    May she rest in peace ,and heartfelt condolences to her kid’s other family and loved ones .



  22. TinyTim on 3rd July 2024 2:31 pm



    Bada Bing



    Is that Tommy ‘s wife passed away aswell ?


    May she rest in peace ,and heartfelt condolences to her kid’s other family and loved ones .








    Sorry to hear that.



    May she Rest In Peace

  23. bournesouprecipe on

    That awkward moment when you very nearly press balance at the cash machine.

  24. greengray1967 on

    TOMMYTHETIM on 3RD JULY 2024 2:11 PM


    GREENGRAY1967 on 3RD JULY 2024 12:03 PM







    My Daughter and her friend would be interested, if you could contact me Through Admin.



    Crossed wires pal. i was just telling SS where we usually sit.

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