6 + 2 Point Deductions

[John from Bootle]

But maybe you would have been happy for Big Joe to have funded the ground from your Council Tax ?

Almost zero chance he pays council tax in the Merseyside area. My money is on him paying his to Brentwood Council.

 

[johnjoeefc]

If so many teams are so close to breaking the profit and sustainability rules, doesn't that suggest that the 105 million threshold is too low?

 

[Goat]

It’s clear in the heat of this that the message is getting lost on a lot of people.

Yes there were rules, yes we are an absolute mess of a club that is incompetent to the point of laughter however….

The argument isn’t that we are not “bang to rights”, the argument is firstly the rules that we are “bang to rights are anti-competitive, poorly designed and have been shown with great detail and evidence to have multiple failings pointed out by lawyers, media and politicians not just internet message boards and social media posts.

The other aspect to this is the application of penalties in the sense of unfairness and lack of transparency which masters did himself no favour in adding fuel to the allegations of mistrust and fixed agendas such as a two tier system favouring the sky six. The arguments about wanting to apply the penalty last year but was allegedly rejected by Everton is debatable without evidence and another in a long line of contradicting statements the PL have leaked through client journos over the last two years.

So the overarching feeling isn’t that the club have NOT done wrong or people are deluded with paranoia, the feeling of anger is at the application of the rules towards Everton which are out of kilter with other clubs (see fines or settlements with Chelsea, mancs and even Leicester and others) plus the slandering of the club by a carefully managed media machine.

That is the majority of fans issue here.

As for gwladysknight etc who seem to get off on the fact the club have been penalised and others intent on us taking our medicine, no amount of arguing point four five seven of some toilet roll worthy document from a corrupt “independent” commission is going to get you anywhere. They might be RS on the wind up but if they have time on their hands to spend hours on a rival message board when life comes at you fast, I’d rather spend my time elsewhere living life than even consider logging onto RAWK.

Whatever people’s agenda or views on the financials, that’s their prerogative but we are talking here of the existential threat to a club coming close to 150 years old with a long and illustrious heritage being destroyed by a cartel of protectionist poundshop dragons den contenders who were so bad at their job they were only fourth choice for the role. Why? Because they are there for 6 of the 20 members and until tribalism and whatabouttery subsides, the other 12 clubs will be next.

Im honestly just really, really, really annoyed at Everton.

It very much clouds my judgement on this issue.

 

[Lloydaldo11]

Is that you Richard ?

On your point in bold, if the stadium wasn't being built and paid for out of the clubs pocket (and was instead paid for via a drain on the tax payer) there would likely have been no need for the other loan thats claimed to have been towards the running of the club.

You may have a credit facility that you use to help service your monthly bills but if your mortgage jumps up by £500 a month (inflation due to Ukraine war) and your overtime in work is cut (USM sponsorship) then you may need to take out a further credit facility to help keep the bank at bay.

Just because you use some of that loan on the weekly food shop doesn't negate the fact that had the mortgage not increased and your income hadn't been cut, you wouldn't have needed said loan in the first place.

Thats essentially what has happened. But maybe you would have been happy for Big Joe to have funded the ground from your Council Tax ?

Not sure if they have council tax in Norway or the far east

 

[gwladysnight]

Is that you Richard ?

On your point in bold, if the stadium wasn't being built and paid for out of the clubs pocket (and was instead paid for via a drain on the tax payer) there would likely have been no need for the other loan thats claimed to have been towards the running of the club.

You may have a credit facility that you use to help service your monthly bills but if your mortgage jumps up by £500 a month (inflation due to Ukraine war) and your overtime in work is cut (USM sponsorship) then you may need to take out a further credit facility to help keep the bank at bay.

Just because you use some of that loan on the weekly food shop doesn't negate the fact that had the mortgage not increased and your income hadn't been cut, you wouldn't have needed said loan in the first place.

Thats essentially what has happened. But maybe you would have been happy for Big Joe to have funded the ground from your Council Tax ?

The only thing that matters is that we were trying to claim interest for a loan whose terms stated that it wasn't to be used for the Stadium. It is the same as getting a free lift into work and then trying to claim a mileage allowance for a journey you haven't made. Stating that you are only doing it because your mortgage has gone up and your overtime has been cut isn't going to work.

Interest for loans for Stadium development can be capitalised and used as a PSR exclusion. Loans for normal expenses cannot.

 

[Dixieslaces]

These muppets on Sky, one so Cockney it hurts!!

No brain cell between em absolute bells

 

[John from Bootle]

Im honestly just really, really, really annoyed at Everton.

It very much clouds my judgement on this issue.

Just remember one fact Goat. One of the principle aims of PSR is to protect clubs, fans and communities from the horror show of administration.

We'd have been punished less if we completely ignored all warnings and gone into administration. In no universe is that just, regardless of culpability.

 

[John from Bootle]

The only thing that matters is that we were trying to claim interest for a loan whose terms stated that it wasn't to be used for the Stadium. It is the same as getting a free lift into work and then trying to claim a mileage allowance for a journey you haven't made. Stating that you are only doing it because your mortgage has gone up and your overtime has been cut isn't going to work.

Interest for loans for Stadium development can be capitalised and used as a PSR exclusion. Loans for normal expenses cannot.

Seeing as you're such an expert, you will know fully well that we're not even appealing the verdict. We're appealing the punishment.

I will ask you for a fourth time now; do you think that a punishment harsher than that for going into administration is fair?

 

[Tipp blue]

That is completely and utterly wrong. Basic accounting procedures mean that expenditure cannot be capitalised until something is probable. Something is not probable until planning is granted. That isn't a Premier League rule it is the cornerstone of FRS 102.

We breached PSR rules two years ago and could have been charged with non-compliance.

What actually happened is that the Premier League and the club came to an agreement that the Premier League would not invoke rule E.51.2.. That meant we avoided being charged and a probable points deduction.


The 13 August 2021 agreement contained the following
(amongst other) terms.
1.2 During the Club's financial years 2017-2020 (inclusive), prior to the
financial year when planning permission for the Stadium was obtained,
the Club incurred costs of approximately £39,346,000 in respect of the
Stadium (the “Stadium Costs”). Given that the Stadium Costs were
incurred in the financial years prior to planning permission being
granted, under applicable accounting regulations, these costs cannot be
capitalised and must therefore be included in the Club’s PSR
Calculation.
1.3 The Club is forecast to be non-compliant with Rule E.51 of the Rules
by:
1.3.1 having a PSR Calculation with losses in excess of £105 million
(the “Threshold”) for Season 2020/21; and
1.3.2 potentially Season 2021/22 and 2022/23
(together the “Potential Non-Compliance”).
1.4 Subject to compliance by the Club with the conditions set out in
paragraph 2 of this Agreement (the “Conditions”), the Premier League
agrees that it will not, either during the Term or at any time after (i)
exercise its powers set out in Rule E.15 in respect of the Potential Non-
Compliance and/or (ii) refer the Potential Non-Compliance to a
Commission pursuant to Rule E.51.2.
2.1 The Club’s PSR Calculation for Seasons 2020/21, 2021/22 and 2022/23
(after the application of any mitigation or reduction by the Board in
accordance with the guidance it has issued in relation to the impact of
COVID-19) must not exceed the Threshold plus such portion of the
Costs as falls to be reported in the relevant period (the “Threshold
Condition”). For the avoidance of doubt, the relevant period is the
financial year in question and the two preceding financial years.


So instead of this being a witch hunt against us the Premier League actually helped us out. They also allowed us to include much bigger COVID losses £170m almost double the next biggest losses which was Arsenal at £86m followed by Villa at £56m.

They also allowed us to include £30m from Usmanov for an OPTION for naming rights despite no one else being interested. The Premier League bent over backwards to help us. When we failed PSR because of the long wait for planning they let us off. When we were going to fail again they allowed us ludicrous COVID losses. When we going to fail a third time Usmano was allowed to write a £30m cheque for an OPTION.

We were given chance after chance. Instead of heeding those chances Moshiri and the board ignored the warnings and tried to claim interest for working capital loans that were not used for the Stadium. Not only that but he tried to back date them.

32. In February 2022 Everton decided to pass on the interest charges payable
under the Rights & Media Funding Ltd and Metro Bank PLC loans by levying
interest on the inter-company loan to Everton Stadium Development Ltd.
The intention was that that interest would be calculated retrospectively from
FY 2018 and all charged in the FY 2022 accounts.


He tried to roll up years of interest charges for working capital and looked to pretend they were for the Stadium. This is despite there being documents that showed that the Stadium was funded by interest-free loans from Moshiri himself. The charge documents from the loans also stated that they were not for the Stadium.

Here are the documents in question.

Use of Funds
If the facility is successfully completed, the funds will be used for working capital facility
purposes. Hence, in the same way as the Rights and Media Funding Limited facility this
additional financing support will be used for operational purposes during the 2020/21
season.
We do not intend to use any of the funds for the new stadium project or to buy players in
the transfer window. These funds will be used to continue to support the Club and all of the
activities that the Club are involved in for the term of the facility.
That representation is incorporated into the Metro Bank PLC loan agreement
dated 29 April 2021. Clause 2.3 reads –
Purpose
The Borrower shall apply all amounts borrowed by it…towards the payment of
indebtedness and its working capital requirements



So there was no moving of the goalposts and there was no new rule. If anything the Premier League has been incredibly lenient with us. Instead of looking at things rationally and coming to the obvious conclusion that the club had pushed things too far we have a PR campaign calling the Premier League corrupt because they finally had enough of our ludicrous attempts to ride a coach and horses through PSR regulations.

Spurs were allowed to deduct pre planning expenses. The rules were changed... you've gone through the bother of putting all that together and I'm not reading any of it beyond the first paragraph where you are completely wrong. We spent 54 million pre planning we would not have broken rules if we weren't building a stadium.. any real Everton fan would look at that and not argue against the club as you do.. interest on loans is miniscule compared to that like I said STFU with that argument.

 

[Lloydaldo11]

Im honestly just really, really, really annoyed at Everton.

It very much clouds my judgement on this issue.

I think we all are but the reality is that endless anger at a board where 90% have now left is worthless. As they leave, like most company CEOs or MPs and easily get another job, it is fans left with their mess to deal with.

That’s where my real anger is at the state of the game and not once has anyone mentioned what was trumpeted for a week across all media following the super league debacle which was “DONT PUNISH THE FANS”

Masters showed the real face of the PL today, he and the cartel only care about the customers of the sky six. We are just collateral.

The internal looking frustrations need to be kept internal but when you have a broken system and a governing body willing to use your club that you love and can’t walk away from as a pawn in a bigger agenda then you do have to put those internal issues aside as a fanbase and front up otherwise the demise will come sooner than we think and nobody will bat an eyelid as the did with other clubs over the last 30 years

 

[gwladysnight]

Just remember one fact Goat. One of the principle aims of PSR is to protect clubs, fans and communities from the horror show of administration.

We'd have been punished less if we completely ignored all warnings and gone into administration. In no universe is that just, regardless of culpability.

Moshiri would have lost control of the club if we had gone into administration.

 

[John from Bootle]

Moshiri would have lost control of the club if we had gone into administration.

So do you or don't you think a 10 point penalty is fair and just?

 

[Baileys perm]

If so many teams are so close to breaking the profit and sustainability rules, doesn't that suggest that the 105 million threshold is too low?

It implies that one by one clubs fall foul and can’t buy players to improve squads and even if they develop players through a good academy set up them players will be sold for peanuts to the top6 as they need the money to balance the books, only ones PSR will benefit is the usual top 6

 

[Duncan’s Pigeon Loft]

The only thing that matters is that we were trying to claim interest for a loan whose terms stated that it wasn't to be used for the Stadium. It is the same as getting a free lift into work and then trying to claim a mileage allowance for a journey you haven't made. Stating that you are only doing it because your mortgage has gone up and your overtime has been cut isn't going to work.

Interest for loans for Stadium development can be capitalised and used as a PSR exclusion. Loans for normal expenses cannot.

Just [Poor language removed] off you dirty little red [Poor language removed]

 

[Dixieslaces]

Moshiri would have lost control of the club if we had gone into administration.

Already has lost control you bellend