Everton, our summer transfers and short term cost control regulations

[Jozzy]

No mate, just the profit.

So for example we bought player X two years ago for £12 million on a 5 year contract. That player's book value is now £7.2 million because his value is depreciated in a straight line across the term of the contract.

We sell player X for £18 million. The profit on the player is £10.8 million which would be added to the non broadcasting income. We can use that income for total salary increases.

Any idea why it works like that mate? The money we spent on a player was already deducted from our accounts at the time of purchase so we is the fee revisited?

 

[The Esk]

Any idea why it works like that mate? The money we spent on a player was already deducted from our accounts at the time of purchase so we is the fee revisited?

Because that's how you account for the purchase and sale of depreciating assets in businesses mate.

 

[ToffeeDoug]

Any idea why it works like that mate? The money we spent on a player was already deducted from our accounts at the time of purchase so we is the fee revisited?

Only a share of the player's value was deducted from our P&L / accounts in the year of purchase, done via the depreciation line. 4 year contract, 1/4th share, 5 year contract 1/5th share etc. That way, the value of the asset (player) is spread over their useful life (contract term).

 

[russiandog]

Should be after EBITDA but probably isn't

 

[evertony]

Because after the age of about 12 what team you support doesn't really matter mate if your a professional footballer

City are in much better shape over the past 3 years than United are
City have the better manager - especially so for someone with Stones style as a defender
City have more money
City are much more likely to win things than United
City will play in the CL next season not the EL like United


Also a lad from Barnsley may be a huge United fan, but he won't have that same sense as a lad from Manchester would have about the derby rivalry etc anyway, and throw in what i said about it not really mattering for footy players who they support - unles ofc your talking about Liverpool in which case they almost demand that anyone they sign has always been a boyhood red

City may have the money, but they have don where near the worldwide popularity that Utd have. Whether Guardiola is a better manager is open to debate, and based on being a centre-half needing a mentor I'd be as bold enough to say Koeman will provide better guidance than Guardiola.
Utd under Jose are as likely as City to win things.
And that stuff about not being from Manchester and so not having the same sense of rivalry is just hogwash I'm afraid....I'm a Manc, been an STH for nigh on 40 years at GP and if you think I don't dislike the [Poor language removed] like someone from L 4 then you're very misguided.

And, he's seen how great the big City signings are first hand.....Raheem Strerling for one!

 

[evertony]

Because theres a huge difference in selling a player for the good of the club in the sense of it papering over a financial mess and lack of investment - like with the Rooney and Arteta sales - they are sales to cover the Chairman/owners arse

and selling a player because without it you are stymied on being able to change the financial structure of the club as fast as you would like to do

Would you rather everton take 3-4 years to be contesting at the top of the table but do so with stones in the side still when they do get their

or would you prefer everton to be contesting at that level from next season - but without stones int he side?

Black and white the way i've stated it, but in essence thats the scenario faced

It's not the scenario faced though is it....it's @TheEsks opinion on the scenario. Why is it not possible to sell Lukaku and keep Stones?

 

[bobbydigital]

Any idea why it works like that mate? The money we spent on a player was already deducted from our accounts at the time of purchase so we is the fee revisited?

Only a share of the player's value was deducted from our P&L / accounts in the year of purchase, done via the depreciation line. 4 year contract, 1/4th share, 5 year contract 1/5th share etc. That way, the value of the asset (player) is spread over their useful life (contract term).

The original transaction is recognised on the balance sheet when it takes place to reflect the transfer of assets (us paying money to own the players contract).

Then as ToffeeDoug says the asset we have purchased is depreciated over the life of the contract which hits the P&L in the form of depreciation and the balance sheet in the form of reducing the value of the player contract asset.

When we sell the player we receive money in order to relinquish our right to the player contract asset which hits the balance sheet. When this happens, usually the amount of money we receive is different from the value remaining on the player contract (original transfer fee less depreciation). The balancing figure which reflects the difference between what we sell the player for and what the player contract is worth per our accounts is the player trading profit figure.

 

[tirion]

It's not the scenario faced though is it....it's @TheEsks opinion on the scenario. Why is it not possible to sell Lukaku and keep Stones?

The esk quite clearly has info that Stones will be sold, £45 million for a centre half that cant head a ball and frequently lets attackers move off him or across him whilst he ball watches is good money and will allow us to increase the wage bill and bring in some decent talent in order to make us competitive. Lukaku and his goals are more important to us in the next 12 months and given his agents change of tac indications are that he will be staying, what is crucial now is that we recruit the right players, Perisic, Schneiderlin, a good goalkeeper and centre half would be a good starting point.

 

[catcherintherye]

great post mate.

I'm sat hear wondering wether the fact that being an evertonian with our financial woes & having to become knowledgable on footbal financials is a good thing or would I rather be ignorant like almost every other fan I meet & talk too.

They say Ignorance is bliss & in many ways A poorly ran Everton & modern football has meant we have lost our innocence.

I don't think we need to get to know the ons and outs. What I am seeing with Moshiri is the optimism level is rising. I think it is our jobs as fans to provide an honest defence (and critique if necessary) of the regime but also try to put a calm response.

The media are going to start to turn the knife soon. They will not like another club trying to muscle in on the cartel and will look to undermine is. Calm heads will be needed.

 

[Simon baker]

I don't think we need to get to know the ons and outs. What I am seeing with Moshiri is the optimism level is rising. I think it is our jobs as fans to provide an honest defence (and critique if necessary) of the regime but also try to put a calm response.

The media are going to start to turn the knife soon. They will not like another club trying to muscle in on the cartel and will look to undermine is. Calm heads will be needed.

Very true particularly if we do sacrifice a player for the anticipated wage increase.

It will be spun in a number of derogatory/negative ways.

It's difficult trying to explain to some people who simply want to turn up & watch nothing more. I tried last week to a friends dad & he looked at me as if I was talking Chinese & making it all up.

 

[catcherintherye]

Very true particularly if we do sacrifice a player for the anticipated wage increase.

It will be spun in a number of derogatory/negative ways.

It's difficult trying to explain to some people who simply want to turn up & watch nothing more. I tried last week to a friends dad & he looked at me as if I was talking Chinese & making it all up.

For a lot of Evertonians and a lot of the media it will seem business as usual. Kenwright still the front guy and Moshiri is an investor not a de facto owner. It won't make much difference, but having fans on board will help. I think we have to get behind the team and anything is possible going forward.

 

[bluestevon]

It's not the scenario faced though is it....it's @TheEsks opinion on the scenario. Why is it not possible to sell Lukaku and keep Stones?

Because we have at least one club that is willing to meet the valuation we have set on stones, and none who have shown willingness to meet the clubs valuation of Lukaku, added to that, the press have obviously been getting briefed about us wanting to keep hold of Lukaku, the leaked wage offer for example and talking about the meetings with Riaola and his subsequent change of tone following that (added to Lukaku for once shutting up and passing the question about his everton future entirely to his agent - in stark contrast to his normal motor mouth talking up leaving response)

Club has been very quiet about Stones - no stories about a new deal etc

Disregarding what they may both become int he future, right at this minute we have a choice apparently between keeping hold of a prolific 23yo forward or keeping hold of a greatly talented ball playing centre back, going into next season i know which one keeping hold off will improve our chances for the season and which one short term at least is much more easily replaceable

 

[bluestevon]

Very true particularly if we do sacrifice a player for the anticipated wage increase.

It will be spun in a number of derogatory/negative ways.

It's difficult trying to explain to some people who simply want to turn up & watch nothing more. I tried last week to a friends dad & he looked at me as if I was talking Chinese & making it all up.

The timing will be crucial on it all, IF we do sell stones - which appears very likely then it has to be countered with one huge arrival at the same time or with several high profile signings - we do that and balance it then the media won't be able to portray us as a selling club

 

[Simon baker]

The timing will be crucial on it all, IF we do sell stones - which appears very likely then it has to be countered with one huge arrival at the same time or with several high profile signings - we do that and balance it then the media won't be able to portray us as a selling club

Very True & it's evident that the club are working hard behind the scenes to get journalists to create positivity in the media. Richard Buxton tweeted about it.

Ultimately this is essential as it can help improve our commercial deal renewals

 

[ToffeeDoug]

The esk quite clearly has info that Stones will be sold....

I don't think that is true in the slightest.