Wages at 65% of Turnover

[Pablo]

But are moneys raised by direct investment not income? You see why I'm asking now?

i see what you are asking, and donations can be used for stadium upgrades, admin staoff etc etc but AFAIK players wages are directly tied into turnover, which do not include donations, just the amount of business transacted during a given period of time.

[Dodge]

But where did you get that idea?

[Risteard]

I thought it was 65% of expenditure.
City have a big wage i'd say but enough other expenses aswelll.
Rent of Turners Cross. (this is hefty but includes all matchday expenses afaik)
Rent of Bishopstown.
Rent of Patrick Street.
Ridden Rock Solid Tax aka fines for kicking down doors, talking of molesting the football, fans singing etc etc.
We're the first body to be issued with a PRRSI number.

[daniel]

Sugar Daddy's trowing money into clubs will count, as someone has said, if the money is in the bank, its the clubs funds...

And any club who has been seen to be above the 65% and aware of it, will probably have a serious fine on their hands from the licence committee.

The rule is here to protect our clubs, any club who doesn't follow it deserve all they get!!

[endabob1]

I haven't read the in depth details of the liscenceing agreement but I would imagine that Turnover will be defined as any income generated from the normal activities of the football club, so Advertising, Gate receipts, program sales etc....
Sugar Daddy cash is cash it is not turnover, generally it will be in the form of a share purchase or a long term loan.
Also in the €3 program example, the €3 is turnoever €2.50 is the direct cost 50c is gross Margin, the profit would really need to include an apportionment of other costs.

[Pablo]

I haven't read the in depth details of the liscenceing agreement but I would imagine that Turnover will be defined as any income generated from the normal activities of the football club, so Advertising, Gate receipts, program sales etc....
Sugar Daddy cash is cash it is not turnover, generally it will be in the form of a share purchase or a long term loan.
Also in the €3 program example, the €3 is turnoever €2.50 is the direct cost 50c is gross Margin, the profit would really need to include an apportionment of other costs.

Spot on.

[paudie]

I haven't read the in depth details of the liscenceing agreement but I would imagine that Turnover will be defined as any income generated from the normal activities of the football club, so Advertising, Gate receipts, program sales etc....
Sugar Daddy cash is cash it is not turnover, generally it will be in the form of a share purchase or a long term loan.Also in the €3 program example, the €3 is turnoever €2.50 is the direct cost 50c is gross Margin, the profit would really need to include an apportionment of other costs.

Correct is nearly all cases I'd say. Investment by directors would almost always be treated in clubs accounts as loans that (theoretically at least) will be repaid by the club at some stage. That is the case in Drogheda's accounts for example.

It's hard to see how these "loans" could be treated as turnover under any circumstances.

The only way would be treated them as non repayable "donations" in the accounts but that way the directors would be saying they will never get the money back.

[paudie]

It can be very easily avoided. Writing up phoney accounts, only putting down percentages of players wages as wages but the rest down as something else.

As far as I know all clubs accounts now have to be audited.

In these days of tight regulation it would be a foolish auditor who would put his name to accounts he had any reason to believe were "phoney" in any material way.

[paudie]

But are moneys raised by direct investment not income? You see why I'm asking now?

If the direct investment involved someone buying shares from existing shareholders, as happened with Pats I believe, this is income of the old shareholder, not the company.

[galwayhoop]

it is only right that the 'sugar daddy' payments are not included. the reasoning behing the 65% is to ensure the longterm viability of clubs and to increase their chances of survival. so we don't get another shels situation.

a sugar daddy is not a constant. he may withdraw funds at any given time and find a new venture. a new shiny toy to play with. imagine if abramovich was to pull out of chelsea tomorrow - the club would be bankrupt as it would not be able to pay all it's bills.

the 65%, while probably not really in -line with the european constitution (is football not viewed as any other business in european law?? so how can wages be capped in relation to turnover?? does this happen in any other 'industry'), is there to protect the long-term interests of the league and should be viewed as a good thing.

it may however add to larger inequalities between the top teams and the lower down teams but thats just life. i mean the difference in the turnover of the likes of bohs and monaghan would be very big i assume.

in reality though i still think that sugar daddy types can put their donations down as sponsorship and then it will add to the turnover. for example mick wallace could sponsor wexfords main stand for € 1,000,000 per annum and have it called 'the wallace construction stand' (or whatever name his company is). theres nothing illegal about this and hard to show it as anything else but sponsorship!

[endabob1]

in reality though i still think that sugar daddy types can put their donations down as sponsorship and then it will add to the turnover. for example mick wallace could sponsor wexfords main stand for € 1,000,000 per annum and have it called 'the wallace construction stand' (or whatever name his company is). theres nothing illegal about this and hard to show it as anything else but sponsorship!

Spot on, but by doing that he is admiting he will never see that €1m again. The reason most investors choose the loan or share option is because they want to in some dreamland imagine themselves doing a Ken Bates and selling their shares for squillions

[galwayhoop]

Spot on, but by doing that he is admiting he will never see that €1m again. The reason most investors choose the loan or share option is because they want to in some dreamland imagine themselves doing a Ken Bates and selling their shares for squillions

maybe so but anyone who has a large amount of dough - so much that they can afford to invest in the eLoI - must surely have the smarts to realise that they will never see their money again!!

[endabob1]

maybe so but anyone who has a large amount of dough - so much that they can afford to invest in the eLoI - must surely have the smarts to realise that they will never see their money again!!

I agree in the main, someone like Wallace is deffenitely not in it for the financial rewards, I would have my doubts on some of the other investment though, particularly if the club owns a ground which could be sold off for commercial gain.....
It has happened several times in the lower leagues in the UK. By investing cash in exchange for shares you are top of the pile for any rewards should the ground get sold to developers.....

[Bald Student]

I haven't read the in depth details of the liscenceing agreement but I would imagine that Turnover will be defined as any income generated from the normal activities of the football club, so Advertising, Gate receipts, program sales etc....
Sugar Daddy cash is cash it is not turnover, generally it will be in the form of a share purchase or a long term loan.
Also in the €3 program example, the €3 is turnoever €2.50 is the direct cost 50c is gross Margin, the profit would really need to include an apportionment of other costs.

How far does this go? If a club has a bar that takes in a million a year with a profit of (say) 50,000 will the 1 million figure be used in the calculations?

[passerrby]

does anybody know if this equirement will be in the next licensing manual or as the fai say it is aspirational

[endabob1]

How far does this go? If a club has a bar that takes in a million a year with a profit of (say) 50,000 will the 1 million figure be used in the calculations?

I would assume (again as stated I haven't read the agreement in depth) that as long as the bar was part of club it's turnover would count as part of the clubs turnover...

[Bald Student]

I would assume (again as stated I haven't read the agreement in depth) that as long as the bar was part of club it's turnover would count as part of the clubs turnover...

OK cool,
It seems to me then that this system might have loopholes in it. Thinking of my own club, there's probably at least a few hundred thousand worth of stuff that could be added to turnover, if needed, to get within this rule. The same could well be true of a lot of clubs.

[passerrby]

would i be right in saying that if a club spends more that 65% of its overall income this can only be verified when the audited accounts are examined which means that all punishments would be issued after the league has concluded

[Dodge]

If the direct investment involved someone buying shares from existing shareholders, as happened with Pats I believe, this is income of the old shareholder, not the company.

He's already spent on Pats since he bought the shares, so does that count?

[passerrby]

this will not be a problem for the mons as we spend at least 50% of income on other parts of the club ie development, juviniles, community projects etc (hence the position in the table)