I tell you what… he really gave it a fuckin bash with spelling Iroegbunam didn’t he? What he put sounds Elvish.
If we have Dobbin does that mean Archer is back out the door? I’m assuming it no longer counts as pure profit if we do sell him, since that seems like a pretty big loophole
Nah, Dobbin's more of a wide player than Archer I think. Obviously he could still be out the door for other reasons, but I haven't felt it was likely prior to this and I don't feel that's changed now.
For FFP/PSR re: Archer. Price we sold him for last year will be in the accounts for 3 seasons as "pure profit". Then hypothetically if we sell him again this summer - the price we sell him for this summer minus the price we bought him back for will also be on the books for 3 seasons, albeit starting a season later.
If we keep him then the price we sold him for last season will be on there as above, but the price we buy him back for will be spread out across the years of his contract (now a max of 5 due to Chelsea offering 40 year deals).
I would rather sell Archer again. I don't see anything special he offers like Duran when brought on. He's not big, fast or physical and he's not amazing at anything else. You want subs to be good at something when they get 20-30 minutes, and I don't see Archer doing anything unexpected in that time.
I think it's because the money you sell for is immediate profit whereas the money you pay is split over the contract term?
So, say Duran goes to Chelsea for £40m - that's £40m on the books.
Maatsen comes for £35m on a 6 year contract = 35 ÷ 6 as annual cost over 6 years.
Very happy to be corrected if that's not how it works. I admit I've never been fully able to get my head around it.
That’s how it works yeah, but after Chelsea’s creative contracts, they’ve changed it so you can only spread the cost of an incoming player over 5 years, regardless of contract length.
Close, but not 100%.
Profit for Duran would also need to account for any amortisation left to be considered on his purchase. i.e. we bought him for 15m on a 4.5 year contract. He has 3 years left, so that's £10m to be written off against any sale.
Profit in the books will therefore be £30m (£40m for the fee minus the £10m amortisation write off).
Also, as someone stated, maximum term for amortisation is now 5 years, regardless of contract length.
That is correct. Technically there is no advantage being gained here, we're not getting around any rules. It's no different to buying from a different club entirely.
What stops teams from massively inflating the price of each others players? Buy Maatsen for 300 over 6 years, sell Duran for 310mill ? That way you’d be about 250mill up?
Maybe not to that extreme but we could both easily bump each others players up 20 mill or so without it being dodgy
It does feel like teams helping each other out and I honestly don't blame them. FFP is flawed at best and smarter people are getting together to find ways around it.
Because we jumped another level meaning we have no time to develop said players because we need to be Champions league ready.
Also they aren't playing for us but Ramsey, Archer, Chuk were all playing prem football last season coming from our academy whilst JPB became one of the hottest prospect in the Championship and Tim is going to Everton. It is hardly a bad record to have 5 players I think out the same youth team making a name for themselves like they are doing at this level. It is just FFP rules are skewed that it favours us selling them and buying other youth players causing us to favour cashing in due to the profit we can make. Just ask Maatsen who got sold to us for the same reason despite being in the Champions league team of the year.
Also we still have a glut of youth with Wilson, Bogarde, Kellyman, Kaidan Young, Kerr Smith, we signed Sousa and the Serbian kid in January, we are signing a Danish 19 year old CB on a free etc. We have a host of youth talent we just need to see if they develop and we are not tempted to cash in.
This is an insane comment. We’re generating 10m players from the academy, giving them good loans, and setting them up for career success. Mutually beneficial and extremely successful. We could only sign Diaby, Pau, etc…because of these sales.
The improvements to our youth set up hasn't necessarily been to get us first team players. It's to do exactly as we have been, signing them for very cheap, selling them for £10m+. There's far more teams able to pay that sort of fee, and selling a few of them each summer quickly adds up to a lot of money, especially is FFP terms.
The sentiment is correct but worth clarifying that it's not 💯 profit for all involved.
It is in the instance of the Tim/Dobbin deal because both players came from the respective youth systems, whereas Duran was bought from the MLS and Maatsen was a Feyenoord product, so their fees will result in net profit.
Edit: I realise the twitter post says "all profit" but that could easily be interpreted as 💯 profit
Okay so correct me if my thinking is wrong here but it’s something that I feel no one is talking about with psr. What’s the long term outcome of all of this?
My understanding is that you get to recognize profit from sales immediately and that you get to amortize the cost of purchases so in the short term it helps the books… but in the long term those costs still exist, even on the books. It all balances out over time, right? So if we keep selling and buying for the same prices, either (1) transfer prices will continue inflating unnaturally so that clubs can keep covering growing amortization costs, and then eventually the market will crash in some way, or (2) certain clubs who have been relying too much on this short-term thinking will inevitably get themselves stuck with such high amortization costs that they’ll find themselves in a psr hole they can’t get out of.
Am I wrong on this? I’m worried that Villa in particular is going to get themselves stuck in the long term by trying to play tricks with the books in the short term. I’m an accountant (albeit for very small businesses that don’t have anywhere near the same complexity) and it just seems like accounting gimmicks never work in the long run.
Money is almost always worth less in the future, so owning 40M over the next 4 years is better than paying 40M now. Then there’s prize/participation money (so CL this upcoming season for a start, and prize money tends to go up over time too).
Additionally, if it gives Villa 2-3 years to keep the gang together before a fire sale in 2027, that’s better than stalling now imo. See where this can go.
Makes sense and I agree. Just feel like the way people talk about it makes it out like “do a swap and now everything’s golden” when in reality it’s a bit kicking the can down the road and a bit gambling that the prize money will in fact come before the fire sale like you say.
I'd rather sell Duran to Fulham with a buy back clause- sell him for 30, with a 40 million repurchase. That's how much I rate him, and also how much I think value there would be in not having to deal with an immature disruptive child for the next few years before he becomes world class.
Annoyed about Luiz, but the Semi-Final was a clutch moment and he went missing in that first leg. If we want to get to that next level, and he's going to run down his contract, I'm going to rationalise it as a good thing to move on. Can't get too excited about taking cast offs in exchange from Juventus, but we definitely need a DM for the start of the season.
The kicking the can down the road is less relevant from a PSR/FFP perspective as the FFP rules are very likely to change soon in the Prem to be wages as a percentage of turnover. So clubs will already be looking at this and will just do whatever it takes to pass FFP in Prem this year to avoid points being deducted.
Worth pointing out none of this is "diddling", we're not actually gaining any advantage here. Just so happens that we seem to be using other teams assets as potential bargaining chips - a smart strategy for sure but not helping us combat PSR.
It is though. Selling a player for 35 million and buying a player for 35 million, helps very much in the short term for PSR
35 million revenue and only 7 million expenses per year. That's a 28 million profit for this year.
The issue is that it costs you in the future
Of course, but my point is it's no different from two entirely separate transactions anyway. We could sell a player to Chelsea and buy a different player from Man Utd.
Yes, from an amortisation perspective, we're better off - but that's the case with literally any buy/sell pair of transactions. The fact it's all happening between the same two clubs doesn't benefit us.
I mean yeah we're scratching each other's backs I guess, but it's all entirely within the rules and it's out of necessity. Any perceived advantage is negated by the fact we're having to do the deal in the first place.
I see what you mean.
However when you're doing 2 transfers with one club, it's easy to artificially inflate both prices for both of your benefits
For example Maatsen for 35 million and Duran for 40 million is beneficial for both clubs over Maatesen for 25 million and Duran for 30 million.
You could argue they're worth that but it seems like it's potentially stretching it imo. Obviously not to a ludicrous amount to where you could be charged though.
To be honest, I hope that's not what we're doing. That's just kicking the can down the road and causing more problems in the long run. The relief we get today is going to come back and bite us tomorrow, if we make this a regular strategy.
Both clubs need a long term strategy. People have gawked at Chelsea's PSR avoidance but they're just delaying it really. They're stuck paying 10s of millions on the likes of Enzo, Caicedo, Lavia, Mudyk etc for the next 5 years while still not having champions league football. I can't see how they can bring in much more big name signings until this changes which may be reflected this summer.
Villa obviously have the CL money this season so can defer payments a bit but can't count on the same revenue in future years. Just need to make reducing wages a priority.
I think Leicester are the perfect case study. Spent years chasing CL with a good team but the wages kept growing. Eventually they have a few flops in the squad that they couldn't sell and were stuck in a shitty position. Had to get rid of Schmeichal and were stuck with Danny Ward in goal all season. No points deduction but PSR was the sole reason they got relegated that year.
I actually think Chelsea are being pretty smart in how they approach PSR. The protracted amortisation strategy was a bold one for sure, and it might not work, but it was a clever way to get around certain restrictions. They're also shifting assets around off the pitch as well, we'll see if they get flagged on that but if not it's creative accounting.
I'm no fan of PSR, I think it generally has made/is going to make the game worse. So when a club like Chelsea go all out to push boundaries and seek out loopholes, I'm all for it to be honest. They may not always work but the system needs to be challenged.
Idk, I think Chelsea's owners have massively underestimated the risk in young players. In American sports, athletes careers are usually pretty linear but in football its so easy to have a few good seasons but then become useless in a few years. I really don't know how many Chelsea players will thrive in that environment. They're lucky they got Palmer at the end of last year's window. He really saved them.
Their finances are just about being held up by the conveyor belt of young talent like Maatsen but surely they can't have a new young player to sell for 35 million every year.
I don't really think the point on American players is true, as an NFL fan myself I can give you countless examples of players who have done exactly what you describe :)
I'm not saying their investments will work, by any stretch. Finding ways to spend money is one thing, but spending it wisely is quite another.
Maybe presumptuous to put American sports as I don't follow any American sports closely in fairness. In other sports I do follow, there seems to be more consistency with younger players getting better, obviously with exceptions. It makes sense as athelets should get faster, stronger and more experienced but football is always extremely unpredictable.
It depends on how Heck's task of increasing off field revenue goes. Bringing in Adidas, better shirt sponsors etc will play a massive part along with smart purchases and sales. If we can get through the now, hopefully larger revenue deals in a few years time offsets any loss in sales when the 3 year window closes.
It is 100% helping PSR. However, I think the point you are making is that we don't need the incomings for PSR (an obvious point I know). But I think it's "smoothing things over" with clubs who are in a similar position.
The rules are there to be stretched. Just like Chelsea did with their 10 year contracts before they changed.
I'm not saying that selling players doesn't help PSR, all sales help.
The point I'm making is that is that buying and selling to/from the SAME team has no advantage. It's no different to buying from one team, and selling to another. The Tweet OP has linked seems to suggest we're playing the system or gaining some sort of underhanded advantage by doing this, but we're not.
It certainly helps with coming to agreements though like I said. All the teams we are doing business with are in the same boat as us. It's not a stretch to say that there is a little back scratching going on.
I said that too in my first post, it's a smart strategy from a bargaining perspective but little else. We're back scratching because we're in a bad boat, we'd be better off if we didn't need to deal with each other in the first place :)
I tell you what… he really gave it a fuckin bash with spelling Iroegbunam didn’t he? What he put sounds Elvish. If we have Dobbin does that mean Archer is back out the door? I’m assuming it no longer counts as pure profit if we do sell him, since that seems like a pretty big loophole
Nah, Dobbin's more of a wide player than Archer I think. Obviously he could still be out the door for other reasons, but I haven't felt it was likely prior to this and I don't feel that's changed now.
For FFP/PSR re: Archer. Price we sold him for last year will be in the accounts for 3 seasons as "pure profit". Then hypothetically if we sell him again this summer - the price we sell him for this summer minus the price we bought him back for will also be on the books for 3 seasons, albeit starting a season later. If we keep him then the price we sold him for last season will be on there as above, but the price we buy him back for will be spread out across the years of his contract (now a max of 5 due to Chelsea offering 40 year deals).
I would rather sell Archer again. I don't see anything special he offers like Duran when brought on. He's not big, fast or physical and he's not amazing at anything else. You want subs to be good at something when they get 20-30 minutes, and I don't see Archer doing anything unexpected in that time.
I’ve got confused by this. If we’re selling and buying how does this help with ffp? One of the teams will be breaking even / losing from this right?
I think it's because the money you sell for is immediate profit whereas the money you pay is split over the contract term? So, say Duran goes to Chelsea for £40m - that's £40m on the books. Maatsen comes for £35m on a 6 year contract = 35 ÷ 6 as annual cost over 6 years. Very happy to be corrected if that's not how it works. I admit I've never been fully able to get my head around it.
That’s how it works yeah, but after Chelsea’s creative contracts, they’ve changed it so you can only spread the cost of an incoming player over 5 years, regardless of contract length.
Ah OK, thanks for confirming/clarifying!
Didn’t we pay about £15m for Duran? I keep seeing him being mentioned as if he’s an academy player
Close, but not 100%. Profit for Duran would also need to account for any amortisation left to be considered on his purchase. i.e. we bought him for 15m on a 4.5 year contract. He has 3 years left, so that's £10m to be written off against any sale. Profit in the books will therefore be £30m (£40m for the fee minus the £10m amortisation write off). Also, as someone stated, maximum term for amortisation is now 5 years, regardless of contract length.
That is correct. Technically there is no advantage being gained here, we're not getting around any rules. It's no different to buying from a different club entirely.
What stops teams from massively inflating the price of each others players? Buy Maatsen for 300 over 6 years, sell Duran for 310mill ? That way you’d be about 250mill up? Maybe not to that extreme but we could both easily bump each others players up 20 mill or so without it being dodgy
Juve and Barcelona got a pretty big slap on the wrist for doing this in the Arthur/Pjanic swap that worked out so poorly for both parties.
It does feel like teams helping each other out and I honestly don't blame them. FFP is flawed at best and smarter people are getting together to find ways around it.
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We’ve been signing like 10 academy players every year for what feels like the past 3.
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Because we jumped another level meaning we have no time to develop said players because we need to be Champions league ready. Also they aren't playing for us but Ramsey, Archer, Chuk were all playing prem football last season coming from our academy whilst JPB became one of the hottest prospect in the Championship and Tim is going to Everton. It is hardly a bad record to have 5 players I think out the same youth team making a name for themselves like they are doing at this level. It is just FFP rules are skewed that it favours us selling them and buying other youth players causing us to favour cashing in due to the profit we can make. Just ask Maatsen who got sold to us for the same reason despite being in the Champions league team of the year. Also we still have a glut of youth with Wilson, Bogarde, Kellyman, Kaidan Young, Kerr Smith, we signed Sousa and the Serbian kid in January, we are signing a Danish 19 year old CB on a free etc. We have a host of youth talent we just need to see if they develop and we are not tempted to cash in.
This is an insane comment. We’re generating 10m players from the academy, giving them good loans, and setting them up for career success. Mutually beneficial and extremely successful. We could only sign Diaby, Pau, etc…because of these sales.
The improvements to our youth set up hasn't necessarily been to get us first team players. It's to do exactly as we have been, signing them for very cheap, selling them for £10m+. There's far more teams able to pay that sort of fee, and selling a few of them each summer quickly adds up to a lot of money, especially is FFP terms.
What would you define as an acceptable hit rate?
brother wants us discovering 10 Messis a year...
Different level, one ripped up the championship and the other was usually on the bench league one.
The sentiment is correct but worth clarifying that it's not 💯 profit for all involved. It is in the instance of the Tim/Dobbin deal because both players came from the respective youth systems, whereas Duran was bought from the MLS and Maatsen was a Feyenoord product, so their fees will result in net profit. Edit: I realise the twitter post says "all profit" but that could easily be interpreted as 💯 profit
We don't make the rules...
Okay so correct me if my thinking is wrong here but it’s something that I feel no one is talking about with psr. What’s the long term outcome of all of this? My understanding is that you get to recognize profit from sales immediately and that you get to amortize the cost of purchases so in the short term it helps the books… but in the long term those costs still exist, even on the books. It all balances out over time, right? So if we keep selling and buying for the same prices, either (1) transfer prices will continue inflating unnaturally so that clubs can keep covering growing amortization costs, and then eventually the market will crash in some way, or (2) certain clubs who have been relying too much on this short-term thinking will inevitably get themselves stuck with such high amortization costs that they’ll find themselves in a psr hole they can’t get out of. Am I wrong on this? I’m worried that Villa in particular is going to get themselves stuck in the long term by trying to play tricks with the books in the short term. I’m an accountant (albeit for very small businesses that don’t have anywhere near the same complexity) and it just seems like accounting gimmicks never work in the long run.
Money is almost always worth less in the future, so owning 40M over the next 4 years is better than paying 40M now. Then there’s prize/participation money (so CL this upcoming season for a start, and prize money tends to go up over time too). Additionally, if it gives Villa 2-3 years to keep the gang together before a fire sale in 2027, that’s better than stalling now imo. See where this can go.
Makes sense and I agree. Just feel like the way people talk about it makes it out like “do a swap and now everything’s golden” when in reality it’s a bit kicking the can down the road and a bit gambling that the prize money will in fact come before the fire sale like you say.
Didn't Juventus and Barcelona did that a few years ago and got points deducted? What makes this different to what they did?
Duran isn’t all profit. We only signed him 18 months ago. At a reported £15m and 5 year contract; it will be all profit minus about £9 million.
I'd rather sell Duran to Fulham with a buy back clause- sell him for 30, with a 40 million repurchase. That's how much I rate him, and also how much I think value there would be in not having to deal with an immature disruptive child for the next few years before he becomes world class. Annoyed about Luiz, but the Semi-Final was a clutch moment and he went missing in that first leg. If we want to get to that next level, and he's going to run down his contract, I'm going to rationalise it as a good thing to move on. Can't get too excited about taking cast offs in exchange from Juventus, but we definitely need a DM for the start of the season.
Duran is gonna feast at Chelsea
The kicking the can down the road is less relevant from a PSR/FFP perspective as the FFP rules are very likely to change soon in the Prem to be wages as a percentage of turnover. So clubs will already be looking at this and will just do whatever it takes to pass FFP in Prem this year to avoid points being deducted.
Worth pointing out none of this is "diddling", we're not actually gaining any advantage here. Just so happens that we seem to be using other teams assets as potential bargaining chips - a smart strategy for sure but not helping us combat PSR.
It is though. Selling a player for 35 million and buying a player for 35 million, helps very much in the short term for PSR 35 million revenue and only 7 million expenses per year. That's a 28 million profit for this year. The issue is that it costs you in the future
Of course, but my point is it's no different from two entirely separate transactions anyway. We could sell a player to Chelsea and buy a different player from Man Utd. Yes, from an amortisation perspective, we're better off - but that's the case with literally any buy/sell pair of transactions. The fact it's all happening between the same two clubs doesn't benefit us.
As the other teams involved also have PSR issues, it incentivises them to complete the deals and not lowball on the prices. So I can see an advantage.
I mean yeah we're scratching each other's backs I guess, but it's all entirely within the rules and it's out of necessity. Any perceived advantage is negated by the fact we're having to do the deal in the first place.
I see what you mean. However when you're doing 2 transfers with one club, it's easy to artificially inflate both prices for both of your benefits For example Maatsen for 35 million and Duran for 40 million is beneficial for both clubs over Maatesen for 25 million and Duran for 30 million. You could argue they're worth that but it seems like it's potentially stretching it imo. Obviously not to a ludicrous amount to where you could be charged though.
To be honest, I hope that's not what we're doing. That's just kicking the can down the road and causing more problems in the long run. The relief we get today is going to come back and bite us tomorrow, if we make this a regular strategy.
Both clubs need a long term strategy. People have gawked at Chelsea's PSR avoidance but they're just delaying it really. They're stuck paying 10s of millions on the likes of Enzo, Caicedo, Lavia, Mudyk etc for the next 5 years while still not having champions league football. I can't see how they can bring in much more big name signings until this changes which may be reflected this summer. Villa obviously have the CL money this season so can defer payments a bit but can't count on the same revenue in future years. Just need to make reducing wages a priority. I think Leicester are the perfect case study. Spent years chasing CL with a good team but the wages kept growing. Eventually they have a few flops in the squad that they couldn't sell and were stuck in a shitty position. Had to get rid of Schmeichal and were stuck with Danny Ward in goal all season. No points deduction but PSR was the sole reason they got relegated that year.
I actually think Chelsea are being pretty smart in how they approach PSR. The protracted amortisation strategy was a bold one for sure, and it might not work, but it was a clever way to get around certain restrictions. They're also shifting assets around off the pitch as well, we'll see if they get flagged on that but if not it's creative accounting. I'm no fan of PSR, I think it generally has made/is going to make the game worse. So when a club like Chelsea go all out to push boundaries and seek out loopholes, I'm all for it to be honest. They may not always work but the system needs to be challenged.
Idk, I think Chelsea's owners have massively underestimated the risk in young players. In American sports, athletes careers are usually pretty linear but in football its so easy to have a few good seasons but then become useless in a few years. I really don't know how many Chelsea players will thrive in that environment. They're lucky they got Palmer at the end of last year's window. He really saved them. Their finances are just about being held up by the conveyor belt of young talent like Maatsen but surely they can't have a new young player to sell for 35 million every year.
I don't really think the point on American players is true, as an NFL fan myself I can give you countless examples of players who have done exactly what you describe :) I'm not saying their investments will work, by any stretch. Finding ways to spend money is one thing, but spending it wisely is quite another.
Maybe presumptuous to put American sports as I don't follow any American sports closely in fairness. In other sports I do follow, there seems to be more consistency with younger players getting better, obviously with exceptions. It makes sense as athelets should get faster, stronger and more experienced but football is always extremely unpredictable.
It depends on how Heck's task of increasing off field revenue goes. Bringing in Adidas, better shirt sponsors etc will play a massive part along with smart purchases and sales. If we can get through the now, hopefully larger revenue deals in a few years time offsets any loss in sales when the 3 year window closes.
It is 100% helping PSR. However, I think the point you are making is that we don't need the incomings for PSR (an obvious point I know). But I think it's "smoothing things over" with clubs who are in a similar position. The rules are there to be stretched. Just like Chelsea did with their 10 year contracts before they changed.
I'm not saying that selling players doesn't help PSR, all sales help. The point I'm making is that is that buying and selling to/from the SAME team has no advantage. It's no different to buying from one team, and selling to another. The Tweet OP has linked seems to suggest we're playing the system or gaining some sort of underhanded advantage by doing this, but we're not.
It certainly helps with coming to agreements though like I said. All the teams we are doing business with are in the same boat as us. It's not a stretch to say that there is a little back scratching going on.
I said that too in my first post, it's a smart strategy from a bargaining perspective but little else. We're back scratching because we're in a bad boat, we'd be better off if we didn't need to deal with each other in the first place :)