[Archived] Rovers £54.5m in debt.

[Stuart]

I can't see how it could Stuart. The embargo can surely only prevent us signing players. But it can't dictate what we offer existing staff. I'd worry more about us being able to sign the youngsters in the first place.

I'm not offering it up as a solution. Just musing whether this is going to be the clubs approach from here on in. They spent good money to get category one status and they have had their fingers burnt signing over the hill players on fat contracts. Maybe the idea is to now go with youth. OK this would be an absolute extreme to playing youth, but with Bowyers back ground and the fact the owners have received their biggest income through sales of Jones, Olsson and Hoilett, maybe they see this as the best way forward.

Just a thought.

No, it's a good train of thought. I just think that 'transfer embargo' is a misleading phrase and we will actually be prevented from signing players on rather than just inter club trading. Are free transfers allowed with a transfer embargo?

[patrickvalery]

No, it's a good train of thought. I just think that 'transfer embargo' is a misleading phrase and we will actually be prevented from signing players on rather than just inter club trading. Are free transfers allowed with a transfer embargo?

I would imagine they must be. The Portsmouth squad is / was almost entirely made up of free transfers and I'm sure they were subject of a transfer embargo.

[Stuart]

http://www.thefa.com/~/media/Files/TheFAPortal/governance-docs/rules-of-the-association/standardised-rules.ashx

[Embargo means a ban placed by the Board on a Club in respect of player registrations,

as more fully defined in Appendix G]

APPENDIX G

Embargo means a ban on a Club signing, re-signing, exercising an option to sign, extending a contract, converting a loan into a permanent transfer, converting a short term loan into a long term loan, loaning or seeking in any way to register a player whether on a contractual or non-contractual basis or as an amateur, trainee, academy, work experience or schoolboy associate other than within any of the Embargo Terms and Exemptions hereinafter contained.

Embargoed Club means any Club subject to an Embargo

Embargo Terms and Exemptions

1. Prior to the start of the season an Embargoed Club will be permitted to sign up to 16 players. The complement of registrations must comprise entirely non-contract players save that it may include players under existing written contract, or players listed on the retained list at the end of the previous season where an option has been exercised prior to the implementation of the embargo.

2. In the event of the playing squad of any Embargoed Club falling below 16 registered players of whatever status then any of its then existing registered players who is the subject of a short term loan agreement may have that agreement renewed/extended up to the maximum permitted period of 93days.

3. In the event of any Embargoed Club having more than 16 registered players then subject to the exceptions hereinafter contained no short term loans may be renewed or extended.

4. In the event of any Embargoed Club having its playing squad fall below 16 registered players and where none of the registered players are on short term loans then the Embargoed Club shall be entitled to sign and register a sufficient number of non-contract players to bring the total of its squad up to 16.

5. An Embargoed Club shall in any event not be entitled to change the status of any of its registered players without the prior permission of the Board nor shall it be entitled to engage any new player under the permitted exemptions, on terms better than those of any player whose departure gave rise to the right to sign any other player.

6. An Embargoed Club shall not be permitted to improve the existing terms of any its registered players.

7. In the event of an Embargoed Club having a squad of 16 or less players, of whatever status, satisfying the Competition that any of those players have a long term injury (for this purpose a long term injury shall mean an injury supported by satisfactory medical evidence stating that the player or players will be unavailable for selection for a period of not less than 14 days) then it shall be entitled to sign a replacement player or players as the case may be on a non contract basis but subject to the provisions of Clause 5 hereof and for a period not to exceed the certification of the long term injury or injuries. A new player registered under this clause must not be nominated on the Team Sheet for any match at the same time as the player he has been signed to replace, and must not be engaged on more favourable terms than the player he has been signed to replace.

8. Where the number of eligible players falls below 11, or 11 excluding a goalkeeper, due to suspensions, a Club may make application to the Board to sign non-contract player(s) to ensure a team of 11, including a goalkeeper, can be fielded.

9. In the event of an Embargoed Club having no fit goalkeeper (again as evidenced by medical certificates) then it shall be entitled to register a goalkeeper for an initial maximum period of 28 days. A goalkeeper registered under this clause must not be nominated on the Team Sheet for any match at the same time as the goalkeeper he has been signed to replace, and must not be engaged on more favourable terms than the goalkeeper he has been signed to replace.

10. In any event if an Embargoed Clubs squad falls below 16 because of exceptional circumstances then it shall have the right to make a written application to the Board of the Competition for its consent to sign sufficient players to bring the number of its squad up to 16 and the Board acting in the interest of the integrity of the Competition shall have the right at its absolute discretion to permit the Embargoed Club to sign sufficient players on non-contract or short term loans to bring the number of its playing squad up to 16 fit players applying the criteria set out in the Exemptions above.

11. Any event being a breach of any Competition Rule (including but not limited to the late delivery of a FRI form) which may give rise to the imposition of an Embargo, shall give the Board the right to impose that Embargo with immediate effect. The Board will in any event procure that a written request for a personal hearing in respect of such a decision will be heard within 7 days of receipt of the request from the Club, notwithstanding the Clubs immediate right of Appeal in accordance with Rule 17.4. Pending any such request for a personal hearing, or any subsequent appeal to The Football Association, the Embargo will remain in place.

12. In the event of an Embargo being imposed pursuant to any breaches of the FRI regulations then the Embargo will not be lifted until 7 days after full compliance by the Embargoed Club with the FRI regulations in force from time to time

13. In the event of any Club failing to comply fully with any agreement with HMRC, whether formal or informal, or the terms of any CVA then apart from any other obligations and penalties within these Rules and Regulations it shall be obliged to inform the Competition forthwith of such failure or contravention and the defaulting Club shall be placed under an immediate embargo. If the Club fails to advise the Competition upon becoming aware of such an event then it shall be subject to such penalty as the Board may impose in its entire discretion including but not limited to deduction of points, fines, suspension and expulsion.]

[Stuart]

Sorry. Didn't have time to read the whole of that before I set off for work.

I think Portsmouth must have used section 7 (less than 16 players) to sign freebies, PV.

[glen9mullan]

Just out of interest, how would a transfer embargo hit us in terms of bringing in youth players? The fact we achieved category 1 status fir our academy means we can cherry pick other clubs young players and pay nominal fees for them right? However, does the embargo prevent us from doing this? I only ask as there was some rule implemented which said clubs don't have to register players under 21 in their 25 man squad or something such like. Would this mean players under this age don't count as full transfers if they join the club on youth contracts? If that were the case we could still collect a good standard of young players and then once they're through the door we'd be free to offer them full contracts.

Could anyone clear this up for me?

We asked Derek Shaw at the weekend how an embargo would work and what it means in sales , signings etc .

He stated should rovers end up with an embargo we can still sign players as we can use a percentage of any sale money .

For e.g if we sell a player who is on £20k a week for say £1 million , then we can bring a player in for a percentage of the £1 million and give him wages which equate to a percentage of the £20k per week.

This lowers the wage bill and allows the club to still operate as a football club .

What that percentage is , I don't know

The biggest problem is , Bowyer has a pool of players he considers part of his plans , and another pool of players who he does not . Some of those who are not part of his plans are on some serious money and on long contracts , in addition these players will not accept a pay off which is less than 1p of their remaining contract . The club cannot find buyers or loan clubs either as those players are content to collect the big money they are on .

Clubs are still seeking advice on the legality of these new rules and a vast amount clubs are in a similar position regarding the threat of embargo. Although clubs are trying to get their house in order it's expected that clubs will mount a challenge against the new rules.

For e.g if you have a player on £30k a week who is out for the season. , should his wages be taken into account as a) he can't be sold and injuries inevitably make clubs short in numbers when they are hit with a number of them

[DavidMailsTightPerm]

It is an interesting point you raise Glen - if Robinson and Etuhu hadn't been injured during the summer it is likely both would have been off loaded saving approx 3m in wages plus any small fee we might get.

[Kamy100]

I was talking to someone at the Football League yesterday and the impression that I got was that while Rovers losses were at the very top end of the scale, there are a lot of other clubs who at the moment would not meet the FFP regulations and would be subject to the same sanctions as Rovers. I think that there is going to be a lot more rumblings about this over the next few months and as Glen says above there could also be some legal challenges.

Rovers along with a number of other clubs are getting specialist advice on this issue.

[chaddyrovers]

In todays LT, Derek Shaw is saying Rovers wont sell any star players but we are still looking to get rid of players who are in Bowyer's plans.

[47er]

In todays LT, Derek Shaw is saying Rovers wont sell any star players but we are still looking to get rid of players who are in Bowyer's plans.

I take it you mean "not" in Bowyer's plans? In any case, do we believe anything Shaw says? If he's being truthful Rovers will presumably refuse ANY bids for Rhodes.

[Rover_Shaun]

Star Players?

Erm, Rhodes and........erm

[McClarky]

Hopefully the club will take the view that selling Rhodes would make such little difference to our perilous financial state we might as well hold onto him for the season. If we get an up front cash offer of say £8M though in January can you really see us not selling him? Might depend on what happens elsewhere but there'll be a fair few Prem teams looking for a goal scorer and with money to burn from the new TV contract and a new manager in place by then.

[Ozz]

We are losing £100,000 pounds A DAY . That really takes some doing, even my Mrs would struggle to do that.

[Paul]

Yesterday I was thinking about the players we want rid of and reading Glen's remarks brought this back to me. Two points come to mind:

How do these men describe themselves as football "players?"

Would any club want to sign. "player" who is currently demonstrating a willingness to sit out a couple of seasons while picking up £1.5m a year?

No one of that work ethic would get a job at our place!

[John]

Thought it was loan albeit it with no interest? Which obviously has to be repaid also, presumably Venkys have got a good relationship with their bank (State Bank of India), however if they refuse to extend facilities clearly we are sunk as no chance of the Rao family/Venkys personally funding BRFC (unless I am missing something).

Is there a Championship league debt table? Would be interested to see how we fair comparatively.

[MrT]

Found this article interesting although it doesn't give a breakdown of individual club debt.

http://www.deloitte.com/assets/Dcom-UnitedKingdom/Local%20Assets/Documents/Industries/Sports%20Business%20Group/deloitte-uk-sbg-arff-2013-highlights-download.pdf

[McClarky]

Is there a Championship league debt table? Would be interested to see how we fair comparatively.

Automatic promotion from this league, that's for sure.

[perthblue02]

It is an interesting point you raise Glen - if Robinson and Etuhu hadn't been injured during the summer it is likely both would have been off loaded saving approx 3m in wages plus any small fee we might get.

Does insurance not cover part of the wages if a player is out injured ? surely with the amount of "injuries" we had under Kean, decent insurance policies would have been sought out by the administration just in case ?

[onlyonejackwalker]

We are losing £100,000 pounds A DAY . That really takes some doing, even my Mrs would struggle to do that.

If my maths are accurate that is closer to 3 miilion per month, not 2 million.

£66,000.00 per day is about right, based on a 30 day month, but what's £33k a day anyway between friends!!!

The Venky's business masterclass in all its glory. Losing £60k per day? You would be frightened of every new dawn.

[broadsword]

Now I'm confused, I thought we just lost £34m June to June?

Funny, the word "lost" makes it sound like you've misplaced it.

[FGS5635]

The crazy thing is that you reach a point where the actual figure doesnt matter

[Tom]

Don't Venkys get 9 out of every 10 decisions right though?

Do we have any saleable assets left outside of Rhodes who would go for about half of what we paid when clubs know we need the cash. Josh king could still be worth a few quid soon but same scenario applies, I suppose Jake Kean is English so we could probably trick someone into thinking he's above average.

[FGS5635]

Don't Venkys get 9 out of every 10 decisions right though?

Do we have any saleable assets left outside of Rhodes who would go for about half of what we paid when clubs know we need the cash. Josh king could still be worth a few quid soon but same scenario applies, I suppose Jake Kean is English so we could probably trick someone into thinking he's above average.

Hanley and dann have a bit of value, but after that its 6 figures rather than 7 for players

[broadsword]

The crazy thing is that you reach a point where the actual figure doesnt matter

Yes, a bit like the US budget deficit, the number is so large it's difficult to appreciate the magnitude of it.

God knows what the bank manager is thinking. I guess as long as the land keep appreciating in value, they're happy. Maybe they're thinking the debt will actually be paid off in land acquisitions.

It's a ticking time bomb, Balaji's running around with it in his hands while it fizzes away and he shouts "oh my goodness", and Wankytash hops around getting ever more confused.

[OJRovers]

There is a solution to FFP if clubs co-operate with each other:

Say Rovers and Leiceser (as an example) are going to record losses £20m above what is allowed.

On the last day of the accounts each club takes a reserve player with only a few days left on their contract - for example Markus Ollson, with nil book value - and sells them to the other club for £20m on a 5 year contract.

Both clubs would record a PROFIT on disposal of their player of £20m, but only record a COST equal to 1 day of the £20m spread over 5 years i.e not much (this method is compulsory under FFP).

The clubs would agree to cancel their debts to each other so there would be no balance sheet impact.

You would have £4m COST a season going through in further years, but then you could just repeat the trick with other players.

[FGS5635]

Can the banks afford not to back us? I mean if we go into administration, where do the banks sit in line to get anything? the players and football debts / plus HRMC would get priority over an indian bank wouldnt they