and ?
Is no one allowed to criticize SAF if they feel hes not being 100% truthful..
Lets face it, Fergie has misled the supporters before.
ALL issues relating to the bond issue and club finances
- Thread starter sammsky1
- Start date
- Status
and ?
Is no one allowed to criticize SAF if they feel hes not being 100% truthful..
Lets face it, Fergie has misled the supporters before.
No it's not.
Companies do have to pay interest and taxes, but they can choose the level of depreciation and amortization. To write off goodwill, amortisation of players registration is a way of avoiding taxes.
Last years (2009) figures was 8.875m (depreciation), 37.641m (amortisation of players registration), 35.388m (goodwill).
If you are intrested. To write off goodwill and registration is a good thing.
4 hard truths...
Father Christmas doesn't exist.
Your Dad can't beat up anyone in a fight.
One day you, along with everyone else you Love, will die.
Sir Alex Ferguson is the manager of a football club that is hundreds of millions of pounds in debt and it IS effecting his transfer options.
Now why would we do that...
Oh no! You've caught RoodBoy disease. Also known as arbitrarily ignoring cash expenses such as transfer fees, which don't fit in with your totally fatuous argument.
Moral of the story: when you haven't a clue what you're talking about... Google it!
I think you've missed roodboy's point completely, Fred, perhaps you should go back a few pages and re-read. Or, just Google 'finance' and copy/paste us your degree.
There are none so blind as those that just dont want to see.
You're all insane... going around in circles!
EBITDA or no EBITDA it looks like we aren't going to go tits up Leeds style. Whether or not we he have money for the squad is another story. I tend to believe SAF when he says the squad is good enough bar 1 or 2 signings, and I believe Gill (shock horror) when he says the money is there for that.
All I want is for the Glazers to stop rinsing the fans, clear off the debt and let the gaffer manage...
EBITDA or no EBITDA it looks like we aren't going to go tits up Leeds style. Whether or not we he have money for the squad is another story. I tend to believe SAF when he says the squad is good enough bar 1 or 2 signings, and I believe Gill (shock horror) when he says the money is there for that.
All I want is for the Glazers to stop rinsing the fans, clear off the debt and let the gaffer manage...
unless we get a mega rich owner like say city or chelsea...
come on mr gates... feck giving your money to some fecking foundation... you can even stick a fecking microsoft logo on the shirts...
We have a winner.
Exactly.
I don't think there's a poster here who thinks we're about to do a Leeds, but for some reason there are some who are determined to put all their efforts into trying to discredit or at least water down any anti-Glazer talk. I've never been able to work out the motivation for this, it seems a waste of energy to me at best.
But you are going to get only ONE of them at very best.
THe fans will be rinsed to hell and back,
The debt isnt going to be cleared off
And once Fergie is gone, whos to say how they will run things...
A leeds type situation is very unlikey, but its NOT impossible.
One disastrous season and the whole pack of cards can collapse.
Because some people want to have a proper understanding of what is happening rather than spouting blindly inaccurate propaganda because they have come to hate glazer more than they love united. If you want to spout that drivel go on red issue and 99% of posters will suck you off.
Bollocks.
So its beyond all the realms of possibility that United could fail to finish in the top 4 next season thus starting a spiral...
Because thats what happened to leeds.
They spent on the false assumption that they would qualify for the CL, and when they failed, they had committed so much money in terms of wages and fees, they couldnt cover those costs.
If they had qualified for the CL like they expected, they wouldnt have hit the shit slope that they did, and Ridsdale would have been paraded round Leeds City centre like a god..
The amount of money that the top 4 clubs get for the CL can make all the difference between a club making shit loads of money, and collapsing totally.
Why do you think the scousers are shitting their pants and Gillette and Hicks are bailing out. Because they know damn well that without that CL money their business plan is completely fecked.
You are saying that United are guaranteed to make the top 4 every season until 2017...
Leeds never had the revenue base we have fred.
What has that got to do with it..
Portsmouth are in the mess they are in, not because they dont earn as much as United, but because they spent more than they were bringing in.
The money coming in isnt the problem when a club goes bust.. Its the money thats going out.
A club that makes £1000 in a season can be more profitable than a club that makes £100 million. As long as they control costs.
Leeds gambled that they would hit the CL, and budgeted for CL revenue, which they didnt in the end, receive. The next season it wasnt the loss of the CL revenue that fecked them.. it was what they had committed themselves to.
United have players on contracts. If they fail the make the CL next season those players still are entitled to the wage set in that contract. The fact the TV revenue, the gate receipts, the sponsorship revenue has fallen isnt their problem.
So what do United do ? THey are paying players CL money but getting no CL revenue ? Do they sell those players to cut the wage bill thus weakening the team ( like Leeds had to do ) or do they keep them and run the risk of going bust altogether because they are paying out what they cannot afford.
As I said, a Leeds situation isnt likely, but its possible, and if you dont believe me, look down the East Lancs Road. Liverpool are fecked with capital F because you can bet they will be offloading all the highest earners as soon as they can if they are unable to sell the club and quickly.
Its not that they arent getting revenue. Its that they've committed themselves to wages and with no CL revenue coming in, they cant meet those payments.
But that's YOU innit.
I knew I'd find it eventually.
This is what I want you to explain.
Why would you add amortization of goodwill back into the cashflow ?
Right, you can start by telling me why you would discount amortization of goodwill from the cashflow.
Actually, could someone start by explaining what the flippin heck an amortization of goodwill to the cashflow even means? Cheers
I'll play rude boy since he's not here. Basically goodwill is the price Glazer paid for Man Utd above the asset value which was about £800M to an asset value of £300M. Hence he's allowed to defray that expense in the accounts in in subsequent years. Hence, when he accounts for £38M in goodwill write-down that isn't cash going out of the business - which is why our man added it to the cash flow.
When Glazers bought the club the club had assets ( players contracts, ground, training ground, typewriters, pencils ). These are all added up and called TANGIBLE ASSETS. They are physical items with a cash value.
Then of course there are things which technically do not have a physical presence but are important when running a business. A prime example would be know-how. Fergies wisdom, whilst unique to United plays a large part in making the business succesful. Therefore for accountancy purposes this has a cash value attached to it. Because it doesnt have a physical form or cannot be measured precisely, it is called an INTANGIBLE ASSET.
When the Glazers bought United the PLC would have said "well look, you want our business that we have built up. You can have all our TANGIBLE ASSETS, plus you have to pay us for our INTANGIBLE ASSETS as well because without that know-how you wouldnt have a business."
LIkewise the brand name has a value to the buyer. Whats the use of having Old Trafford and the players if you cant use the name Manchester United.
On top of that, they would evaluate what the PLC would have made over a given period in profits. Supposing United made on average £50 million a year over the previous 10 years, then they would go to the Glazers and say "we want you to compensate us for what we would have made in the next 10 years had we still owned the club"
Now technically this is an intangible asset, but in accountancy, because it is actually has a physical cash value that can be measured, then it is listed seperately. Some argue that it doesnt have a cash value, but that is in fact incorrect. Let me put it simply, as it was taught to me.
Goodwill is paying for the potential of a business over a defined period. Lets for arguments sake say that over 10 years the company would make £200 million. On average that is £20 million profit per year.
Therefore when you buy Goodwill, you are putting a cash value on potential. You are saying that each year you expect to make £20 million. If you make less than that then you havent realised the potential. If you make more than that you are doing better than what you expected.
So for 10 years as you get to each year end, you look at what Goodwill you have paid, and you measure it against what you have achieved.
because you paid a cash price for that potential, after the first year, you have used up 1 years potential. You dont have that anymore. Your first year is complete, and you have 9 more years potential earnings. 9 years potential earnings is £180 million. That drop in the potential earnings is called the "amortization". Basically its saying that as each year passes, you have either made more money than you expected ( and indeed paid for ) or you havent made as much money as you paid for. Naturally, as each year passes, the potential earnings decrease, because once a period has gone its no longer potential. It turns into what you physically earned.
Or another way of looking at it.
You have given the seller your profits for 10 years based on what they have earned. Each year you would have made £20 million, but you are giving it to them as compensation for taking their business from them. Its up to you then to make sure that you earn more than £20 million every year else you will be running at a loss.
At the end of the first year, you have only made £15 million profit, but you paid the seller £20 million. Therefore you have lost £5 million. If however you have made £30 million, then you have made more than the £20 million you paid for the first years trade and you have made a profit.
At the end of the 10 year period there is no more potential. You look at the books and say " I paid £200 million for the 10 years earnings, and I have made £300 million. Therefore I am £100 million in profit"
To cut a long story short, Goodwill is an intangible asset with a tangible value, and each year you decrease your cashflow by that amount, because its one years potential that you no longer have but you paid a cash value to get it.
Oh, surely even you can see the irony in that short sentence?
Not in the slightest.
Are you fecking kidding? You do a bit of googling and suddenly you're the expert. Fecking genius.
Its cash thats already GONE out the business.
Call it payment in advance if you like.
The PLC could have said "well each year we want £38 million compensation for 10 years"
Would it have been shown on the cashflow ?
Goodwill is an upfront payment for something that will occur in the future. Hence you have to deduct it from the cashflow, because its a payment in advance.
well show me where I am wrong then.
why doesnt that surprise me.
No, it's cash that went to M&M and co to buy the shares in the business. It didn't go through the company books. It's basically a tax rebate to Glazer for what he paid over the asset value.
I didn't say you are wrong but patronising peterstorey over his explanation is ridiculous when you clearly didn't have a fecking clue until you asked Jeeves sometime today.
There are some arrogant cnuts on here.
Then I pity you in the same way as I do Daily Heil readers who put stock in phrases like "political correctness gone mad" then.
"hate glazer more than they love united" indeed... it really is the most non-thinking thing that gets postd in these threads.
If M+M said to Glazer you can have United but we want compensation every season for the profits we would have had, and Glazer agreed to pay £38 million every year for a period of 10 years to them..
Would that show on cashflow each time they paid him £38 million?
He would have a liability of £380 million over 10 years correct ?
Once he's paid one years installment, how much does he owe them over the coming 9 years left ?
Firstly, its not ridiculous if I am right, and he is wrong.
Secondly, you clearly dont understand it yourself, so therefore, how can you possibly know that I dont know anything about it.
I dont understand chinese, so it would be a bit rich me telling a chineseman he's not talking proper chinese...
Fred if i were you id give it a rest mate, you clearly havnt got the foggiest clue about what your attempting to talk about hence why your constantly getting corrected by more clued up individuals......people are laughing at you now and im starting to feel embarrassed for you, your clearly searching the internet for definitions of what half this stuff means and the other half is simply going way over your head...…Leave the analysis to Roodboy, someone who’s actually displayed an understanding of all this throughout, something you clearly haven’t.
Well you might argue that... and if even you were successful you'd still end up saying that Glazer paid M&M for their notional 10-year excess profit in 2005 and Red Football are now busy putting it back in their trousers.
- Status