Generic clubs in financial crisis Thread

[Barry the bird boggler]

I didn't want my money used to bail out the banks, now it looks like its those banks are going to be use that money to bail out a badly run football club. No way!

[Wax Jacket]

I'm hearing you Barry but the flipside is that it'd be nice to see clubs handed over to supporters, in general. not that it worked for Notts County.

[wolsey]

Rangers confirm club being investigated over tax issue

Rangers have confirmed that the Scottish Premier League club is under investigation by Her Majesty's Revenue and Customs (HMRC) over a tax issue.
BBC Scotland has learned that the investigation relates to payments made into offshore accounts.
The club is still up for sale with estimated debts of about £30m.
BBC Scotland has also learned that the investigation does not signal an end for the proposed takeover by businessman Andrew Ellis.
"There is an ongoing query raised by HMRC which is part of a pending court case," the club said in a statement.
"On the basis of expert tax advice provided to Rangers, the club is robustly defending the matters raised.
"It would, therefore, be inappropriate to comment further at this stage."
The club have been unable to purchase a player for 20 months as Lloyds Banking Group tries to control the £31m debt.
Three transfer windows have opened and closed without the Ibrox club bringing out their cheque book.
The last arrival was American midfielder Maurice Edu, who they signed from Toronto in August 2008.
Despite their financial problems, manager Walter Smith has guided Rangers to two successive league titles.

http://news.bbc.co.uk/sport1/hi/football/teams/r/rangers/8647085.stm

[TFF]

High-earning Jimmy Bullard wants to stay at debt-laden Hull City

Hull City's already slim hopes of offloading Jimmy Bullard this summer received a setback today when the midfielder signalled his intention to see out the remaining three years on his £45,000-a-week contract at the KC Stadium.

A source close to Bullard said: "Jimmy is not seeking a move at all, he is happy to stay at Hull." Selling the injury-prone former Wigan and Fulham playmaker was always going to be tricky as Hull bought him from Fulham for £5m 15 months ago despite Bullard failing a medical.

Paul Duffen, the former chairman at the KC Stadium, subsequently admitted that the club had been unable to take out insurance on their record signing as Bullard's knees were uninsurable.

Realistically, the only way anyone might be tempted to recruit him would be on a pay-as-you-play basis but the fragile kneed 31-year-old is not prepared to exchange a basic £45,000-a-week – and with assorted add-ons that remuneration rises to around £50,000 – for such insecurity.

Hull, who have commissioned an independent audit of their finances, are £35m in debt, in effect relegated from the Premier League and trying to stave off the threat of administration or the need to enter a Company Voluntary Arrangement. With the atmosphere between the club's owner Russell Bartlett and the chairman Adam Pearson extremely tense, it is not impossible Pearson could resign. For the moment, he is working to reduce the player wage bill from £40m a year to £15m while also helping restructure the debt by re-negotiating loans with various creditors.

It helps that, due to high earners including George Boateng being out of contract this summer and a series of loan deals involving players such as Jozy Altidore ending, natural wastage means the wage bill is expected to drop significantly by July. Although the club intends to make a announcement regarding their future direction at the end of this week the next two months will be critical in averting administration or a CVA and the attendant deduction of 10 points by the Football League.

Much depends on whether Hull can meet an outstanding £4m plus tax debt to HM Revenue and Customs. It would help if they could swiftly sell the midfielder Stephen Hunt. He is valued at around £5m but is recovering from a broken foot and will not be fit again until August, thereby missing pre-season training at a new club. This makes him less attractive to potential suitors and, apart form delaying any deal, may force his price down.

Even so Bartlett's biggest current worry will be the potential loss of an increasingly disillusioned Pearson. Acknowledged as one of the brightest financial brains in football Pearson was brought back to the club he rescued from extinction in 2001 and sold to Bartlett in 2007, last winter in the wake of Duffen's abrupt departure following an auditor's warning from Hull's accountants Deloitte.

Can't blame Bullard for wanting to stay - his career's effectively over.

Pompey MkII

The Premier League will be glad they're the Football League's problem.

[Messiah]

Fair play to the player. It's not his fault they were so stupid.

Hull City's already slim hopes of offloading Jimmy Bullard this summer received a setback today when the midfielder signalled his intention to see out the remaining three years on his £45,000-a-week contract at the KC Stadium.

A source close to Bullard said: "Jimmy is not seeking a move at all, he is happy to stay at Hull." Selling the injury-prone former Wigan and Fulham playmaker was always going to be tricky as Hull bought him from Fulham for £5m 15 months ago despite Bullard failing a medical.

[weybridgewanderer]

Rangers confirm club being investigated over tax issue

Rangers have confirmed that the Scottish Premier League club is under investigation by Her Majesty's Revenue and Customs (HMRC) over a tax issue.
BBC Scotland has learned that the investigation relates to payments made into offshore accounts.
The club is still up for sale with estimated debts of about £30m.
BBC Scotland has also learned that the investigation does not signal an end for the proposed takeover by businessman Andrew Ellis.
"There is an ongoing query raised by HMRC which is part of a pending court case," the club said in a statement.
"On the basis of expert tax advice provided to Rangers, the club is robustly defending the matters raised.
"It would, therefore, be inappropriate to comment further at this stage."
The club have been unable to purchase a player for 20 months as Lloyds Banking Group tries to control the £31m debt.
Three transfer windows have opened and closed without the Ibrox club bringing out their cheque book.
The last arrival was American midfielder Maurice Edu, who they signed from Toronto in August 2008.
Despite their financial problems, manager Walter Smith has guided Rangers to two successive league titles.

http://news.bbc.co.uk/sport1/hi/football/teams/r/rangers/8647085.stm

A tax loop hole that many clubs (and potentially other business) will be using. i suspect a number of clubs will be nervous about any outcome!

[weybridgewanderer]

High-earning Jimmy Bullard wants to stay at debt-laden Hull City

Hull City's already slim hopes of offloading Jimmy Bullard this summer received a setback today when the midfielder signalled his intention to see out the remaining three years on his £45,000-a-week contract at the KC Stadium.

A source close to Bullard said: "Jimmy is not seeking a move at all, he is happy to stay at Hull." Selling the injury-prone former Wigan and Fulham playmaker was always going to be tricky as Hull bought him from Fulham for £5m 15 months ago despite Bullard failing a medical.

Paul Duffen, the former chairman at the KC Stadium, subsequently admitted that the club had been unable to take out insurance on their record signing as Bullard's knees were uninsurable.

Realistically, the only way anyone might be tempted to recruit him would be on a pay-as-you-play basis but the fragile kneed 31-year-old is not prepared to exchange a basic £45,000-a-week – and with assorted add-ons that remuneration rises to around £50,000 – for such insecurity.

Hull, who have commissioned an independent audit of their finances, are £35m in debt, in effect relegated from the Premier League and trying to stave off the threat of administration or the need to enter a Company Voluntary Arrangement. With the atmosphere between the club's owner Russell Bartlett and the chairman Adam Pearson extremely tense, it is not impossible Pearson could resign. For the moment, he is working to reduce the player wage bill from £40m a year to £15m while also helping restructure the debt by re-negotiating loans with various creditors.

It helps that, due to high earners including George Boateng being out of contract this summer and a series of loan deals involving players such as Jozy Altidore ending, natural wastage means the wage bill is expected to drop significantly by July. Although the club intends to make a announcement regarding their future direction at the end of this week the next two months will be critical in averting administration or a CVA and the attendant deduction of 10 points by the Football League.

Much depends on whether Hull can meet an outstanding £4m plus tax debt to HM Revenue and Customs. It would help if they could swiftly sell the midfielder Stephen Hunt. He is valued at around £5m but is recovering from a broken foot and will not be fit again until August, thereby missing pre-season training at a new club. This makes him less attractive to potential suitors and, apart form delaying any deal, may force his price down.

Even so Bartlett's biggest current worry will be the potential loss of an increasingly disillusioned Pearson. Acknowledged as one of the brightest financial brains in football Pearson was brought back to the club he rescued from extinction in 2001 and sold to Bartlett in 2007, last winter in the wake of Duffen's abrupt departure following an auditor's warning from Hull's accountants Deloitte.

Can't blame Bullard for wanting to stay - his career's effectively over.

Pompey MkII

The Premier League will be glad they're the Football League's problem.

[weybridgewanderer]

Rangers confirm club being investigated over tax issue

Rangers have confirmed that the Scottish Premier League club is under investigation by Her Majesty's Revenue and Customs (HMRC) over a tax issue.
BBC Scotland has learned that the investigation relates to payments made into offshore accounts.

http://news.bbc.co.uk/sport1/hi/football/teams/r/rangers/8647085.stm

A tax loop hole that many clubs (and potentially other business) will be using. i suspect a number of clubs will be nervous about any outcome!

Well that did not take long to find ....

Arsenal get £11m tax-dodge bill
Robert Winnett
Recommend?
ARSENAL football club has been hit with a bill of nearly £12m after an investigation into a tax dodge used on payments made to players and agents.

The north London club is set to be the first high-profile victim of a campaign by HM Revenue and Customs (HMRC) against tax avoidance in the game.

Arsenal set up a series of front companies and offshore trusts to reward its stars and save millions in tax every year. On average, players were left paying about half the 40% tax rate for high earners.

The scheme, revealed in The Sunday Times last year, is now considered illegal by HMRC, which is demanding at least £11m back tax.

Payments of more than £4m to agents have also been ruled not to be an “acceptable business expense”. Arsenal must pay an extra £700,000 Vat on these.

[wolsey]

Rangers confirm club being investigated over tax issue

Rangers have confirmed that the Scottish Premier League club is under investigation by Her Majesty's Revenue and Customs (HMRC) over a tax issue.
BBC Scotland has learned that the investigation relates to payments made into offshore accounts.

http://news.bbc.co.uk/sport1/hi/football/teams/r/rangers/8647085.stm

A tax loop hole that many clubs (and potentially other business) will be using. i suspect a number of clubs will be nervous about any outcome!

Well that did not take long to find ....

Arsenal get £11m tax-dodge bill
Robert Winnett
Recommend?
ARSENAL football club has been hit with a bill of nearly £12m after an investigation into a tax dodge used on payments made to players and agents.

The north London club is set to be the first high-profile victim of a campaign by HM Revenue and Customs (HMRC) against tax avoidance in the game.

Arsenal set up a series of front companies and offshore trusts to reward its stars and save millions in tax every year. On average, players were left paying about half the 40% tax rate for high earners.

The scheme, revealed in The Sunday Times last year, is now considered illegal by HMRC, which is demanding at least £11m back tax.

Payments of more than £4m to agents have also been ruled not to be an “acceptable business expense”. Arsenal must pay an extra £700,000 Vat on these.

Will probably add to Portsmouth's woes, what with Sol Campbell's image rights issues.

Who knows, they might be able to get their portion of debts up to 25% (Until Mr Andronicou (sp?) finds some more football related debts that previously knew nothing about.)

[Dirk Gently]

I'm hearing you Barry but the flipside is that it'd be nice to see clubs handed over to supporters, in general. not that it worked for Notts County.

The problem is that whilst some clubs steal money from the taxpayer and others have a rich sugar-daddy throwing free money at them, a supporter-owned, sustainable run club will always do less well on the pitch.

The playing field needs to be levelled so that clubs that are run properly and sustainably aren't at a disadvantage because of that.

[PieEater]

http://www.newsoftheworld.co.uk/sport/8 ... -CUTS.html

CARDIFF CITY have been saved from going bust - but their £6m rescue cash has already GONE.

Now anxious Bluebirds fans have been warned there will be serious cut backs in the summer, even if their heroes secure a dream promotion to the Premier League.

The Bluebirds will avoid being liquidated at the High Court on Wednesday after Far East investors led by property tycoon Dato Chan Tien Ghee - known as TG - agreed to bail out the debt-ridden club. But the money he has handed has already been gobbled up.

Over £1m went in loans to the club for staff wages, while £1.9m will be handed over to Her Majesty's Customs and Excise in court to settle their unpaid tax bill.

Money has also been earmarked to pay off outgoing chairman Peter Ridsdale, finance director Alan Flitcroft and fellow director Keith Harris as well buying more shares.

Alan Whiteley, the man who brought the Malaysian investors to the table and helped broker the deal, admitted: "We'll review our overheads in the summer - whatever division the club is in. Part of that will be obvious cost-cutting measures.

"We'll focus on moving forward. There's been too much focus on our off-field problems, now we want to concentrate on what happens on the pitch."

Another Bluebirds insider said: "The £6m TG has invested is either all gone or accounted for. The club really does have to raise more money - and fast."

The Malaysians are already looking to raise £6m in a new share issue and they are also hoping 6,000 fans renew their season tickets if they fail to go up.

In that case their biggest earners will be offloaded and manager Dave Jones may well move on as well.

The takeover will become official when approved by shareholders on May 27.

So Cardiff find their rich sugar daddy to save them.

[Silver Fox]

Money has also been earmarked to pay off outgoing chairman Peter Ridsdale.

LOLz, nice work if you can get it, where to next for Ridsdale?

[Dirk Gently]

I don't understand how the likes of Cardiff can continue to operate this way.
Do they not understand that you can't spend money you do not have?
The general concept of running a business involves having some kind of budget, these people seem to totally disregard this practice.

Correct - their business plan is essentially "hope for the best" - and hope that someone comes along and rescues thenm in the nick of time.

[T.R.O.L.I.]

The clock is ticking at Sheff Weds following today's releagtion....

[Dirk Gently]

The clock is ticking at Sheff Weds following today's releagtion....

Yep - I expect them to be in administration within a couple of days.

[T.R.O.L.I.]

Indeed - I was trying to find your post from a couple of weeks ago on the same subject but couldn't be arsed to trawl through the whole thread.

[Skyline]

Money has also been earmarked to pay off outgoing chairman Peter Ridsdale.

LOLz, nice work if you can get it, where to next for Ridsdale?

I've got mixed feelings about Ridsdale. On the one hand he's oxf*rd over both Leeds and Cardiff, but on the other hand he's a thoroughly dislikeable chap.

[Skyline]

http://news.bbc.co.uk/sport1/hi/football/eng_prem/8649742.stm

Things could soon get a lot worse for Hull, who have estimated debts of about £35m ahead of their return to the Championship, with the club forced to deny rumours at half-time that they have gone into administration.

HuLOLLOL.

[Royal Lady]

A handy minus 10 points at the start of next season then.

[From Despair To Where?]

Acknowledged as one of the brightest financial brains in football Pearson was brought back to the club he rescued from extinction in 2001 and sold to Bartlett in 2007, last winter in the wake of Duffen's abrupt departure following an auditor's warning from Hull's accountants Deloitte.

So one of the brighter financial brains in football sold their rather dilapidated house and moved into a council house, bankrolled promotion from the 4th tier to the second tier in a manner rivalled only by Al Fayed at Fulham, was replaced by someone who made an ever bigger balls up of the book-keeping, then came back and moaned about his predecesor being a bit dodgy with the finances.

Basically, Hull have no saleable assets bar a terminally crocked and uninsureable Jimmy Bullard on £45,000 a week for the next 2 years and a currently crocked Stephen Hunt who's value is dropping by the minute. They can't even use the ground for colateral because they don't oxf*rd own it.