Embargos, HMRC Payment defaults, non payment of wages, the usual under Dai Wrongge

[skipper]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

[YorkshireRoyal99]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

[Brogue]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

easy, the training ground and Liam Moore. I'm being facetious with Moore of course, just placating Ian. but the training ground did cost over 50 mill

[Snowflake Royal]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

Our income has been between £12m and £16m during Dai's tenure, which is about the same as our non-wage costs. Then wages that are basically all loss of £41m, £37m, £33m, £27m, £22m, £16m... something like that anyway.

[Stranded]

How does a relatovely average club like Reading end up with debts so high?

Like... even duong the terrible period of sig inf average players for 7 mil, and paying silly wages, durely that couldn't add up to nearly 200 million??

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

Our income has been between £12m and £16m during Dai's tenure, which is about the same as our non-wage costs. Then wages that are basically all loss of £41m, £37m, £33m, £27m, £22m, £16m... something like that anyway.

Yep, it's basically all wage related (bar the training ground) - wages covered by "loans" from Dai, which turns into debt. When wages were running at over 200% of income, the level of debt can and does climb massively because not only are we using twice our income to pay players, we still have to pay all the other bills (or Dai did). All goes on the debt pile.

[Sutekh]

I have been asking myself the same question as well, we've spent some daft money on players and wages, but to wrack up that amount in terms of losses over 6/7 years just seems ridiculous.

Our income has been between £12m and £16m during Dai's tenure, which is about the same as our non-wage costs. Then wages that are basically all loss of £41m, £37m, £33m, £27m, £22m, £16m... something like that anyway.

Yep, it's basically all wage related (bar the training ground) - wages covered by "loans" from Dai, which turns into debt. When wages were running at over 200% of income, the level of debt can and does climb massively because not only are we using twice our income to pay players, we still have to pay all the other bills (or Dai did). All goes on the debt pile.

This is the sort of thing the FL should be cracking down on at the time it happens. If a club is racking up debts to its owners and/or directors the FL should immediately sanction and embargo that club pending a review of its accounts. Not wait for a 3 year rolling period to complete so everything gets more expensive, muddier and even more complicated to sort out and the club concerned gets time to find and exploit any financial loopholes that the FL may not have closed off.

[rabidbee]

As I've posted before, when Rick Parry was before the Commons committee, he said the EFL's preference was to move to a squad-cost ratio (I think he said the costs of the squad should be pegged at a maximum of 70% of turnover), instead of the current system, so that the EFL could intervene pretty much immediately (by not registering a player who would push a club over the threshold) rather than waiting to sanction a club for a decision made three years earlier. All of this is part of the on-going negotiations with the PL, though.

[bcubed]

As I've posted before, when Rick Parry was before the Commons committee, he said the EFL's preference was to move to a squad-cost ratio (I think he said the costs of the squad should be pegged at a maximum of 70% of turnover), instead of the current system, so that the EFL could intervene pretty much immediately (by not registering a player who would push a club over the threshold) rather than waiting to sanction a club for a decision made three years earlier. All of this is part of the on-going negotiations with the PL, though.

And I doubt PL clubs would manage this requirement based on the current losses of many PL clubs

[rabidbee]

He discussed it in detail at the hearing, if you want to look back at the video. IIRC, the teams involved in Europe may already be aiming for this level, because of UEFA rules. His other point, besides reforming FFP, was that the parachute clubs have a massive advantage over everyone else. Think the PL wanted a higher squad-ratio for those clubs than for everyone else.

[Sutekh]

He discussed it in detail at the hearing, if you want to look back at the video. IIRC, the teams involved in Europe may already be aiming for this level, because of UEFA rules. His other point, besides reforming FFP, was that the parachute clubs have a massive advantage over everyone else. Think the PL wanted a higher squad-ratio for those clubs than for everyone else.

As part of any changes ALL clubs should be forced to put clauses into ALL their player contracts so that relegation means non-negotiable % wage reductions as well as any associated bonus payments being removed or significantly reduced. Likewise clubs would also include % wage increases etc. should a club be promoted.

[3points]

relating to the accounts ending in June 2022 so we've had a further 18 months of losses racking up but summarises the broad position. If you look at how much Renhe Sports Management owes Great Shine, it was at £220m at that point in time. Hence figures of £250m now being banded around. That figure will, most likely, include his original outlay to buy the club (which I think was about £25m).

As already noted over £50m spent on the training ground.

https://star-reading.org/wp-content/upl ... counts.pdf

[Wycombe Royal]

As I've posted before, when Rick Parry was before the Commons committee, he said the EFL's preference was to move to a squad-cost ratio (I think he said the costs of the squad should be pegged at a maximum of 70% of turnover), instead of the current system, so that the EFL could intervene pretty much immediately (by not registering a player who would push a club over the threshold) rather than waiting to sanction a club for a decision made three years earlier. All of this is part of the on-going negotiations with the PL, though.

Isn't that what is already in place in L1 and L2? It's only the Championship that has the £39m loss over 3 years....

[Hound]

Including all his businesses - understand his core business in China was massively hit by Covid, wonder how much the clown has lost in the last 5 years. Pretty special effort whatever it is

[Snowflake Royal]

Our income has been between £12m and £16m during Dai's tenure, which is about the same as our non-wage costs. Then wages that are basically all loss of £41m, £37m, £33m, £27m, £22m, £16m... something like that anyway.

Yep, it's basically all wage related (bar the training ground) - wages covered by "loans" from Dai, which turns into debt. When wages were running at over 200% of income, the level of debt can and does climb massively because not only are we using twice our income to pay players, we still have to pay all the other bills (or Dai did). All goes on the debt pile.

This is the sort of thing the FL should be cracking down on at the time it happens. If a club is racking up debts to its owners and/or directors the FL should immediately sanction and embargo that club pending a review of its accounts. Not wait for a 3 year rolling period to complete so everything gets more expensive, muddier and even more complicated to sort out and the club concerned gets time to find and exploit any financial loopholes that the FL may not have closed off.

a majority of the FL clubs run by those owners would have to agree to that.

Seems unlikely.

[Snowflake Royal]

Including all his businesses - understand his core business in China was massively hit by Covid, wonder how much the clown has lost in the last 5 years. Pretty special effort whatever it is

I suspect, at best, he's worth half the £950m he was when he bought us.

[YorkshireRoyal99]

Yep, it's basically all wage related (bar the training ground) - wages covered by "loans" from Dai, which turns into debt. When wages were running at over 200% of income, the level of debt can and does climb massively because not only are we using twice our income to pay players, we still have to pay all the other bills (or Dai did). All goes on the debt pile.

This is the sort of thing the FL should be cracking down on at the time it happens. If a club is racking up debts to its owners and/or directors the FL should immediately sanction and embargo that club pending a review of its accounts. Not wait for a 3 year rolling period to complete so everything gets more expensive, muddier and even more complicated to sort out and the club concerned gets time to find and exploit any financial loopholes that the FL may not have closed off.

a majority of the FL clubs run by those owners would have to agree to that.

Seems unlikely.

Yeah that won't happen because as far as the owners' are concerned, they are no worse off, they've still got the money.

[Wanderlust]

Can’t believe what is happening to your club and I hope you get a quick resolution and a chance to reset soon rather than the slow agonising demolition job we had to endure until 4 years ago. We survived - just - and are building back soo we are very lucky and our late owner wrote off 185 million to keep us alive. Even then, we were saved an hour before the winding up order was due to be served. Bury didn’t make it.
Looking back we were and are just happy we exist but we are enjoying life in the lower leagues - a far cry from our Prem years and beating the likes of Atletico in Europe - but strangely, it feels great - and I only hope you get to experience a debt free club with good management that is working it’s way back once this pile of crap ends.

[Lower West]

He discussed it in detail at the hearing, if you want to look back at the video. IIRC, the teams involved in Europe may already be aiming for this level, because of UEFA rules. His other point, besides reforming FFP, was that the parachute clubs have a massive advantage over everyone else. Think the PL wanted a higher squad-ratio for those clubs than for everyone else.

As part of any changes ALL clubs should be forced to put clauses into ALL their player contracts so that relegation means non-negotiable % wage reductions as well as any associated bonus payments being removed or significantly reduced. Likewise clubs would also include % wage increases etc. should a club be promoted.

Takes two parties to agree a contract. Players would only sign one year deals or negotiate an exit clause if the club were relegated.

[rabidbee]

He discussed it in detail at the hearing, if you want to look back at the video. IIRC, the teams involved in Europe may already be aiming for this level, because of UEFA rules. His other point, besides reforming FFP, was that the parachute clubs have a massive advantage over everyone else. Think the PL wanted a higher squad-ratio for those clubs than for everyone else.

As part of any changes ALL clubs should be forced to put clauses into ALL their player contracts so that relegation means non-negotiable % wage reductions as well as any associated bonus payments being removed or significantly reduced. Likewise clubs would also include % wage increases etc. should a club be promoted.

Takes two parties to agree a contract. Players would only sign one year deals or negotiate an exit clause if the club were relegated.

The obvious corollary would be a release clause in the event of relegation.

[Sutekh]

He discussed it in detail at the hearing, if you want to look back at the video. IIRC, the teams involved in Europe may already be aiming for this level, because of UEFA rules. His other point, besides reforming FFP, was that the parachute clubs have a massive advantage over everyone else. Think the PL wanted a higher squad-ratio for those clubs than for everyone else.

As part of any changes ALL clubs should be forced to put clauses into ALL their player contracts so that relegation means non-negotiable % wage reductions as well as any associated bonus payments being removed or significantly reduced. Likewise clubs would also include % wage increases etc. should a club be promoted.

Takes two parties to agree a contract. Players would only sign one year deals or negotiate an exit clause if the club were relegated.

But if it's compulsory for every player contract at every league club it's not going to make any difference as if a player insisted on a 1 year he'd have to make sure he played at the top of his game every season to ensure the best options are available to him in every window, not to mention having to endure the continual upheaval and uncertainty every season that a 1 year deal would bring to him and his family.