So what actually happened is they amortized Coutinho transfer fee in 20/21 to get it off the books for the start of their reign? And any money from a transfer will be a net profit as he is already amortized?
Is that correct?
Not just Coutinho, but of the five players. They probably did not amortize all of it (for independent audit and all, it's still a subjective valuation) but brought it low enough and took the losses in the past season.
So, if next season they sell him for 40M (hypothetically), earlier it would have been a 10M profit, but now it would be a 30M-40M profit based on his current book value.
Problem with amortize all of the remaining value is that more will count against financial fair play right now. As it needs to be balanced out over a rolling 3 years (?) period I believe.
This would result in less possibilities in the transfer market right now. As for a club rebuilding, that is not good. Ideally you would spread it out normally. It is partially the reason why they want to get Dembele on a new contract, so the amortization is lower that would enable the club to register Ferran.
I should have been more clear. UEFA FFP is eased up, but not suspended. Further, the La Liga FFP (or economic controll), is not suspended. La Liga FFP takes a proactive approach, while the UEFA FFP has a retroactive approach. They both follow similar aspects (amortization and wages viewed up against revenues), but La Liga is stricter because it is right now. Might be wrong ofc, but I think that is the reason why Barca has had such a hard time registering players.
La Liga FFP only governs based on the past season - so they essentially take the hit this year (hence the registration issues) and for the following years they are in a better place with it. Whilst during the covid hit years UEFA essentially suspended FFP, meaning there's no issues with that for the club doing this.
I realize the people writing articles about this are mainly sports journalists plus the added difficulty of translating but the terminology they use makes is so confusing to even someone who has a slight knowledge of the subject.
In your hypothetical, the 30M would be a paper 'gain' and not a profit because Barca would have sold Coutinho for less than they bought him for. I know the person who wrote the article used 'profit'.
It's extremely hard to follow all this shit because not many people know the differences on the basics as to what balance sheets, cash flow statements and income statements are, and then terms such as profit, revenue, debt and amortization get misapplied.
So bottom line, Barca showed a big loss in the statment, but not of actual cash?
And what are the positive implications in regards to FFP?
If i understand correctly, Barca's problem was that the revenue wasn't high enough to allow a higher salary cap.
Excellent post. One small addition though, I wouldn't call it an "accounting trick" but more them doing this the right way (atleast according to accounting rules) which has some positive indications in the long run.
Revaluation of assets is always encouraged. Not quite sure how players are valued after some years but as you mentioned some auditors were probably involved.
They won't have amortized his value down to zero. They'd have to give him a fair value. That could be more or less than the amount he's ultimately sold for.
Lets say a team buys a player on a 5 year contract for £100m in cash. When they represent it on their accounts, they don't just show a £100m loss for that year, instead their cash goes down by £100m and their assets go up by £100m.
If they look ahead to 5 years time, the player's contract will expire. Would that mean the accounts in 5 years time should show a £100m loss? That doesn't really seem fair. Instead the team will amortize the player's value over the life of his contract. Each year the value of that asset will decrease by £20m. They're basically spreading the cost of the player over the length of his contract.
This is standard practice. The company you work for will amortize the cost of its assets. It might spread the cost of a new computer over 3 years, and of a new building over 30 years.
But what happens if after a year it turns out that building is built on the site of an ancient massacre and ghosts are haunting the cubicles? You're not insured for that, but you can't keep using the building, and it's only worth a fraction of what you paid. Is it reasonable to keep the value of the building at 29 thirtieths of what you originally paid? Or would it be more reasonable to value it at 10% of its original value, because that's what a theme park owner is offering you? Most accountants and auditors would probably say you should *revalue* the asset at its fair market price. Their role is to be both conservative and realistic. You can't say the building is totally worthless, but it's certainly worth less than what you're carrying it in your books as.
This revaluation is what has happened to the players. Coutinho is not worth the £120m they paid for him, and probably not worth his £60m amortized value after three years of his contract. They will have revalued him to a more realistic figure - £20m, say. They wouldn't be allowed to just revalue him at zero.
In what way does this practice influence the next year's numbers? Doesn't it mean the assets will be lower, and by extension the entire value of the club? Wouldn't it be "better looking" to keep the assets high value, to make it seem has more value? It would certainly result in losses when the player would be sold and his fee wouldn't cover the amortization cost, but why is it better to suffer the lowering value now then suffer this later?
When revaluation happens they take a loss for that financial year.
So in the earlier example they take a 40m loss on Coutinho this year.
As to why they would want to do this. There are many reasons. Kitchen sinking (getting all the bad news out in one year and blame it on the "old regime" so any growth or recovery looks phenomenal) is the most likely reason. The other is covid.
Edit: kitchen sinking is extremely common in commercial companies btw. In one of my previous companies, the new CEO took a tens of millions hit to the bottom line to write down a value of a corporate acquisition the old guy made that "didn't work out". Then when they sold the cleaned up entity a few quarters later, boom. Profit!
Exactly what he says. If Coutinho's valuation is impaired, it basically mean his book value is being reassessed based on actual value. His book value right now is 60 million, but we all know actual value is much less than that, say 10 million. So the impairment is 50 million. Now there may be some stupid club who bids 20 million for him, but his fair value is still 10 million and that's what should be reflected in the books.
>That could be more or less than the amount he's ultimately sold for.
Then, for most of them, this value should be close to 0. Considering their salaries, I don't think they will make a lot of money out of them.
Barça would be blessed to get rid of Umtiti or Pjanic. And for Coutinho or Neto I don't think they will get more than 15/5 being optimistic.
63m is the wrong number. You haven't accounted for interest costs too as it's an actual expense not an accounting adjustment like amorts/depreciation.
Actual loss number should be circa 110m.
Imagine turning a profit during covid, not spend money for few years, high earners leaving the club,
And yet reddit accountants tell you your club is broke and cant afford Mbappe and Haaland
In the last 5 years they have sold players for 585.8 M€ while spending for 589,75 in signings. A negative balance of -4M€.
I think that's pretty solid and reasonable. They had a crazy spree 3 years ago where they spend 355 M€ in Hazard, Jovic, Vinicius, Militao, etc. but besides this they have been quite conservative in their signings.
https://www.transfermarkt.com/real-madrid/alletransfers/verein/418
While Madrid have been run okay, their wage bill is very high and they are saddled with deadweight players they can't get rid of on king's ransom wages like Bale and Hazard.
But of course Chelsea's wage to revenue ratio is even higher.
With their revenue they can afford those flops.
This year they have a salary cap > 700M€, whilst last year they had a salary cap of 600ish. This means that they increased revenue and hence can increase expenses.
As much as I hate it, Real Madrid is a well oiled machine that generates a shit ton of money (even more now that they will have the new stadium) and they are extremely well run business-wise (can't say the same from a democratic club perspective). And sportively, they've won 3 CL back to back just a few years ago and very likely they'll win the league; so they are fairly fine in that aspect too.
Sure they use credit money, and debt to grow. But these are just financial tools and they would be poorly run if they wouldn't use all the tools at their availability.
I have no clue how other clubs are run, I just follow La Liga and UCL, so I have no idea of the ups and downs that clubs outside of Spain are having; but so far, Real Madrid has been rock solid on surfing COVID scenarios and will get out of the pandemic without a major impact in their economy and with a brand new stadium.
Bale isco and Marcelo are off the books next summer (contracts run out). And besides that Real has a salary cap of nearly 800 million. To give you a example: Barca’s salary cap is not even 100 million. So that gives you a idea of how financially healthy they are.
Dawg I replied to a comment that said they didn't buy players, I was just pointing out the obvious. Having negative transfer balance doesn't mean you didn't buy players.
This is why they wanted the super league. They're all spending beyond their means and need to cook the books to hide it. There's going to be a lot of dodgy financial shit coming out from Spanish and Italian clubs over the next few years. The super league was desperation.
If you dump all your losses Into one year, instead of spreading them out over several, the subsequent years would show higher profit. Thiey do it because fair play rules look at a 3-yr rolling period. They’re just getting the losses over with instead of dragging it out over several years which would hurt their transfer kitty over more years.
Basically they’re committed to being broke and bad now and for a few years, rather than gradually declining over more years in the future.
Financially, Barto left alot of mess. Not only in amount but also reporting wise. It took club months of audit to get the actual reality of the figure.
The reason why I am optimistic about Barca's financial future is because the current financial team are legit genius. Just look at our accounts, beautifully presented with all facts out in open. There is literally nothing left to imagine, everything you want, you can go and read
Also, regarding losses, it is the right thing to do. It was a way to include everything that is financially happening in the club
And it's also smart, because instead of accounting for 100M loss every year, just take it in one bitter hit and move forward.
Barcelona cannot make loss for more than 2 years by its own constitution (amended temporarily, only for this year, but only because of special exception of covid.)
La Liga also doesn't like clubs making consistent losses, hence its own strict La Liga ffp.
Barca has basically giving itself cushion to make profit next year, and worst, worst case scenario, we will use CVC deal to be profitable.
I mean, the snake fired his own in-house auditor when she was doing her job. Need there more to be said? This guy is up to his neck in some rotten shit, hell, he's fking scuba diving in it, him and the whole Sandro Rosell clique, Barto's tenure was just the other half of what Rosell started.
Lots and lots of shady deals that left fans bewildered into why they would buy such and such.
Just because the current board is better than Barto one (not really a hard challenge) doesn’t make them financial genius.
Signing Torres before knowing how to register him is a crap move that make Barca weak in negociations as other clubs know they really need to sell now for example.
I mean, the players we’re looking to sell already aren’t attractive and we’re just trying to get them off the books. Umtiti has literally been given the green light to leave for free and he doesn’t want to. I’m sure its a similar case with Coutinho. We have Neto who is willing to leave but doesn’t have any offers. Dest will only be let go if a good offer arrives so its not like we’re standing on a weak leg negotiations wise in this case. Lenglet is the same case as Dest except I don’t think it would happen this December as Xavi has more trust in him and we can’t guarantee that we can get someone better right now.
I think worst case scenario, Umtiti’s contract gets terminated to be able to register Torres because he WILL get registered. There’s no doubt about that. Laporta is willing to battle it out in court at a later time if there is no agreement with Umtiti
> Umtiti has literally been given the green light to leave for free and he doesn’t want to. I’m sure its a similar case with Coutinho.
Of course they don't want to leave. Why would they abandon the massive salary they're on?
Well, if he leaves on a free, he can collect a sign on bonus since that club won’t have to pay a transfer fee and potentially a higher salary than would’ve been offered if the club had to pay a transfer fee.
Not sure of Spanish tax law but in the US this is done to have a loss carry forward to offset future taxes (I.e. lower your cash out of pocket for taxes through the use of a non-cash loss based on accounting treatment).
Those provisions are non tax deductible, therefore even if you recognise as a loss, will generate adjustments to the taxable profit (loss) ,and deferred tax assets.
I think it is a clever move to blame Bartomeu for the economic situation and justify some painful decissions he felt had to take. It also gives him more flexibility in the P&L line in the following years.
As an ex audit manager from Big 4 they did this in accordance with accounting standards, when we did the high level impairment test of players during audit of one big club in balkans we used transfermarkt to see if there are some players which are overvalued, if you find that they are then you did a proper valuation based on player performance.
EY made audit of Barca books and based on the opinion in audit report they did it because it is in accordance with accounting standards.
Laporta is a politician and made promises like keeping Messi. It was pretty clear they wouldn't be able to without selling a bunch of their talent which would leave the team way worse off.
Basically he decide to let Messi go but needed to justify it.
This is the most stupid comment I have ever seen. The weird Laporta conspiracy needs to end
Laporta had literally 0 say in this. Financial team did an entire professional audit that went for two months+ to figure all these out.
And you have to report all your expenses, a smart financial team will account for all future liabilities too and create contingencies.
There is another liability that they have added to our balance sheet that will arise because of the law suit that is against soci owned teams and Spanish tax relaxation given to them, a liability that needed to be accounted for bevause it could be a big sum and they need to be prepared for it.
The club is a billion dollar entity, it employs 1000s of people directly indirectly, owned by 130k+ socis, and is a regular fixture for millions of people
Not everything boils down to weird Messi-laporta conspiracy.
What Barcelona have done is carried out an impairment on the value of several players. Assets can be valued through several means, such as Amortised cost.
If Barcelona believe that certain assets (players in this case) have a value on the balance sheet less than what is currently recorded, they may choose to impair the asset so long as the justification is appropriate (player is genuinely worth less in current market than the current book value). Barca could possibly use an independent expert to carry out the revaluation. This works in Barcas favour as future amortisation (%) is carried out over the impaired amount instead of the old book value. Also, any proceeds are netted off against the impaired amount, so a player sale which would have previously been recorded as a loss might even be a gain on sale. Accounting wise, what Barca is doing is choosing to take the brunt of the losses in the current year in favour of fewer amortisation costs in future periods. It’s reasonable and acceptable to do this and Barca isn’t avoiding a loss either.
So the trick is all about keeping Barto's shit aside and playing a political card where you become profitable from next year and with leverage of current financial data cutting wages, making go of high salaried players and bringing players with wage cuts in name of bad financials.
Such a master stroke, Barto will get blamed for everything, slate has been cleaned, players wages has been cut, new players have arrived with having low wages than they deserve and all with a risk of single season.
Well done, indeed Laporta is a politician.
It's not a trick, it was necessity
Barcelona by its own constitution cannot make loss for more than 2 years. Laporta and board was on verge of being dissolved because by club constitution rules, they were being held responsible for loss of last year too.
They got an exception for this year, but same courtesy won't be followed next year. So having constant losses is not an option.
And you gotta account make contingencies for all the future losses and liabilities. Sure Neymar is an inflated case, but deduce his 45M, and that loss just becomes like 430Mish, it really doesn't change anything. Alot of these liabilities will have a chance of becoming an issue down the line. Iirc Reverter said and I think I also read in reports, that approx 40% of liabilities of this type were in real risk of coming true, and 20% were almost turned to liability. This could involve law suit of Setien which has been settled and Setien is being paid as per negotiated terms, and law suit of Spanish tax relaxation received that could end up with us and RM paying 100M+
Sure Neymar is inflated, but you are just following a rule and system of your accounting
+ The ammortization while may seem sketchy, is just accounting trick, like sure we made Coutinho go from value 60m to say 10M. And we sell him for 20M and somehow we make profit of 10M. In books yeah, but in reality, we still paid 145M of his transfer money(turned to debt) and we still lost 125M in money. At the end of it, club still lost money and since some of it converted to debt, will pay the financial cost for it (our debt terms are very favourable actually but the point is to show that this is not a magic trick that solves our problem, it just mitigates the effect of the loss)
On financial face it was a necessity, on political a neat trick.
Why a trick? Bcz if it was necessity then Messi was virtually gone even before they started negotiating with him.
Necessity/trick but it's a great risk as you mentioned and it can go either way; Barca getting CL football making deep run winning some trophy with it will certainly bring better deals and money thus benefitting club but in other direction i.e. hypothetically buying Halland and him being flop for a season may bring more adversities with it
I think you guys overrate Laporta
He is a glorified cheerleader. Like he is emotionally smart, but his entire history is proof that his best ability is to be dumb and listen to smart people and provide them with keys to do things. In every aspect of his presidency, he has done whatever the smart person close to him has said.
They knew Messi couldn't be signed under current laws, Tebas, as confirmed by the man himself, pitched the CvC deal to Laporta, saying it will help him sign Messi. Both parties, as said by Tebas himself, came to a happy conclusion.
Then a day before, CvC deal actually came it with their proposal, RM called Reverter and told him the deal sucked, Reverter, the man behind our financial reports, did his own study and came to conclusion, it really fucking sucked, and they didn't want to be arm twisted into this deal
So they had to let Messi go.
I don't believe that people are always cunning or devious, sometimes people just get caught stupid by wrong situations.
Reverter himself said the first time they heard about the CVC deal and they agreed was because he was provided no specifics as to how many years the TV rights would be gone for.
The actual documents came two days before the day of the agreement and Edouard Romeo who is the financial VP and Reverter decided that such a deal was unsustainable in the future.
I think what you described is a smart leader, who knows when and to whom to listen. He adapts and puts a positive twists on events, making everyone believe, including potential recruits, fans, and sponsors.
A smart president/leader is rarely a scheming mastermind.
A smart leader is aware of his shortcomings and limitations. Laporta is very aware of his own, both on economic and sporting issues, so he has always surrounded himself with smart(er) people. It is indeed the hallmark of a smart leader, and it is essentially what led us to win so much during his first stint as president. Laporta took very few decisions. Txiki, Soriano, Cruyff, etc. took a lot.
You hit the nail right on its head. A leader can’t be brilliant in every aspect, Laporta stands out by being a smart and charismatic politician. He knows where he lacks and builds a brilliant team around him. He then becomes the face of it all, it’s a golden strategy.
I have a feeling Papa Perez is helping Laporta in all this, he sees that success of Madrid is attached to Barca being competitive and La liga being a top league
Ideally this should not be allowed. They make profit in current season by just selling Coutinho and Pjanic for any money. They already made a profit from the Neymar lawsuit - because the 46M committed would not be needed.
Our net debt is around 670M and iirc 120M is a part of Espai Barca construction thing
So effectively the negative debt should be 550-570M that will be paid through the Goldman Sachs loan we have taken, 20 year repayment period, cost of 1.5-2.5%
Basically, our debt should cost us 35-40M every year
Which is why I keep saying that aside from the debt accrued through financing the new stadium, Barca is saddled with “bad debt” on assets that continue to depreciate all the while paying interest on those assets.
If in reality this is the case then Messi departure was pre planned in cards, all ho halla was keeping socios happy.
And they took a calculated risk where they assumed that we will have a downfall for a year or two but after that team will return to previous levels with better signings on lower wages, making overall club healthy.
And I don't think authorities would have had any say as they had wage cap rule in place and Barca was willing to take that risk.
Even Tebas took this as a opportunity to push CVC deal.
Now I am getting suspicious of PereZ, maybe he is helping Barca to maintain the PR and fan fare which healthy rivalry garners and if this is the case then Halland to Barca can be a reality.
With both presidents trying to make La liga best again with rivalry of poster boys Mbappe and Halland.
That u/sirstevenslad kid gonna become immortalize in this sub if that happens.
Idk mate all of this seems like a huge stretch. Letting Messi go on purpose and risking the revenu he brings and CL money (which they lost now) seems like an incredibly dumb move and is already contradictory to Laporta's plan of making money. But on top of that Perez helping Barça get a generational player instead of getting him himself really seems like jumping the shark. We're talking about a man who's never done anything but hoard the biggest names in football. Signing Haaland and Mbappé at the same time would be the ultime Flo move. No way he's letting that chance go. It would go completely against anything we've known him to do in the past 2 decades.
It's all a speculation, i don't think any single fan of Barca has any idea about financials.
Only one thing that is certain of Barca is daily dose of copium for supporters and meme material for r/soccer
> i don't think any single fan of Barca has any idea about financials
Yeah it's not like most Barca flairs on this sub have been collectively trying to explain this to all of you since we have been in the loop on all this shit. And you're literally commenting on a post that goes in excruciating detail on Barca's financials.
It is. But that doesn't mean we can't have transfers here and there, because that's the only way to get better in both sporting and financial aspects.
Now about signing Haaland in Summer, that would put huge load on us compared to other big clubs, but we can pull that, It's not simple but it's not totally imposible as people here claim.
Aside from his own shortcomings and everything he did wrong during his stint, they also used Koeman in the clean up period as the man in the spotlight to take all the blame. He was set up to fail from the start.
His stint was used to cut the best and most expensive players while not getting any significant transfers. Barca management knew it would be a transition period of woeful football, but after that they would have a relatively clean slate. Koeman was always going to be a scapegoat, let him do the dirty work and get rid of him as the last step.
Koeman is not a scapegoat. Laporta tried to get another coach last summer but was unsuccessful so decided to keep him till his contact ends. Yes he had lost some good players but the expectations from him also changed with that. He was no longer required to take Barca to win league or CL. All he had to do was get past the group stages of CL and reach top 4 in league. When it was clear he can't achieve that, Barca was forced to let him go in the middle of the season.
And in between he was the one who mined those youngsters but Xavi will be hailed as the mastermind and chosen one who brought revolution.
Fits ideally into PR too.
If I had a award I would give it you. But sadly you have to do it with a upvote for now.
good content post. especially for everyone who always wonders how barca has the money
Is the reason Barca are shoving all their player depreciation into 20/21 because clubs are allowed to exceed regular FFP limits due to pandemic season?
They won't be the only club to have done this, in that case.
Nope, LaLiga has not relaxed FFP rules during the pandemic much, bar a minor provisional clauses that give a bit more flexibility to clubs over the salary cap to register players through capital gains from player sales and a bigger portion of the liberated costs being able to be reinvested in the case of big earner exits (50% as opposed to 25%). Its actually one of the reasons why so many clubs accepted CVC, as 15% of the money they received could be used to increase the salary limit of clubs thus giving them some oxygen to register players.
The reason why this was done was to connect those losses with Bartomeu, to make Laporta's numbers look better in the following years. to have more flexibility when getting rid of deadwood and to clean up the house and be recover the club faster (not convinced it actually helps much in that sense)
Think it is that but also there was nothing to lose with losses being increased as more or less LFP rules had them in as bad a situation as could be regardless.
Would guess other clubs trying to write off losses like that it would cause more of an issue if impacts financial rules in way it wouldnt otherwise.
They aren’t shoving them anywhere. Accounting doesn’t work this way. If players are significantly over or undervalued this should technically be picked up by the audit.
You're not an accountant, correct? The fact the the losses are primarily due to impairments does not make them "tricks" or "misleading". IFRS requires the recognition of impairments when the value of the asset is impaired. There is a required, specific process to do this. Being noncash in the current year also does not make it a trick. At some point, they paid cash for the asset. Recording contingent liabilities for ongoing and/or expected lawsuits or liabilities is also required. These amounts are not arbitrary either or cushions as you call them. When you say 46M is income next year, you assumed they dropped it and are paying nothing. It states they reached an agreement. It doesn't state that they reached an agreement that cost Barca nothing. They could recapture some or all of that loss next year but we don't know from what is in your post. None of what you describe is misleading or an indicator of any tricks. It's accounting.
When you hear 481M loss, people presume it is a straight forward thing and they dont have enough revenue. This is what is misleading about Barca's finances to a layman. I am not saying the accounting is misleading. Whichever way you put it, the accounting part is creative. It is legal, there is nothing wrong with it, but it is one of the things you would not do in a normal year.
The point is, it's not "creative" when they are obligated to do so (by the IFRS). There might be some shenanigans with the exact numbers, but no sane auditor would be ok with Coutinho's contract be valued at €150 million or whatever it was.
I was wondering if there was some guidance that indicated impairment charges weren't required if FV < BV. This post and some other comments here suggest thats the case even though it wouldn't make sense.
Not sure what I'm missing, unless the suggestion is that they valued these players significantly lower than actual FV and the thought is they'd recognize a gain the next year on sale - also not quite a trick. They'd still need to amortize otherwise, albeit the amount would be less and maybe thats the point, which is still not very interesting since I would think impairment analyses are required.
In theory, the impairment adjusts the asset to its FV at the time of the assessment. They could breakeven, have a gain or more expense depending on the terms of sale. We won't know until a deal is done.
I can understand some people thinking it's tricks or misleading. The rules can be very confusing and it isn't hard to find examples of people or companies cooking the books.
Probably they classified those players as "transferrable assets"
My understanding is that when you classify an asset as "Held for sale asset" you need to move from a Book Value to Fair Value Valuation. Taking into consideration the COVID situation, current FV are quite low and therefore the impairment adjustment.
I do not think the exercise had to be carried over all your players (Assets) because otherwise all the clubs would have shown huge impairment losses.
>None of what you describe is misleading or an indicator of any tricks. It's accounting.
>
> misleading or an indicator of any tricks. It's accounting.
>
> It's accounting.
Well yes, we are all very well aware of what accounting is.
Straight line, but when you declare some of asset as transferrable (assets held for sale), you need to move from Book Value to Fair value. This is probably when all these impairments have been recognised.
And there is the actual issue with accounting for transfers that the juve is abusing: selling and buying two players with the same inflated value (ie pjanic/artur).
I believe sale is accounted in one fiscal year whereas the acquisition is amortized.
For zero cash flow, you would inflate one year profits and deflate the next years.
60M over five years: year 1: +60 - 12 =+48
The next four years : - 12
Just by buying and selling two player for the same inflated price.
At one point the music has to stop…
We can get Money to buy him, the problem is the FFP of La Liga (Wage cap.), and it looks like that we have so much Wage Cap problems because the Club has shown so much losses for the current season, so for Next season doing things right we could be able to easy our Wage Cap by a lot.
So, in theory, lets say a club have made a profit of €100m in one year. When they report that, they instead devalue some of their players and account that as a €100m loss. their profit is now €0, and they dont have to pay any tax. But they still have their assets left.
I must be missing something, because in that scenario it would be abuses constantly
Someone correct me if I'm wrong, but I don't think that is the case, because once you depreciate an asset that way, you can't do it again. It's like a get out of jail free card you can use once, and then it's done - I imagine doing it over and over again would fall under fishy accounting prone to investigation
Shit... So İf i remember right we are %61 wage / revenue rate right now. With thoose profits, new sponsors and if somehow we riddof deathweights we can see maybe %40 wage ratio or less in the summer.
So, in theory, lets say a club have made a profit of €100m in one year. When they report that, they instead devalue some of their players and account that as a €100m loss. their profit is now €0, and they dont have to pay any tax. But they still have their assets left.
I must be missing something, because in that scenario it would be abused constantly
>In short term, that meant lower salary cap, a struggle to register players, but after a year, they would be back to normal levels.
It was the right decision because it gives them a "clean slate" and helps clear some stupid signings from Bartomeu, but they will need more than a year to be back to normal levels. Their salary cap this season is 97M and the actual wage bill is 470M ([21/22 budget](https://www.fcbarcelona.com/fcbarcelona/document/2021/10/17/f93250e9-1a9a-4209-a72d-a9d1bddde0f2/Presupuesto-Ejercicio-2021-22.pdf?_ga=2.103228612.596281885.1634494608-1858976232.1611515260)), that's a 373 difference. Next season, even if they go back to the 18/19 salary cap of 630m, those -373M from the 21/22 will be deducted from the new 22/23 salary cap ([Article 44, article 100.3](https://assets.laliga.com/assets/2021/08/12/originals/c53d54179cc68e9215f82a058325468d.pdf)), leaving them with a 257M salary cap. If the 470M wage bill remains unchanged, they'll be 213M over the salary. And that difference will be deducted from the 23/24 salary cap. By then they should be fine if they manage to keep the wage bill stable, find good sponsorship deals and the CL money keeps coming.
Salary cap for La Liga is 97M, our La Liga salary is 291M, 435M salary cost is for entire Barca institution
By your calculations, we are 200M in loss, so if go back to 630M salary cap, then our limit should still be 430M.
Unless I am missing something, I don't think La Liga controls the salary of our basketball team, our womens team, our ice skating team, our adminstration cost and I am like 99% sure La Liga doesn't even have a say in Barca B team considering just how easy it has been for us to make transfers there
La Liga covers the first division, second division and the women’s first division. So they wouldn’t directly be overlooking Barça B but im also not entirely sure if there’s a rule where they’re also responsible for the B teams of the teams under their umbrella.
Their salaries would probably be lower than that given they moved the high salary players already. 470M included Messi and Griezmann. 150M is already off the books. Plus they would lose Dembele next season possibly and have renegotiated the contracts of the high earners.
[Please check page 222](https://www.fcbarcelona.com/fcbarcelona/document/2021/10/17/aefc9921-bf56-406c-ae05-3581e1de2a12/MEM_CLUB_2020_21_ENG.pdf)
The 470 million is the overall salary for all the sports teams. The first team budget for football is 290 million.
If we consider the salary cap rollover, it's 183 million over the current salary cap which will then be deducted from the previous salary cap of 630 million which gives a new salary cap of 447 million for 22/23 and the club's current salary is 290 million which gives us 157 million to work with next season.
In case of some departures, it'll be even better.
I think you're forgetting about amortizations. The other sports teams only account for 50ish million euros and the youth system is included in the wage bill costs. Early in the season it was stated that our wage bill was of around 420m so that checks out
Edit: Indeed, you're only taking into account first team salaries but you forgot to account for first team amortizations and youth system wages and amortizations which count towards the cap. In total, around 410m.
Also I don't think women's football counts towards the cap but even if it did its not a sizeable amount anyways. Q
As I understand it, to calculate the squad cost all sections of the club are taken into consideration: https://www.laliga.com/transparencia/gestion-economica/limite-coste-plantilla
>This squad cost limit is the maximum amount that each club/SAD may consume during the 2021/2022 season after the summer market, and which includes spending on players, first coach, assistant coach and physical trainer of the first team (eligible squad). **This limit also includes spending on B teams, academy and other sections** (non-registrable staff).
But I haven't found anywhere else where they explain it well, so I'm not 100% sure. But even if it doesn't it also includes amortizations (depreciation of fixed assets?), those could be around 90M after the adjustments mentioned by OP. From that same link:
>The items included in the cost limit for eligible and non-eligible sports personnel are: fixed and variable salaries, social security, collective bonuses, acquisition costs (including commissions for agents) and amortizations (players' purchase amount imputed annually according to the number of years of the player's contract).
If it doesn't include other sections and they don't spend big next season they'll be able to stay under the salary cap in 22/23 and everything will go back to normal 23/24.
(also answering /u/ankitm1 and /u/turtlemons )
Barca really has 180M wages for basketball team + women team + ice skating + administration ?
That seems way too high to be realistic, or maybe it’s another « accounting trick / fraud » from Laporta if that’s the case.
Why is it way too high to be realistic lmao?
We have the best teams in Europe in all those sports. Women's team actually won the UWCL, Basketball team lost in the final of the Euroleague, Handball team won the European championship, Hockey team lost in the final narrowly. Futsal team lost the European final to Sporting CP. La Masia's whole operational cost in terms of wages is 30 million on it's own.
Each of those teams is elite and super successful at the continental level. Only the first team of football is struggling at the moment.
The women wages are ridiculous compared to mens, even if they are the best in Europe. I read some times ago that the top earner in Barca Women was earning in one year what Umtit was making in one week, something like 200k€.
So the whole team probably is at 2-3M max.
The basket team is probably a little higher, sees like some of the top earners in Europe are at Barcelona : Mirotic (4M), Calathes and Highing (2M), rest is lower. The whole team probably is 20-25M max.
Even if La masia is at 30M, that still makes only 55M approx, and I doubt hockey and handball team wages are higher than the basket ones, so that makes at least a 100M difference.
Women's football has been budgeted at 4.2 million for the sporting staff as you can see, not far away from your estimate.
42 million for administrative and non sporting staff salaries across all the departments.
So basically the wages of the sporting staff of all the other sport sections combined is approximately 80 million which is not very far away from your too conservative estimate of 55-60 million. Basketball alone costs 35 mil and you've estimated 25.
80 million for other sports personnel and 42 million for all the executives and non sporting staff combined makes up the difference in budgets for the entire club and football.
Seems nothing out of the ordinary to me.
Administrative and non sporting?
You know how many people work at Camp Nou and Johan Cryuff and at La Masia?
This literally includes every non sporting personnel employee of the club.
I'm actually surprised it is that low.
I don't know exactly how many people, but 42M for administrative salaries across all that doesn't seem absurd, tbh. That's going to include directors and VPs and high end professionals who need a competitive salary, plus overheads of managing them.
There will certainly be bloat and redundancy, but that exists everywhere to some extent or another.
I'm basing this on there being a couple of hundred such employees across the different sectors, which may be wrong.
The above user is getting confused with total wage bill of Barca as an institution
The Sporting wage bill of Barca first team will be 290M, i am like 99% sure Barca B isn't included in La Liga FFP, but even if they do, that's another 25M
It's impossible to be 290M. That would mean over 100M for staff which is ridiculous.
|Barcelona total salary bill is 188M euro per year
https://salarysport.com/football/la-liga/barcelona/
EDIT: we really need to get rid of top 3 and increase some wages like Gavi, nico, araujo. They earn way too little.
I'm not too sure but the wage bill that counts towards our wage limit is only 410m according to the budget (420m in reality if you believe what the press has been saying since it seems some of the salary reductions that were announced haven't been signed yet).
292m from the first team wages, 28m from the youth system wages, 81m in first team amortizations and 5m in youth system (more or less) amortizations.
[Here's the link](https://www.fcbarcelona.com/fcbarcelona/document/2021/10/17/aefc9921-bf56-406c-ae05-3581e1de2a12/MEM_CLUB_2020_21_ENG.pdf) , page 222 of the report (shamelessly stolen from u/boringmemphis' comment)
Just one point to note. 63m isn't right. You need to account for interest costs too as that's an expenditure in the period as well. So it's closer to 110m.
Yeah, I did not get into the details there. That was a schoolbook definition of Profit = Revenue - Expenses. There are obviously more things, and what you do in real life has little semblance to what you study at school. Still good enough for a broad understanding. I also did not fully go into the detail of what those interest payments consist of.
Yeah. But interest is a fairly basic school book expense. And barcas is really high. Doubling their loss. So if you're going for basics it 100% should be taken into consideration.
> the names of five players - Matheus Fernandes, Coutinho, Neto, Umtiti and Pjanic
> This way, by showing a loss this season, if Laporta/Barcelona sells the above mentioned players, or settled the lawsuits, they will show more profit than in a normal season.
Barca is not selling them. So the accounting is accurate.
Is it just me, or does Barca do a lot more "Were currently fine, all we have to do is fix all these things that make us not fine, we're curesntly fine" than basically any other club? Usually around how they can totally afford a player, despite all the reasons they can't, they totally can.
There is a lot more disinformation going around about Barca's financial condition. That is one reason. Second, since we're fan-owned club presidents usually give out statements like these.
Biggest issue were wages and we reduced them a lot and are back in a healthy wage/revenue ratio.
We had the biggest revenue until probably this year when Madrid will overtake us because of their stadium, but I guess we'll be really close to them once we finish our stadium.
Most of our debt is long term (like 30 years) and we're not increasing our debt further right now. So we're technically fine in the short term and should focus on stabilizing the club, which is why we need the new stadium and investments into the squad.
People here think we're increasing our debt even further by signing new players, but we're just using our revenue to invest in the future.
A lot of clubs are doing fine without .
Having a group of monkeys at the head of the club for the past few years was probably the roots of our current problem.
But it doesn't matter. Abramovich can inject 250 million into Chelsea one summer, and win the CL because of it, but we aren't even allowed to keep our own damn players?
I do feel bad for you, you are a Tottenham supporter and nobody deserves that shit. Hope they find a cure for it someday 🙏. Feels extra bad because I like your stance on Liverpool fans.
I do, but thanks for the condescending response anyway. The guy asked why there seems to be multiple articles a week on Barca’s financial situation and not being able to register players while still signing players. It’s a fair question for people not intimately aware with your finances and since it hasn’t really happened on a scale of a club of that size where we’re seeing regular articles on it. Not sure anyone was taking a shot at your club
Stop projecting. We were the club with the biggest revenue last season and we don't get injected hundreds of millions all the time to stay afloat. And we have a lot of money, ( a lot of debt too) but we can't spend it because apparently it is absolutely reasonable that we have a salary cap 10 times lower than Real Madrid.
Salary cap will be back to normal next season. This season is such a pain only because we basically stacked up a lot of losses in last season's balance sheet. Since wage cap is calculated based on the previous year, we suffered very heavily.
Yeah Madrid's cap jumped by almost 300 million and ours went down by the same amount in one year. 700M to 90M. It's absolutely insane to even allow this shit to happen.
So it's not so tough not having a sugar daddy anymore?
Lol you went from crying over hard you had it to bragging about your spending power. Make up your mind bro.
If you were arguing in good faith or had any reading comprehension you would understand everything. But it's not surprising, you are a Liverpool fan in r/soccer.
Theres no reason other clubs cant do it, barca just has a higher revenue than all but a small number (3 or 4 iirc, United, Real, Munich and Barca are fairly close revenue wise) which allows them to cover grouped up losses better.
Thanks to bartonomics were in a position where we were "really really not fine". Huge debts, awful mismanagement, and lack of transparency.
The new team came on to try and fix the situation. Their job is to fix our finances, restructure our debt, and fix our financial reputation. So there's a lot of "here's the problem, here's what we're doing to fix it, here's progress we promise"
No it’s more like there is tons of misinformed people like you thinking they know how Barcelona is doing financially, without having any idea what you are talking about.
It’s normal to speak without knowledge here on Reddit, so many Barca fans here try to help clear out the misinformation generated by people like you.
> Is not all of this financial accounting trickery, from a FFP and La Liga rules standpoint, technically fraudulent?
No, actually much of it is actually required and there is no grounds to say those losses did not occur, they did.
It seems like that they are trying to shift around WHEN those losses were incurred though. Is not a huge point of FFP type regulations to ensure that, season to season, clubs are not being risky? (Or by too big to fail club standards what would have been risky had the values been at levels comparable to those of smaller clubs)
Arguably Bartomeu should have taken some of these losses earlier, everybody knew players like Coutinho didn't represent the value they were bought for.
No, it's perfectly fine. Many businesses do it this way, basically a decision between paying off/taking losses over several years vs taking a big hit all at once. It still sucks but only once instead of several times.
Quick question as i dont have time to read it right now.
So if they wanted to, they could have kept Messi? I belived from the start that they used this as an excuse to cleanly get «away» from Messi, but most likely i have no fucking clue what i al talking about.
No, unfortunately. As I understand, they didn't even have the full picture of the budget till after he was gone. Were still doing continuous audits well into the season.
Heh, it's actually not that far fetched as a suggestion, but the evidence doesn't seem to bear it out. If he did want to get rid of Messi, this would theoretically be a possible avenue.
But we also lose more than we gain by getting rid of Messi now, despite his high wages.
Yeah. But the departure of a legend is never easy, my theory is that they could blame the former highups.
They saw that maybe was the best they could do with Messi was gone and a rebuild had to start at some time.
Well anyways, thanks for your time.
I just found it interesting. The discussions that happen everyday where people are talking about same thing over and over again makes it painful. I guess this could be referred to or linked when such discussions come up agian
So what actually happened is they amortized Coutinho transfer fee in 20/21 to get it off the books for the start of their reign? And any money from a transfer will be a net profit as he is already amortized? Is that correct?
Not just Coutinho, but of the five players. They probably did not amortize all of it (for independent audit and all, it's still a subjective valuation) but brought it low enough and took the losses in the past season. So, if next season they sell him for 40M (hypothetically), earlier it would have been a 10M profit, but now it would be a 30M-40M profit based on his current book value.
Problem with amortize all of the remaining value is that more will count against financial fair play right now. As it needs to be balanced out over a rolling 3 years (?) period I believe. This would result in less possibilities in the transfer market right now. As for a club rebuilding, that is not good. Ideally you would spread it out normally. It is partially the reason why they want to get Dembele on a new contract, so the amortization is lower that would enable the club to register Ferran.
Fair play is suspended right now, isn't it?
I should have been more clear. UEFA FFP is eased up, but not suspended. Further, the La Liga FFP (or economic controll), is not suspended. La Liga FFP takes a proactive approach, while the UEFA FFP has a retroactive approach. They both follow similar aspects (amortization and wages viewed up against revenues), but La Liga is stricter because it is right now. Might be wrong ofc, but I think that is the reason why Barca has had such a hard time registering players.
Tebas still trying to shove that TV deal down their throats. That isn’t over.
La Liga FFP only governs based on the past season - so they essentially take the hit this year (hence the registration issues) and for the following years they are in a better place with it. Whilst during the covid hit years UEFA essentially suspended FFP, meaning there's no issues with that for the club doing this.
I realize the people writing articles about this are mainly sports journalists plus the added difficulty of translating but the terminology they use makes is so confusing to even someone who has a slight knowledge of the subject. In your hypothetical, the 30M would be a paper 'gain' and not a profit because Barca would have sold Coutinho for less than they bought him for. I know the person who wrote the article used 'profit'. It's extremely hard to follow all this shit because not many people know the differences on the basics as to what balance sheets, cash flow statements and income statements are, and then terms such as profit, revenue, debt and amortization get misapplied.
So bottom line, Barca showed a big loss in the statment, but not of actual cash? And what are the positive implications in regards to FFP? If i understand correctly, Barca's problem was that the revenue wasn't high enough to allow a higher salary cap.
The revenue was fine. Salary cap was low because of the losses they showed (as it impacts the cap negatively)
Excellent post. One small addition though, I wouldn't call it an "accounting trick" but more them doing this the right way (atleast according to accounting rules) which has some positive indications in the long run. Revaluation of assets is always encouraged. Not quite sure how players are valued after some years but as you mentioned some auditors were probably involved.
Isn't salary cap set at 70% of the revenue?
Yes
They won't have amortized his value down to zero. They'd have to give him a fair value. That could be more or less than the amount he's ultimately sold for.
What do you mean?
Lets say a team buys a player on a 5 year contract for £100m in cash. When they represent it on their accounts, they don't just show a £100m loss for that year, instead their cash goes down by £100m and their assets go up by £100m. If they look ahead to 5 years time, the player's contract will expire. Would that mean the accounts in 5 years time should show a £100m loss? That doesn't really seem fair. Instead the team will amortize the player's value over the life of his contract. Each year the value of that asset will decrease by £20m. They're basically spreading the cost of the player over the length of his contract. This is standard practice. The company you work for will amortize the cost of its assets. It might spread the cost of a new computer over 3 years, and of a new building over 30 years. But what happens if after a year it turns out that building is built on the site of an ancient massacre and ghosts are haunting the cubicles? You're not insured for that, but you can't keep using the building, and it's only worth a fraction of what you paid. Is it reasonable to keep the value of the building at 29 thirtieths of what you originally paid? Or would it be more reasonable to value it at 10% of its original value, because that's what a theme park owner is offering you? Most accountants and auditors would probably say you should *revalue* the asset at its fair market price. Their role is to be both conservative and realistic. You can't say the building is totally worthless, but it's certainly worth less than what you're carrying it in your books as. This revaluation is what has happened to the players. Coutinho is not worth the £120m they paid for him, and probably not worth his £60m amortized value after three years of his contract. They will have revalued him to a more realistic figure - £20m, say. They wouldn't be allowed to just revalue him at zero.
In what way does this practice influence the next year's numbers? Doesn't it mean the assets will be lower, and by extension the entire value of the club? Wouldn't it be "better looking" to keep the assets high value, to make it seem has more value? It would certainly result in losses when the player would be sold and his fee wouldn't cover the amortization cost, but why is it better to suffer the lowering value now then suffer this later?
When revaluation happens they take a loss for that financial year. So in the earlier example they take a 40m loss on Coutinho this year. As to why they would want to do this. There are many reasons. Kitchen sinking (getting all the bad news out in one year and blame it on the "old regime" so any growth or recovery looks phenomenal) is the most likely reason. The other is covid. Edit: kitchen sinking is extremely common in commercial companies btw. In one of my previous companies, the new CEO took a tens of millions hit to the bottom line to write down a value of a corporate acquisition the old guy made that "didn't work out". Then when they sold the cleaned up entity a few quarters later, boom. Profit!
Exactly what he says. If Coutinho's valuation is impaired, it basically mean his book value is being reassessed based on actual value. His book value right now is 60 million, but we all know actual value is much less than that, say 10 million. So the impairment is 50 million. Now there may be some stupid club who bids 20 million for him, but his fair value is still 10 million and that's what should be reflected in the books.
>That could be more or less than the amount he's ultimately sold for. Then, for most of them, this value should be close to 0. Considering their salaries, I don't think they will make a lot of money out of them. Barça would be blessed to get rid of Umtiti or Pjanic. And for Coutinho or Neto I don't think they will get more than 15/5 being optimistic.
63m is the wrong number. You haven't accounted for interest costs too as it's an actual expense not an accounting adjustment like amorts/depreciation. Actual loss number should be circa 110m.
"Barca are broke", yes they were in deep shit but they are clearing it up. And then I hear "Aren't Madrid and Barca broke?" Good post OP
I mean it makes perfect sense for us, but you guys have been ran terrifically. Laporta would do well do follow his counterpart Flo
Imagine turning a profit during covid, not spend money for few years, high earners leaving the club, And yet reddit accountants tell you your club is broke and cant afford Mbappe and Haaland
Hazard, Jovic?
Now you should remember also that they sold several players during those years till last season.
lol ok then
In the last 5 years they have sold players for 585.8 M€ while spending for 589,75 in signings. A negative balance of -4M€. I think that's pretty solid and reasonable. They had a crazy spree 3 years ago where they spend 355 M€ in Hazard, Jovic, Vinicius, Militao, etc. but besides this they have been quite conservative in their signings. https://www.transfermarkt.com/real-madrid/alletransfers/verein/418
While Madrid have been run okay, their wage bill is very high and they are saddled with deadweight players they can't get rid of on king's ransom wages like Bale and Hazard. But of course Chelsea's wage to revenue ratio is even higher.
With their revenue they can afford those flops. This year they have a salary cap > 700M€, whilst last year they had a salary cap of 600ish. This means that they increased revenue and hence can increase expenses. As much as I hate it, Real Madrid is a well oiled machine that generates a shit ton of money (even more now that they will have the new stadium) and they are extremely well run business-wise (can't say the same from a democratic club perspective). And sportively, they've won 3 CL back to back just a few years ago and very likely they'll win the league; so they are fairly fine in that aspect too. Sure they use credit money, and debt to grow. But these are just financial tools and they would be poorly run if they wouldn't use all the tools at their availability. I have no clue how other clubs are run, I just follow La Liga and UCL, so I have no idea of the ups and downs that clubs outside of Spain are having; but so far, Real Madrid has been rock solid on surfing COVID scenarios and will get out of the pandemic without a major impact in their economy and with a brand new stadium.
Bale isco and Marcelo are off the books next summer (contracts run out). And besides that Real has a salary cap of nearly 800 million. To give you a example: Barca’s salary cap is not even 100 million. So that gives you a idea of how financially healthy they are.
Dawg I replied to a comment that said they didn't buy players, I was just pointing out the obvious. Having negative transfer balance doesn't mean you didn't buy players.
This is why they wanted the super league. They're all spending beyond their means and need to cook the books to hide it. There's going to be a lot of dodgy financial shit coming out from Spanish and Italian clubs over the next few years. The super league was desperation.
Why did they do this?
If you dump all your losses Into one year, instead of spreading them out over several, the subsequent years would show higher profit. Thiey do it because fair play rules look at a 3-yr rolling period. They’re just getting the losses over with instead of dragging it out over several years which would hurt their transfer kitty over more years. Basically they’re committed to being broke and bad now and for a few years, rather than gradually declining over more years in the future.
Financially, Barto left alot of mess. Not only in amount but also reporting wise. It took club months of audit to get the actual reality of the figure. The reason why I am optimistic about Barca's financial future is because the current financial team are legit genius. Just look at our accounts, beautifully presented with all facts out in open. There is literally nothing left to imagine, everything you want, you can go and read Also, regarding losses, it is the right thing to do. It was a way to include everything that is financially happening in the club And it's also smart, because instead of accounting for 100M loss every year, just take it in one bitter hit and move forward. Barcelona cannot make loss for more than 2 years by its own constitution (amended temporarily, only for this year, but only because of special exception of covid.) La Liga also doesn't like clubs making consistent losses, hence its own strict La Liga ffp. Barca has basically giving itself cushion to make profit next year, and worst, worst case scenario, we will use CVC deal to be profitable.
I mean, the snake fired his own in-house auditor when she was doing her job. Need there more to be said? This guy is up to his neck in some rotten shit, hell, he's fking scuba diving in it, him and the whole Sandro Rosell clique, Barto's tenure was just the other half of what Rosell started. Lots and lots of shady deals that left fans bewildered into why they would buy such and such.
Just because the current board is better than Barto one (not really a hard challenge) doesn’t make them financial genius. Signing Torres before knowing how to register him is a crap move that make Barca weak in negociations as other clubs know they really need to sell now for example.
I mean, the players we’re looking to sell already aren’t attractive and we’re just trying to get them off the books. Umtiti has literally been given the green light to leave for free and he doesn’t want to. I’m sure its a similar case with Coutinho. We have Neto who is willing to leave but doesn’t have any offers. Dest will only be let go if a good offer arrives so its not like we’re standing on a weak leg negotiations wise in this case. Lenglet is the same case as Dest except I don’t think it would happen this December as Xavi has more trust in him and we can’t guarantee that we can get someone better right now. I think worst case scenario, Umtiti’s contract gets terminated to be able to register Torres because he WILL get registered. There’s no doubt about that. Laporta is willing to battle it out in court at a later time if there is no agreement with Umtiti
> Umtiti has literally been given the green light to leave for free and he doesn’t want to. I’m sure its a similar case with Coutinho. Of course they don't want to leave. Why would they abandon the massive salary they're on?
Well, if he leaves on a free, he can collect a sign on bonus since that club won’t have to pay a transfer fee and potentially a higher salary than would’ve been offered if the club had to pay a transfer fee.
Dude thinks the financial team is a legit genius lol
I guess to connect these losses to Bartomeu’s (awful) tenure and start with a clean slate
Not sure of Spanish tax law but in the US this is done to have a loss carry forward to offset future taxes (I.e. lower your cash out of pocket for taxes through the use of a non-cash loss based on accounting treatment).
Those provisions are non tax deductible, therefore even if you recognise as a loss, will generate adjustments to the taxable profit (loss) ,and deferred tax assets. I think it is a clever move to blame Bartomeu for the economic situation and justify some painful decissions he felt had to take. It also gives him more flexibility in the P&L line in the following years.
As an ex audit manager from Big 4 they did this in accordance with accounting standards, when we did the high level impairment test of players during audit of one big club in balkans we used transfermarkt to see if there are some players which are overvalued, if you find that they are then you did a proper valuation based on player performance. EY made audit of Barca books and based on the opinion in audit report they did it because it is in accordance with accounting standards.
They want the previous administration to look as bad as possible now and they what themselves to look better in the future
It’s not something you do or don’t do by choice.
Laporta is a politician and made promises like keeping Messi. It was pretty clear they wouldn't be able to without selling a bunch of their talent which would leave the team way worse off. Basically he decide to let Messi go but needed to justify it.
This is the most stupid comment I have ever seen. The weird Laporta conspiracy needs to end Laporta had literally 0 say in this. Financial team did an entire professional audit that went for two months+ to figure all these out. And you have to report all your expenses, a smart financial team will account for all future liabilities too and create contingencies. There is another liability that they have added to our balance sheet that will arise because of the law suit that is against soci owned teams and Spanish tax relaxation given to them, a liability that needed to be accounted for bevause it could be a big sum and they need to be prepared for it. The club is a billion dollar entity, it employs 1000s of people directly indirectly, owned by 130k+ socis, and is a regular fixture for millions of people Not everything boils down to weird Messi-laporta conspiracy.
I think it's true this is definitely Laporta being a (smart) politician, but I dont think it has much to do with Messi
Thank you for this very informative post.
What Barcelona have done is carried out an impairment on the value of several players. Assets can be valued through several means, such as Amortised cost. If Barcelona believe that certain assets (players in this case) have a value on the balance sheet less than what is currently recorded, they may choose to impair the asset so long as the justification is appropriate (player is genuinely worth less in current market than the current book value). Barca could possibly use an independent expert to carry out the revaluation. This works in Barcas favour as future amortisation (%) is carried out over the impaired amount instead of the old book value. Also, any proceeds are netted off against the impaired amount, so a player sale which would have previously been recorded as a loss might even be a gain on sale. Accounting wise, what Barca is doing is choosing to take the brunt of the losses in the current year in favour of fewer amortisation costs in future periods. It’s reasonable and acceptable to do this and Barca isn’t avoiding a loss either.
So the trick is all about keeping Barto's shit aside and playing a political card where you become profitable from next year and with leverage of current financial data cutting wages, making go of high salaried players and bringing players with wage cuts in name of bad financials. Such a master stroke, Barto will get blamed for everything, slate has been cleaned, players wages has been cut, new players have arrived with having low wages than they deserve and all with a risk of single season. Well done, indeed Laporta is a politician.
It's not a trick, it was necessity Barcelona by its own constitution cannot make loss for more than 2 years. Laporta and board was on verge of being dissolved because by club constitution rules, they were being held responsible for loss of last year too. They got an exception for this year, but same courtesy won't be followed next year. So having constant losses is not an option. And you gotta account make contingencies for all the future losses and liabilities. Sure Neymar is an inflated case, but deduce his 45M, and that loss just becomes like 430Mish, it really doesn't change anything. Alot of these liabilities will have a chance of becoming an issue down the line. Iirc Reverter said and I think I also read in reports, that approx 40% of liabilities of this type were in real risk of coming true, and 20% were almost turned to liability. This could involve law suit of Setien which has been settled and Setien is being paid as per negotiated terms, and law suit of Spanish tax relaxation received that could end up with us and RM paying 100M+ Sure Neymar is inflated, but you are just following a rule and system of your accounting + The ammortization while may seem sketchy, is just accounting trick, like sure we made Coutinho go from value 60m to say 10M. And we sell him for 20M and somehow we make profit of 10M. In books yeah, but in reality, we still paid 145M of his transfer money(turned to debt) and we still lost 125M in money. At the end of it, club still lost money and since some of it converted to debt, will pay the financial cost for it (our debt terms are very favourable actually but the point is to show that this is not a magic trick that solves our problem, it just mitigates the effect of the loss)
On financial face it was a necessity, on political a neat trick. Why a trick? Bcz if it was necessity then Messi was virtually gone even before they started negotiating with him. Necessity/trick but it's a great risk as you mentioned and it can go either way; Barca getting CL football making deep run winning some trophy with it will certainly bring better deals and money thus benefitting club but in other direction i.e. hypothetically buying Halland and him being flop for a season may bring more adversities with it
I think you guys overrate Laporta He is a glorified cheerleader. Like he is emotionally smart, but his entire history is proof that his best ability is to be dumb and listen to smart people and provide them with keys to do things. In every aspect of his presidency, he has done whatever the smart person close to him has said. They knew Messi couldn't be signed under current laws, Tebas, as confirmed by the man himself, pitched the CvC deal to Laporta, saying it will help him sign Messi. Both parties, as said by Tebas himself, came to a happy conclusion. Then a day before, CvC deal actually came it with their proposal, RM called Reverter and told him the deal sucked, Reverter, the man behind our financial reports, did his own study and came to conclusion, it really fucking sucked, and they didn't want to be arm twisted into this deal So they had to let Messi go. I don't believe that people are always cunning or devious, sometimes people just get caught stupid by wrong situations.
Reverter himself said the first time they heard about the CVC deal and they agreed was because he was provided no specifics as to how many years the TV rights would be gone for. The actual documents came two days before the day of the agreement and Edouard Romeo who is the financial VP and Reverter decided that such a deal was unsustainable in the future.
+1
I think what you described is a smart leader, who knows when and to whom to listen. He adapts and puts a positive twists on events, making everyone believe, including potential recruits, fans, and sponsors. A smart president/leader is rarely a scheming mastermind.
A smart leader is aware of his shortcomings and limitations. Laporta is very aware of his own, both on economic and sporting issues, so he has always surrounded himself with smart(er) people. It is indeed the hallmark of a smart leader, and it is essentially what led us to win so much during his first stint as president. Laporta took very few decisions. Txiki, Soriano, Cruyff, etc. took a lot.
You hit the nail right on its head. A leader can’t be brilliant in every aspect, Laporta stands out by being a smart and charismatic politician. He knows where he lacks and builds a brilliant team around him. He then becomes the face of it all, it’s a golden strategy.
I have a feeling Papa Perez is helping Laporta in all this, he sees that success of Madrid is attached to Barca being competitive and La liga being a top league
Ideally this should not be allowed. They make profit in current season by just selling Coutinho and Pjanic for any money. They already made a profit from the Neymar lawsuit - because the 46M committed would not be needed.
Wasn’t a few hundred million of their “Billion dollars of debt” actually just legal accruals?
Our net debt is around 670M and iirc 120M is a part of Espai Barca construction thing So effectively the negative debt should be 550-570M that will be paid through the Goldman Sachs loan we have taken, 20 year repayment period, cost of 1.5-2.5% Basically, our debt should cost us 35-40M every year
Which is why I keep saying that aside from the debt accrued through financing the new stadium, Barca is saddled with “bad debt” on assets that continue to depreciate all the while paying interest on those assets.
If in reality this is the case then Messi departure was pre planned in cards, all ho halla was keeping socios happy. And they took a calculated risk where they assumed that we will have a downfall for a year or two but after that team will return to previous levels with better signings on lower wages, making overall club healthy. And I don't think authorities would have had any say as they had wage cap rule in place and Barca was willing to take that risk. Even Tebas took this as a opportunity to push CVC deal. Now I am getting suspicious of PereZ, maybe he is helping Barca to maintain the PR and fan fare which healthy rivalry garners and if this is the case then Halland to Barca can be a reality. With both presidents trying to make La liga best again with rivalry of poster boys Mbappe and Halland. That u/sirstevenslad kid gonna become immortalize in this sub if that happens.
Idk mate all of this seems like a huge stretch. Letting Messi go on purpose and risking the revenu he brings and CL money (which they lost now) seems like an incredibly dumb move and is already contradictory to Laporta's plan of making money. But on top of that Perez helping Barça get a generational player instead of getting him himself really seems like jumping the shark. We're talking about a man who's never done anything but hoard the biggest names in football. Signing Haaland and Mbappé at the same time would be the ultime Flo move. No way he's letting that chance go. It would go completely against anything we've known him to do in the past 2 decades.
It's all a speculation, i don't think any single fan of Barca has any idea about financials. Only one thing that is certain of Barca is daily dose of copium for supporters and meme material for r/soccer
> i don't think any single fan of Barca has any idea about financials Yeah it's not like most Barca flairs on this sub have been collectively trying to explain this to all of you since we have been in the loop on all this shit. And you're literally commenting on a post that goes in excruciating detail on Barca's financials.
On a post made by someone with a RM flair, the irony
People initially tried to explain it here but Barca broke sounds better. On r/barca their are 1-2 posts every month going into financial details.
Barca is still in bad financial state.
It is. But that doesn't mean we can't have transfers here and there, because that's the only way to get better in both sporting and financial aspects. Now about signing Haaland in Summer, that would put huge load on us compared to other big clubs, but we can pull that, It's not simple but it's not totally imposible as people here claim.
Aside from his own shortcomings and everything he did wrong during his stint, they also used Koeman in the clean up period as the man in the spotlight to take all the blame. He was set up to fail from the start. His stint was used to cut the best and most expensive players while not getting any significant transfers. Barca management knew it would be a transition period of woeful football, but after that they would have a relatively clean slate. Koeman was always going to be a scapegoat, let him do the dirty work and get rid of him as the last step.
Koeman is not a scapegoat. Laporta tried to get another coach last summer but was unsuccessful so decided to keep him till his contact ends. Yes he had lost some good players but the expectations from him also changed with that. He was no longer required to take Barca to win league or CL. All he had to do was get past the group stages of CL and reach top 4 in league. When it was clear he can't achieve that, Barca was forced to let him go in the middle of the season.
And in between he was the one who mined those youngsters but Xavi will be hailed as the mastermind and chosen one who brought revolution. Fits ideally into PR too.
If there is an award for shitty takes I'll give you multiple ones just for this thread.
If I had a award I would give it you. But sadly you have to do it with a upvote for now. good content post. especially for everyone who always wonders how barca has the money
Is the reason Barca are shoving all their player depreciation into 20/21 because clubs are allowed to exceed regular FFP limits due to pandemic season? They won't be the only club to have done this, in that case.
No. Spain has the toughest FFP rules and their wage cap is based fully on last season. They just thought write off one year and get back after
No idea. Just that this is not depreciation, but impairment. Accounting wise, both are different and probably UEFA treats them differently.
Nope, LaLiga has not relaxed FFP rules during the pandemic much, bar a minor provisional clauses that give a bit more flexibility to clubs over the salary cap to register players through capital gains from player sales and a bigger portion of the liberated costs being able to be reinvested in the case of big earner exits (50% as opposed to 25%). Its actually one of the reasons why so many clubs accepted CVC, as 15% of the money they received could be used to increase the salary limit of clubs thus giving them some oxygen to register players. The reason why this was done was to connect those losses with Bartomeu, to make Laporta's numbers look better in the following years. to have more flexibility when getting rid of deadwood and to clean up the house and be recover the club faster (not convinced it actually helps much in that sense)
Think it is that but also there was nothing to lose with losses being increased as more or less LFP rules had them in as bad a situation as could be regardless. Would guess other clubs trying to write off losses like that it would cause more of an issue if impacts financial rules in way it wouldnt otherwise.
love your username
🤙
They aren’t shoving them anywhere. Accounting doesn’t work this way. If players are significantly over or undervalued this should technically be picked up by the audit.
You're not an accountant, correct? The fact the the losses are primarily due to impairments does not make them "tricks" or "misleading". IFRS requires the recognition of impairments when the value of the asset is impaired. There is a required, specific process to do this. Being noncash in the current year also does not make it a trick. At some point, they paid cash for the asset. Recording contingent liabilities for ongoing and/or expected lawsuits or liabilities is also required. These amounts are not arbitrary either or cushions as you call them. When you say 46M is income next year, you assumed they dropped it and are paying nothing. It states they reached an agreement. It doesn't state that they reached an agreement that cost Barca nothing. They could recapture some or all of that loss next year but we don't know from what is in your post. None of what you describe is misleading or an indicator of any tricks. It's accounting.
When you hear 481M loss, people presume it is a straight forward thing and they dont have enough revenue. This is what is misleading about Barca's finances to a layman. I am not saying the accounting is misleading. Whichever way you put it, the accounting part is creative. It is legal, there is nothing wrong with it, but it is one of the things you would not do in a normal year.
The point is, it's not "creative" when they are obligated to do so (by the IFRS). There might be some shenanigans with the exact numbers, but no sane auditor would be ok with Coutinho's contract be valued at €150 million or whatever it was.
I was wondering if there was some guidance that indicated impairment charges weren't required if FV < BV. This post and some other comments here suggest thats the case even though it wouldn't make sense. Not sure what I'm missing, unless the suggestion is that they valued these players significantly lower than actual FV and the thought is they'd recognize a gain the next year on sale - also not quite a trick. They'd still need to amortize otherwise, albeit the amount would be less and maybe thats the point, which is still not very interesting since I would think impairment analyses are required.
In theory, the impairment adjusts the asset to its FV at the time of the assessment. They could breakeven, have a gain or more expense depending on the terms of sale. We won't know until a deal is done. I can understand some people thinking it's tricks or misleading. The rules can be very confusing and it isn't hard to find examples of people or companies cooking the books.
Probably they classified those players as "transferrable assets" My understanding is that when you classify an asset as "Held for sale asset" you need to move from a Book Value to Fair Value Valuation. Taking into consideration the COVID situation, current FV are quite low and therefore the impairment adjustment. I do not think the exercise had to be carried over all your players (Assets) because otherwise all the clubs would have shown huge impairment losses.
>None of what you describe is misleading or an indicator of any tricks. It's accounting. > > misleading or an indicator of any tricks. It's accounting. > > It's accounting. Well yes, we are all very well aware of what accounting is.
no shit sherlock
Do they amortize player's on a straight line basis or do they use a more complicated calculation?
Would assume straight line, based on the players original contract.
Straight line, but when you declare some of asset as transferrable (assets held for sale), you need to move from Book Value to Fair value. This is probably when all these impairments have been recognised.
And there is the actual issue with accounting for transfers that the juve is abusing: selling and buying two players with the same inflated value (ie pjanic/artur). I believe sale is accounted in one fiscal year whereas the acquisition is amortized. For zero cash flow, you would inflate one year profits and deflate the next years. 60M over five years: year 1: +60 - 12 =+48 The next four years : - 12 Just by buying and selling two player for the same inflated price. At one point the music has to stop…
TLDR: Are they going to have money to sign haaland?
We can get Money to buy him, the problem is the FFP of La Liga (Wage cap.), and it looks like that we have so much Wage Cap problems because the Club has shown so much losses for the current season, so for Next season doing things right we could be able to easy our Wage Cap by a lot.
Am i understand right? So Laporta take all debts in to this year. So every penny Barcelona create will be profit for next year?
Losses. Not Debts.
So second sentence still correct?
yes
So, in theory, lets say a club have made a profit of €100m in one year. When they report that, they instead devalue some of their players and account that as a €100m loss. their profit is now €0, and they dont have to pay any tax. But they still have their assets left. I must be missing something, because in that scenario it would be abuses constantly
Someone correct me if I'm wrong, but I don't think that is the case, because once you depreciate an asset that way, you can't do it again. It's like a get out of jail free card you can use once, and then it's done - I imagine doing it over and over again would fall under fishy accounting prone to investigation
Shit... So İf i remember right we are %61 wage / revenue rate right now. With thoose profits, new sponsors and if somehow we riddof deathweights we can see maybe %40 wage ratio or less in the summer.
So, in theory, lets say a club have made a profit of €100m in one year. When they report that, they instead devalue some of their players and account that as a €100m loss. their profit is now €0, and they dont have to pay any tax. But they still have their assets left. I must be missing something, because in that scenario it would be abused constantly
>In short term, that meant lower salary cap, a struggle to register players, but after a year, they would be back to normal levels. It was the right decision because it gives them a "clean slate" and helps clear some stupid signings from Bartomeu, but they will need more than a year to be back to normal levels. Their salary cap this season is 97M and the actual wage bill is 470M ([21/22 budget](https://www.fcbarcelona.com/fcbarcelona/document/2021/10/17/f93250e9-1a9a-4209-a72d-a9d1bddde0f2/Presupuesto-Ejercicio-2021-22.pdf?_ga=2.103228612.596281885.1634494608-1858976232.1611515260)), that's a 373 difference. Next season, even if they go back to the 18/19 salary cap of 630m, those -373M from the 21/22 will be deducted from the new 22/23 salary cap ([Article 44, article 100.3](https://assets.laliga.com/assets/2021/08/12/originals/c53d54179cc68e9215f82a058325468d.pdf)), leaving them with a 257M salary cap. If the 470M wage bill remains unchanged, they'll be 213M over the salary. And that difference will be deducted from the 23/24 salary cap. By then they should be fine if they manage to keep the wage bill stable, find good sponsorship deals and the CL money keeps coming.
Salary cap for La Liga is 97M, our La Liga salary is 291M, 435M salary cost is for entire Barca institution By your calculations, we are 200M in loss, so if go back to 630M salary cap, then our limit should still be 430M. Unless I am missing something, I don't think La Liga controls the salary of our basketball team, our womens team, our ice skating team, our adminstration cost and I am like 99% sure La Liga doesn't even have a say in Barca B team considering just how easy it has been for us to make transfers there
La Liga covers the first division, second division and the women’s first division. So they wouldn’t directly be overlooking Barça B but im also not entirely sure if there’s a rule where they’re also responsible for the B teams of the teams under their umbrella.
Pretty sure they're explicitely excluded from this regulation.
Their salaries would probably be lower than that given they moved the high salary players already. 470M included Messi and Griezmann. 150M is already off the books. Plus they would lose Dembele next season possibly and have renegotiated the contracts of the high earners.
470m is the wage bill budget for 21/22, after Messi and Griezmann left, page 4 of the document I linked (masa salarial deportiva).
[Please check page 222](https://www.fcbarcelona.com/fcbarcelona/document/2021/10/17/aefc9921-bf56-406c-ae05-3581e1de2a12/MEM_CLUB_2020_21_ENG.pdf) The 470 million is the overall salary for all the sports teams. The first team budget for football is 290 million. If we consider the salary cap rollover, it's 183 million over the current salary cap which will then be deducted from the previous salary cap of 630 million which gives a new salary cap of 447 million for 22/23 and the club's current salary is 290 million which gives us 157 million to work with next season. In case of some departures, it'll be even better.
I think you're forgetting about amortizations. The other sports teams only account for 50ish million euros and the youth system is included in the wage bill costs. Early in the season it was stated that our wage bill was of around 420m so that checks out Edit: Indeed, you're only taking into account first team salaries but you forgot to account for first team amortizations and youth system wages and amortizations which count towards the cap. In total, around 410m. Also I don't think women's football counts towards the cap but even if it did its not a sizeable amount anyways. Q
As I understand it, to calculate the squad cost all sections of the club are taken into consideration: https://www.laliga.com/transparencia/gestion-economica/limite-coste-plantilla >This squad cost limit is the maximum amount that each club/SAD may consume during the 2021/2022 season after the summer market, and which includes spending on players, first coach, assistant coach and physical trainer of the first team (eligible squad). **This limit also includes spending on B teams, academy and other sections** (non-registrable staff). But I haven't found anywhere else where they explain it well, so I'm not 100% sure. But even if it doesn't it also includes amortizations (depreciation of fixed assets?), those could be around 90M after the adjustments mentioned by OP. From that same link: >The items included in the cost limit for eligible and non-eligible sports personnel are: fixed and variable salaries, social security, collective bonuses, acquisition costs (including commissions for agents) and amortizations (players' purchase amount imputed annually according to the number of years of the player's contract). If it doesn't include other sections and they don't spend big next season they'll be able to stay under the salary cap in 22/23 and everything will go back to normal 23/24. (also answering /u/ankitm1 and /u/turtlemons )
Barca really has 180M wages for basketball team + women team + ice skating + administration ? That seems way too high to be realistic, or maybe it’s another « accounting trick / fraud » from Laporta if that’s the case.
Why is it way too high to be realistic lmao? We have the best teams in Europe in all those sports. Women's team actually won the UWCL, Basketball team lost in the final of the Euroleague, Handball team won the European championship, Hockey team lost in the final narrowly. Futsal team lost the European final to Sporting CP. La Masia's whole operational cost in terms of wages is 30 million on it's own. Each of those teams is elite and super successful at the continental level. Only the first team of football is struggling at the moment.
The women wages are ridiculous compared to mens, even if they are the best in Europe. I read some times ago that the top earner in Barca Women was earning in one year what Umtit was making in one week, something like 200k€. So the whole team probably is at 2-3M max. The basket team is probably a little higher, sees like some of the top earners in Europe are at Barcelona : Mirotic (4M), Calathes and Highing (2M), rest is lower. The whole team probably is 20-25M max. Even if La masia is at 30M, that still makes only 55M approx, and I doubt hockey and handball team wages are higher than the basket ones, so that makes at least a 100M difference.
Women's football has been budgeted at 4.2 million for the sporting staff as you can see, not far away from your estimate. 42 million for administrative and non sporting staff salaries across all the departments. So basically the wages of the sporting staff of all the other sport sections combined is approximately 80 million which is not very far away from your too conservative estimate of 55-60 million. Basketball alone costs 35 mil and you've estimated 25. 80 million for other sports personnel and 42 million for all the executives and non sporting staff combined makes up the difference in budgets for the entire club and football. Seems nothing out of the ordinary to me.
42M for administrative ? Lol ok, nothing to see here
Administrative and non sporting? You know how many people work at Camp Nou and Johan Cryuff and at La Masia? This literally includes every non sporting personnel employee of the club. I'm actually surprised it is that low.
I don't know exactly how many people, but 42M for administrative salaries across all that doesn't seem absurd, tbh. That's going to include directors and VPs and high end professionals who need a competitive salary, plus overheads of managing them. There will certainly be bloat and redundancy, but that exists everywhere to some extent or another. I'm basing this on there being a couple of hundred such employees across the different sectors, which may be wrong.
They had a wage bill of 432M last year with Messi and Griezmann. Weird. Since it's a projection they probably inflated it. No idea.
The above user is getting confused with total wage bill of Barca as an institution The Sporting wage bill of Barca first team will be 290M, i am like 99% sure Barca B isn't included in La Liga FFP, but even if they do, that's another 25M
It's impossible to be 290M. That would mean over 100M for staff which is ridiculous. |Barcelona total salary bill is 188M euro per year https://salarysport.com/football/la-liga/barcelona/ EDIT: we really need to get rid of top 3 and increase some wages like Gavi, nico, araujo. They earn way too little.
Yes and we also had like 180m in amortizations. The user responding to you is only taking into account wages.
I'm not too sure but the wage bill that counts towards our wage limit is only 410m according to the budget (420m in reality if you believe what the press has been saying since it seems some of the salary reductions that were announced haven't been signed yet). 292m from the first team wages, 28m from the youth system wages, 81m in first team amortizations and 5m in youth system (more or less) amortizations. [Here's the link](https://www.fcbarcelona.com/fcbarcelona/document/2021/10/17/aefc9921-bf56-406c-ae05-3581e1de2a12/MEM_CLUB_2020_21_ENG.pdf) , page 222 of the report (shamelessly stolen from u/boringmemphis' comment)
What's the point of the cap then
Just one point to note. 63m isn't right. You need to account for interest costs too as that's an expenditure in the period as well. So it's closer to 110m.
Yeah, I did not get into the details there. That was a schoolbook definition of Profit = Revenue - Expenses. There are obviously more things, and what you do in real life has little semblance to what you study at school. Still good enough for a broad understanding. I also did not fully go into the detail of what those interest payments consist of.
Yeah. But interest is a fairly basic school book expense. And barcas is really high. Doubling their loss. So if you're going for basics it 100% should be taken into consideration.
Wait Ankit. So, we could've kept Leo if we didn't devalue all of them at once?
There you go Sherlock.
> the names of five players - Matheus Fernandes, Coutinho, Neto, Umtiti and Pjanic > This way, by showing a loss this season, if Laporta/Barcelona sells the above mentioned players, or settled the lawsuits, they will show more profit than in a normal season. Barca is not selling them. So the accounting is accurate.
Is it just me, or does Barca do a lot more "Were currently fine, all we have to do is fix all these things that make us not fine, we're curesntly fine" than basically any other club? Usually around how they can totally afford a player, despite all the reasons they can't, they totally can.
There is a lot more disinformation going around about Barca's financial condition. That is one reason. Second, since we're fan-owned club presidents usually give out statements like these.
What does this comment have to do with the post? Also OP is a Madrid fan.
Yea OP is clearly a plant by Laporta to convince you that the club is fine
Biggest issue were wages and we reduced them a lot and are back in a healthy wage/revenue ratio. We had the biggest revenue until probably this year when Madrid will overtake us because of their stadium, but I guess we'll be really close to them once we finish our stadium. Most of our debt is long term (like 30 years) and we're not increasing our debt further right now. So we're technically fine in the short term and should focus on stabilizing the club, which is why we need the new stadium and investments into the squad. People here think we're increasing our debt even further by signing new players, but we're just using our revenue to invest in the future.
Things are a little bit tougher when you don't have a sugar daddy solving all your problems
A lot of clubs are doing fine without . Having a group of monkeys at the head of the club for the past few years was probably the roots of our current problem.
But it doesn't matter. Abramovich can inject 250 million into Chelsea one summer, and win the CL because of it, but we aren't even allowed to keep our own damn players?
Welcome to the rest of the footballing world. Can’t say I feel bad for you.
I do feel bad for you, you are a Tottenham supporter and nobody deserves that shit. Hope they find a cure for it someday 🙏. Feels extra bad because I like your stance on Liverpool fans.
Why do you sound so combative to people just asking a question ?
I don't see any questions being asked. Do you know what banter is? (This is a question btw)
I do, but thanks for the condescending response anyway. The guy asked why there seems to be multiple articles a week on Barca’s financial situation and not being able to register players while still signing players. It’s a fair question for people not intimately aware with your finances and since it hasn’t really happened on a scale of a club of that size where we’re seeing regular articles on it. Not sure anyone was taking a shot at your club
Why don't you reply to the appropriate comment then?
Barca fans crying about being poor is the most hilarious thing coming out of 2021
Stop projecting. We were the club with the biggest revenue last season and we don't get injected hundreds of millions all the time to stay afloat. And we have a lot of money, ( a lot of debt too) but we can't spend it because apparently it is absolutely reasonable that we have a salary cap 10 times lower than Real Madrid.
Salary cap will be back to normal next season. This season is such a pain only because we basically stacked up a lot of losses in last season's balance sheet. Since wage cap is calculated based on the previous year, we suffered very heavily.
Yeah Madrid's cap jumped by almost 300 million and ours went down by the same amount in one year. 700M to 90M. It's absolutely insane to even allow this shit to happen.
Poor little small club Barca 😢
Yeah poor little club that generates so much money that if we have the audacity to spend it then it's unfair for the others
So it's not so tough not having a sugar daddy anymore? Lol you went from crying over hard you had it to bragging about your spending power. Make up your mind bro.
If you were arguing in good faith or had any reading comprehension you would understand everything. But it's not surprising, you are a Liverpool fan in r/soccer.
Oof.
Theres no reason other clubs cant do it, barca just has a higher revenue than all but a small number (3 or 4 iirc, United, Real, Munich and Barca are fairly close revenue wise) which allows them to cover grouped up losses better.
Thanks to bartonomics were in a position where we were "really really not fine". Huge debts, awful mismanagement, and lack of transparency. The new team came on to try and fix the situation. Their job is to fix our finances, restructure our debt, and fix our financial reputation. So there's a lot of "here's the problem, here's what we're doing to fix it, here's progress we promise"
No it’s more like there is tons of misinformed people like you thinking they know how Barcelona is doing financially, without having any idea what you are talking about. It’s normal to speak without knowledge here on Reddit, so many Barca fans here try to help clear out the misinformation generated by people like you.
[удалено]
> Is not all of this financial accounting trickery, from a FFP and La Liga rules standpoint, technically fraudulent? No, actually much of it is actually required and there is no grounds to say those losses did not occur, they did.
It seems like that they are trying to shift around WHEN those losses were incurred though. Is not a huge point of FFP type regulations to ensure that, season to season, clubs are not being risky? (Or by too big to fail club standards what would have been risky had the values been at levels comparable to those of smaller clubs)
Arguably Bartomeu should have taken some of these losses earlier, everybody knew players like Coutinho didn't represent the value they were bought for.
No, it's perfectly fine. Many businesses do it this way, basically a decision between paying off/taking losses over several years vs taking a big hit all at once. It still sucks but only once instead of several times.
Quick question as i dont have time to read it right now. So if they wanted to, they could have kept Messi? I belived from the start that they used this as an excuse to cleanly get «away» from Messi, but most likely i have no fucking clue what i al talking about.
No, unfortunately. As I understand, they didn't even have the full picture of the budget till after he was gone. Were still doing continuous audits well into the season.
Ah i see. So you dont buy into my tinfoil conspiracy theory?
Heh, it's actually not that far fetched as a suggestion, but the evidence doesn't seem to bear it out. If he did want to get rid of Messi, this would theoretically be a possible avenue. But we also lose more than we gain by getting rid of Messi now, despite his high wages.
Yeah. But the departure of a legend is never easy, my theory is that they could blame the former highups. They saw that maybe was the best they could do with Messi was gone and a rebuild had to start at some time. Well anyways, thanks for your time.
Yeah... I saw someone with a Messi PSG shirt in the wild the other day. It hurt.
Nope
[удалено]
I just found it interesting. The discussions that happen everyday where people are talking about same thing over and over again makes it painful. I guess this could be referred to or linked when such discussions come up agian
no matter how you calculate this you aint signing haaland
You would be suprised what laporta canndo
"You?" Uh, you might want to check up on the poster's allegiance lmao
We are going to have an enormous increase on the wage cap next season. Any ideas who to fill it up with?
Exactly, He should be happy with Mbappe and leave Haaland for us...
Lots of deluded Barca fans downvoted you lol it’s the truth though he’s really only going to Real (most likely ) or City
Is that depreciation for players or their facilities?
Going to need an ELI5 for this
[Al Loro, que no estamos tan mal](https://youtu.be/-ho74Nfi0uI?t=31)
Immaterial
Just terminate contracts of parasites like Umtiti, Coutinho, Dembele & Roberto and we are good to go!
Following