| Always crashing in the same car – Column on 16:12 - Feb 21 with 9644 views | R_from_afar |
Really insightful analysis, many thanks for that 
I think this is a key section as in a nutshell, it says that if we drop into League 1 and splurge in order to get promoted, spending heavily will give us a FFP headache once back in the Championship. I knew nothing about this, it's a real eye opener for me.
"I know that some see relegation as an opportunity to rebuild without being encumbered by the Championship’s FFP regulations due to different criteria being employed by the EFL at that level. While this is true all the time a club stays out of the Championship, on promotion back to it the club returns to being assessed on a three-year rolling period which will include any seasons out of the Championship. The regulations make no exceptions for clubs promoted from League One, the loss thresholds relate to members of “The League” not specifically the Championship. There is no carte blanche to throw pots of money at our problems before returning stronger than before and nor should there be". |  |
| "Things had started becoming increasingly desperate at Loftus Road but QPR have been handed a massive lifeline and the place has absolutely erupted. it's carnage. It's bedlam. It's 1-1." |
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| Always crashing in the same car – Column on 17:26 - Feb 21 with 9237 views | loftupper |
| Always crashing in the same car – Column on 16:12 - Feb 21 by R_from_afar |
Really insightful analysis, many thanks for that
I think this is a key section as in a nutshell, it says that if we drop into League 1 and splurge in order to get promoted, spending heavily will give us a FFP headache once back in the Championship. I knew nothing about this, it's a real eye opener for me.
"I know that some see relegation as an opportunity to rebuild without being encumbered by the Championship’s FFP regulations due to different criteria being employed by the EFL at that level. While this is true all the time a club stays out of the Championship, on promotion back to it the club returns to being assessed on a three-year rolling period which will include any seasons out of the Championship. The regulations make no exceptions for clubs promoted from League One, the loss thresholds relate to members of “The League” not specifically the Championship. There is no carte blanche to throw pots of money at our problems before returning stronger than before and nor should there be". |
That was the big take away for me as well. Thanks Simon! Just a proper ray of sunshine!  |  | | |
| Always crashing in the same car – Column on 17:27 - Feb 21 with 9232 views | EastR |
Thanks Simon, some interesting takes in there on the numbers which ultimately gets us back to having to conjure up around £10m in this current year to stay compliant.
That can either come from – increase revenues, cutting costs, selling players, or a combination of those.
Core revenue (that’s excluding broadcasting) has been consistently in the £12-£14m range going back to 2015, excluding the COVID seasons. Not much potential there to make a dent.
Naming rights have clearly brought in some money this season, but we have no indication as to how much. If we were generous and said £2m we could bank that against the deficit.
We haven’t made any more sales so I think the Dieng and Dickie contribution is it, and I also think that’s the profit rather than the cash. Again, we’ll round it to £2m.
That leaves us with £6m to find in cutting costs, primarily the wage bill. That would be a 25% reduction on current levels and we’ve only achieved that level once since 2015/16. I’m not sure there is that excess between the outgoing, pay offs, the replacements, or even the vacancies.
Having said that it would account for the turnover on the non playing side we’ve seen including Hoos from CEO (paid) to Chair (presumably now retired and not paid), Ferdinand, Ramsey, medical staff etc
We’re either going to make it by the skin of our teeth or we’ve gambled we’re going to play our way into a position next season where we take a points hit. | |
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| Always crashing in the same car – Column on 17:37 - Feb 21 with 9178 views | cpgerber |
I just can’t believe we are the only ones worried. There must be a handful of others in our league in the same situation. |  | | |
| Always crashing in the same car – Column on 17:39 - Feb 21 with 9164 views | CroydonCaptJack |
Great stuff Simon |  | | |
| Always crashing in the same car – Column on 18:10 - Feb 21 with 8969 views | stainrods_elbow |
Great to have all this expert analysis, but there comes a point when you wonder what more a club like QPR can do to stay competitive, given that virtually all football clubs are massively in rolling debt (or 'leveraged' debt, as at Manure) anyway. It's supposed to be sport, not some kind of relentless fixation with accounting, but I suppose I'm just a misty-eyed maniac. [Post edited 21 Feb 18:10]
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| Always crashing in the same car – Column on 18:25 - Feb 21 with 8926 views | sprocket |
Many thanks. A great and sobering read.
How do we cut costs by 10.8m? I can see reduced wages both on player and staff accounting for maybe 50%? of that but no idea on the rest. I think there is a limit on ground sponsorship revenue too? Payroll is the big cost and always the first and most effective way to reduce losses. Hard to see how we can drop costs by that much given the player outs/in this year. As was mentioned perhaps the hope is we have enough point next year to absorb a points deduction but that is grim. [Post edited 21 Feb 18:37]
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| Always crashing in the same car – Column on 18:43 - Feb 21 with 8809 views | colinallcars |
I'm making my contribution by not claiming back the £8 the club got for the QPR+ Stoke match ! |  | | |
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| Always crashing in the same car – Column on 19:16 - Feb 21 with 8676 views | connell10 |
So if we have to make further cost cuts next season then surely even if we stay up this season, then next season we will be circling the drain again . |  |
| AND WHEN I DREAM , I DREAM ABOUT YOU AND WHEN I SCREAM I SCREAM ABOUT YOU!!!!! | | Poll: | best number 10 ever? |
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| Always crashing in the same car – Column on 19:23 - Feb 21 with 8619 views | Benny_the_Ball |
Thanks, as always, for the analysis, Simon. Very much appreciated. The headline appears to be that next season will be crunch time. Retaining championship status is the immediate concern. Beyond this, summer transfer activity will be key.
I must say I found it a little odd that last year's article excluded the £2.5m Covid-19 costs permitted by the FFP regulations for the 2021/22 season. As you say, it's inconceivable that the club didn’t claim it, so it should've been included before. Was this an oversight or was their some logic to its exclusion?
On another note, trying to translate company accounts into FFP looks like mission improbable given the complexity of accounting rules and the number of unknown variables. Many assumptions have to be made just to build a broad picture. With this in mind, are previous FFP accounts not available for public consumption? If not, is it possible to gauge disallowable numbers from historic company accounts? |  | | |
| Always crashing in the same car – Column on 19:30 - Feb 21 with 8587 views | GaryBannister86 |
Thanks for the analysis. I put my big brain in and tried my best to understand....so thanks.
If I get it right, we are in massive danger of falling foul of FFP next season, not this. So could there be a thought (if we stay up) that the owners may think we may as well go further over in order to ensure we get enough points to stay up? Or, dream on, get promoted?
Not saying that would be my plan, but the owners do have wild thoughts.... |  | | |
| Always crashing in the same car – Column on 20:14 - Feb 21 with 8387 views | SimonD |
These accounts are for last season (22/23). The crunch season is this one (23/24).
If we get through this one still in this division and without suffering a points deduction we will be in a better place. I do hope that they have learnt from this and don't act in the same way. | | | |
| Always crashing in the same car – Column on 20:22 - Feb 21 with 8315 views | stevec |
During the two seasons affected by Covid I notice our revenue dropped by £13m (6.5m a season) based on the average of the two seasons since.
No fault of our own but that will have disproportionately affected our FFP losses. Surely the EFL should be taking this in mitigation?
Relegation by points deduction is becoming rather tiresome. I’m surprised owners aren’t getting together and attempting to remove the EFL from the equation in some form or other. |  | | |
| Always crashing in the same car – Column on 20:34 - Feb 21 with 8245 views | SimonD |
| Always crashing in the same car – Column on 20:22 - Feb 21 by stevec |
During the two seasons affected by Covid I notice our revenue dropped by £13m (6.5m a season) based on the average of the two seasons since.
No fault of our own but that will have disproportionately affected our FFP losses. Surely the EFL should be taking this in mitigation?
Relegation by points deduction is becoming rather tiresome. I’m surprised owners aren’t getting together and attempting to remove the EFL from the equation in some form or other. |
Remember that we had 4 years of parachute payments after being relegated from the Premier League. These payments are included in the revenue figure. Allowances were made for a reduction in revenue and I have allowed what I believe is the minimum level of these. The calculations I've made are shown on one of the linked articles.
In theory, the owners could vote to end FFP if they wanted to. What I don't know is how EUFA would react to this as FFP is their (Michel Platini's) scheme. The majority of owners want FFP. | | | |
| Always crashing in the same car – Column on 21:37 - Feb 21 with 7963 views | PunteR |
| Always crashing in the same car – Column on 20:34 - Feb 21 by SimonD |
Remember that we had 4 years of parachute payments after being relegated from the Premier League. These payments are included in the revenue figure. Allowances were made for a reduction in revenue and I have allowed what I believe is the minimum level of these. The calculations I've made are shown on one of the linked articles.
In theory, the owners could vote to end FFP if they wanted to. What I don't know is how EUFA would react to this as FFP is their (Michel Platini's) scheme. The majority of owners want FFP. |
why do owners want FFP? |  |
| Occasional providers of half decent House music. |
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| Always crashing in the same car – Column on 22:26 - Feb 21 with 7807 views | SydneyRs |
For now I am prepared to believe we'll be ok given the January activity etc. The CEO's honeymoon will end very quickly if we aren't. | | | |
| Always crashing in the same car – Column on 22:50 - Feb 21 with 7726 views | Benny_the_Ball |
| Always crashing in the same car – Column on 20:14 - Feb 21 by SimonD |
These accounts are for last season (22/23). The crunch season is this one (23/24).
If we get through this one still in this division and without suffering a points deduction we will be in a better place. I do hope that they have learnt from this and don't act in the same way. |
OK but one thing I'm slightly unclear on is when the FFP situation will come to the boil.
My understanding is that company accounts are published 1 year in arrears (so 22/23 was published this week). Whilst this season's data will be key, season 23/24 accounts won't be published until next year. However, you mention in your article that Football League clubs have to submit Future Financial Information to the EFL by 31st March.
This raises the question; can the EFL take action this year based on projected accounts or do they have to wait until the 23/24 accounts are officially published? Common sense dictates the latter to me but I'd appreciate confirmation nonetheless. [Post edited 21 Feb 23:04]
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| Always crashing in the same car – Column on 22:53 - Feb 21 with 7715 views | kensalriser |
| Always crashing in the same car – Column on 21:37 - Feb 21 by PunteR |
why do owners want FFP? |
My guess is because it puts a brake on the arms race that sees player wages infinitely spiral. |  |
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| Always crashing in the same car – Column on 23:02 - Feb 21 with 7687 views | BrianMcCarthy |
Concise and easy to underatand (well, kind of...!)
Thanks a million, Simon. |  |
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| Always crashing in the same car – Column on 23:23 - Feb 21 with 7630 views | Jevlar |
Excellent article Simon, and as someone currently studying accountancy it helped sharpen up a couple of things I’m learning! |  | | |
| Always crashing in the same car – Column on 06:24 - Feb 22 with 7308 views | Wilkinswatercarrier |
| Always crashing in the same car – Column on 22:50 - Feb 21 by Benny_the_Ball |
OK but one thing I'm slightly unclear on is when the FFP situation will come to the boil.
My understanding is that company accounts are published 1 year in arrears (so 22/23 was published this week). Whilst this season's data will be key, season 23/24 accounts won't be published until next year. However, you mention in your article that Football League clubs have to submit Future Financial Information to the EFL by 31st March.
This raises the question; can the EFL take action this year based on projected accounts or do they have to wait until the 23/24 accounts are officially published? Common sense dictates the latter to me but I'd appreciate confirmation nonetheless. [Post edited 21 Feb 23:04]
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EFL would have to wait for actual rather forecasted financial results.
Imagine the potential legal implications of penalising a club for something that may not happen.
Reading the report, I've already explained to my son not to expect any multi million pound signings for the next few years though. | | | |
| Always crashing in the same car – Column on 07:33 - Feb 22 with 7182 views | Northernr |
| Always crashing in the same car – Column on 22:50 - Feb 21 by Benny_the_Ball |
OK but one thing I'm slightly unclear on is when the FFP situation will come to the boil.
My understanding is that company accounts are published 1 year in arrears (so 22/23 was published this week). Whilst this season's data will be key, season 23/24 accounts won't be published until next year. However, you mention in your article that Football League clubs have to submit Future Financial Information to the EFL by 31st March.
This raises the question; can the EFL take action this year based on projected accounts or do they have to wait until the 23/24 accounts are officially published? Common sense dictates the latter to me but I'd appreciate confirmation nonetheless. [Post edited 21 Feb 23:04]
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I think, happy to be corrected, they basically put you under a transfer embargo for the summer. And then the points punishments etc follow later.
We'll know because there is now a bit on the EFL website where they list the clubs under embargo after a few (Sheff Wed, Reading, Derby) tried to style it out with their fans pretending they weren't. |  | | |
| Always crashing in the same car – Column on 08:43 - Feb 22 with 6998 views | enfieldargh |
The increase in TV money next season will have no effect if we fall foul of FFP, it will only allow us to splurge a bit more in the hope of accumulating enough points to suffer a points deduction?
It wont be 10 points more like 20 points with our FFP criminal record.
But you can recruit cleverely(not tom) without spunking millions. Our most pressing handicap is not producing any exceptional talent.
Re other clubs I dont think Millwall have had any major player sales but it hasnt stopped them paying large fees for several players. |  |
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| Always crashing in the same car – Column on 08:46 - Feb 22 with 6985 views | cpgerber |
If we DO fail to meet FFP, it won't be by millions, right? So we could be lucky and get a 3-6 points reductions instead of the max 12?
(Dunno why I am thinking 12 is the max) | | | |
| Always crashing in the same car – Column on 09:17 - Feb 22 with 6863 views | SimonD |
There is an EFL tariff for breaching FFP:
The penalty for breaching of the 3 season P&S reporting rules is a deduction of 12 points to commence in the season following the breach.
The following number of points shall be deducted from the 12 points
9 points if less than £2.0m
8 points if between £2m and £4m
7 points if between £4m and £6m
6 points if between £6m and £8m
5 points if between £8m and £10m
4 points if between £10m and £12.5m
3 points if between £12.5m and £15m
No deduction if the breach is greater than £15m
Then the balance shall be further reduced if the loss in the final season is less than the season(s) before.
The Guidelines go on to show that a diminishing trend in spending may then be taken into account as demonstrating an intention to comply with the rules. Aggravating and mitigating factors are then available for consideration.
From the more recent breaches, they seem to apply about half of this, presumably on the understanding that the decision is not appealed. | | | |
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