Club Finances

[WentToSchoolWith]

Is anyone out there well-versed enough to explain our FFP/PSL status?

I was under the impression we'd be alright because of our releatively low net spend on transfer fees, but realise now that wages play a large part which could completely nail us.

Additionally, when does it reset? How does the Grimes/Whittaker money play a part? What's the secret to life?

 

[Nocountryforoldjack]

What even is PSL

 

[WentToSchoolWith]

What even is PSL

Apologies, meant PSR. Profit and Sustainability Rules, it's the thing that bit Forest and Everton last year, can only spend so much per season in regards to your income

 

[jack_lord]

Isnt Pedersen on a big wage as well?

 

[NorfolkSwan]

This video is from 8 months back which shows a general slide downwards. Last published accounts seem to be from July 2023, I'm sure someone with more knowledge may have a projection for July 2024

 

[Swanjaxs]

Early days, but getting the impression that our new American investors are as transparent as the previous incumbents. Out of the frying pan and into the fire, anyone...?

 

[Nocountryforoldjack]

Apologies, meant PSR. Profit and Sustainability Rules, it's the thing that bit Forest and Everton last year, can only spend so much per season in regards to your income

Thanks mate, never heard of it.

 

[Adsubianjack]

A good friend of mine says that Swansea Independent are well versed on all things P&S.

However I've just read their report where they say the Grimes money will not be included in this term's P&S revenue calcs but the reduction in his wages will be. Which seems a bit odd but my friend assures me they are across all things P&S.

 

[Smurph]

A good friend of mine says that Swansea Independent are well versed on all things P&S.

However I've just read their report where they say the Grimes money will not be included in this term's P&S revenue calcs but the reduction in his wages will be. Which seems a bit odd but my friend assures me they are across all things P&S.

They get all their info off Russell Grant.

 

[LeonWasTheDogs]

A good friend of mine says that Swansea Independent are well versed on all things P&S.

However I've just read their report where they say the Grimes money will not be included in this term's P&S revenue calcs but the reduction in his wages will be. Which seems a bit odd but my friend assures me they are across all things P&S.

That doesn’t sound right. Incoming fees have to be included in their entirety in the year the deal is done (are we deferring payment for him; that would be irregular and not helpful). Wages, yes of course they will come off the books. Purchases are split equally across the length of the contract (amortisation).

I think the year runs from 1st July to 30th June.

We’ve got very little wiggle room this season. We’re allowed £41.5 million of cumulative losses before tax over the last 3 years. Accounts for 21/22 show a loss of £13.2 million and for 22/23 £17.9 million (from Swiss Ramble - https://swissramble.substack.com/p/swansea-city-finances-202223).

That means we can make a loss of up to
£10.4 million for the current year to end-June. So we need to do better than the last 2 years. Last year was bad as we had no significant player sales, but the windfall from Whittaker and Grimes’ fee (if he goes) buys us a bit of wiggle room this year. It will be tight though,

Edit - Ignore that last paragraph - I’ve missed a year. It’s 23/24 that’s relevant to whether we meet the P&S rules. Obviously the income/expenditure for that season has finished, but the accounts for that year won’t be announced unti the spring. They won’t be good, as we paid off a manager, wasted money on shit players and didn’t benefit from player trading. But it’s impossible to know for sure unless you can see the accounts.

 

[Andrew - North Hill]

That doesn’t sound right. Incoming fees have to be included in their entirety in the year the deal is done (are we deferring payment for him; that would be irregular and not helpful). Wages, yes of course they will come off the books. Purchases are split equally across the length of the contract (amortisation).

I think the year runs from 1st July to 30th June.

We’ve got very little wiggle room this season. We’re allowed £41.5 million of cumulative losses before tax over the last 3 years. Accounts for 21/22 show a loss of £13.2 million and for 22/23 £17.9 million (from Swiss Ramble - https://swissramble.substack.com/p/swansea-city-finances-202223).

That means we can make a loss of up to
£10.4 million for the current year to end-June. So we need to do better than the last 2 years. Last year was bad as we had no significant player sales, but the windfall from Whittaker and Grimes’ fee (if he goes) buys us a bit of wiggle room this year. It will be tight though,

Edit - Ignore that last paragraph - I’ve missed a year. It’s 23/24 that’s relevant to whether we meet the P&S rules. Obviously the income/expenditure for that season has finished, but the accounts for that year won’t be announced unti the spring. They won’t be good, as we paid off a manager, wasted money on shit players and didn’t benefit from player trading. But it’s impossible to know for sure unless you can see the accounts.

So, in very simple terms:

We're Friar Tucked, expectations need to be managed, and we shouldn't be surprised if the Grimes & Abdullai cash goes into the coffers and stays there until the summer.

 

[ARQS]

That doesn’t sound right. Incoming fees have to be included in their entirety in the year the deal is done (are we deferring payment for him; that would be irregular and not helpful). Wages, yes of course they will come off the books. Purchases are split equally across the length of the contract (amortisation).

I think the year runs from 1st July to 30th June.

We’ve got very little wiggle room this season. We’re allowed £41.5 million of cumulative losses before tax over the last 3 years. Accounts for 21/22 show a loss of £13.2 million and for 22/23 £17.9 million (from Swiss Ramble - https://swissramble.substack.com/p/swansea-city-finances-202223).

That means we can make a loss of up to
£10.4 million for the current year to end-June. So we need to do better than the last 2 years. Last year was bad as we had no significant player sales, but the windfall from Whittaker and Grimes’ fee (if he goes) buys us a bit of wiggle room this year. It will be tight though,

Edit - Ignore that last paragraph - I’ve missed a year. It’s 23/24 that’s relevant to whether we meet the P&S rules. Obviously the income/expenditure for that season has finished, but the accounts for that year won’t be announced unti the spring. They won’t be good, as we paid off a manager, wasted money on shit players and didn’t benefit from player trading. But it’s impossible to know for sure unless you can see the accounts.

So what happens if the accounts are produced before the spring and we have lost say £15m in that time?

Is there any mitigation if this year has been better so far and we can demonstrate money in? Or are we screwed regardless?

Presumably we are then allowed £41.5 of losses over 22/23 23/24 and 24/25 when they announce it spring 2026? And if it's more, it's more trouble?

 

[magicdaps10]

So, in very simple terms:

We're Friar Tucked, expectations need to be managed, and we shouldn't be surprised if the Grimes & Abdullai cash goes into the coffers and stays there until the summer.

Doesn't the Piroe,Wood and Martin money in this year's accounts?

We have cut the wages quite a bit so that will certainly help.

 

[Uxy]

Yeah, incoming transfer fees are recognised in the period they occur while purchases are spread over the life of the contract. It’s how Chelsea get round the rules with some exceptionally long contracts.

The headline £39m as was (slightly more now) allowed losses over 3 years has a few caveats. Some costs such as infrastructure, Academy and women’s section are excluded. Covid allowances plus a few other things too. Published accounts only really give us an indication.

As fans we’re always up to 18 months behind on this as the clubs accounts are published in arrears. However the EFL won’t be and the club has to keep up to date projections with them … were aiming for real time but no idea if they actually got round to doing that. But certainly relatively up to date.

I doubt we’re that close to the threshold as it goes, and Grimes going will help that in the short term (let’s not worry about the future …). Our problem has always been cash or lack of it .. this Swedish chap won’t help our ability to move this January I’d wager.

 

[T8AD365]

Couldn't our amazing new owners just sponsor the kit/stadium/training ground, which would enable us to close some of the gap in the finances?

How much money are we actually making from the likes of Reviva, Westacres and Swansea Building Society? I get that the club wants to support local businesses but they could be (and probably are) doing themselves out of a better deal with a bigger company.

I know any sponsorship deals have to be at a realistic value (unless you're Man City) but I don't think anyone sponsors Fairwood at the moment?