When a club pays for a player, that is the timing of instalments, have absolutely no impact on PSR.
PSR is a profit based check not a cash flow based check.
In this particular case, the fee involved is widely reported as €3.5 which is £3m give or take a few quid.
The contract length is expected to be four years.
For PSR purposes that fee of £3m is spread equally over the total length of the contract. So it is charged at £750k per annum, or £62,500 per month (the calculation is done monthly although reported annually as per the financial statements with the caveat that clubs forecast in advance but that had no bearing here).
If Walta had been signed permanently now that would have had an efffect of charging 5/48ths of the fee to the club’s profit and loss account this year (which ends on 30th June).
That’s a total impact on PSR this year of £312,500. It makes no difference whatsoever if the fee is paid in one go or over 4 years, the cost to this year’s profit and loss account will always be £312,500. That’s because it’s a profit and loss measure not a cash measure.
The allowed loss for each three year period is £39m (caveat that I think it’s still at £41.5m as they increased it by a couple of million because of Covid and cost of living type stuff but that may have been removed so let’s assume it’s still £39m. That’s a rolling figure, so this year that we are in (year ended 30 June 2026) will be the third year of. Y/e 30/6/24, y/e 30/6/25 and this one. Plus it will be the second year of y/e 25, y/e 26 snd y/e 27 and the first year of the next set.
If revenue increases next season (which feeds into how much you can spend as it increases profit / decreases loss) then the two measures which take future years into consideration can be ignored.
So it’s only this year as the third of three that can be affected by loaning a player rather than signing one.
If we are so close to a £39m loss limit (or could be £41.5m as previously mentioned) that we don’t buy a player when it would have an impact of only £312k on the figures, then to be frank, we wouldn’t have been looking at signing Ward, or the two centre backs targeted or Nunes. And, in fact, we wouldn’t have brought in another midfielder at this point either.
The player's salary will be being paid anyway which also feeds into PSR but that has no effect as it feeds in whether you loan them or buy them (at the cost to you). I find it difficult to believe that a club will allow a loan for no fee but let’s say that they have for whatever reason so we can ignore that.
The reason I talked about owners putting money in was the possibility that it was a cash flow issue (not PSR). An owner can’t put money in to help PSR. The only thing that allows you to spend more is making more. So more commercial revenue, match day revenue, prize money, profits in player sales. We are obviously doing what we can on all those but particularly commercial and player profits.
It should also be mentioned that you can’t tell from financial statements what the PSR figures are because certain costs of a club that hit its profit and loss account are excluded. These include costs of infrastructure, the costs of academies, women’s football etc. what you can say is that the loss reported in the accounts is greater by some distance than the loss for PSR as those costs add up to at least a few million (the academy is about £2m or so per annum from memory).
Anyway, the likelihood of this being to do with PSR is remote for the reasons explained above although I have no doubt that that is the line being given.
