Chelsea Rumours Archive February 10 2013

10 Feb 2013 20:48:00
Just a curious post here.

Obviously we need a new centre forward and a strong holding midfielder in the next transfer window.

For me the centre forward is between Falcao and Cavani. I would choose Cavani basically because he's a year younger than Falcao and would be a better investment. And of course we then would be able to keep Courtois instead of including him in a deal for Falcao.

Now for me I am struggling to find a tall presence for the holding role. I think with someone a lot bigger it allows us to play Hazard, Mata and Oscar in the attacking trio.

Fellaini has basically told Chelsea to bid for him in the next window but I couldn't see him fitting into our system unless we play him behind the striker and drop Oscar alongside Luiz who has obviously taken to the holding role well and should continue playing there.

There have been a lot of people we've been linked with as a big presence for example: - Fernando, Fellaini, Fernandinho, Capoue and Paulinho.

With a world class striker and Ba as our two strikers we would be able to rotate them during midweek games.

For me Cavani would be the striker haven't gota clue who should be the holding player though just wondering who everyone else would like to join?

CfcBenWxm

Why does the DM need to be tall? The greatest DM in the last 20 years and perhaps ever, was 5'7".

Why don't you name him then

CfcBenWxm

Super makalele!

You need to told?

Of course it was Claude.

I find it troublesome that you completely ignore the fact we urgently need a top defender. Don't make it sound like we are two players away from winning the league.

JG

10 Feb 2013 18:11:58
Hi ed was wondering were all saying we're going to buy falcao which ( I hope we do ) but do you no if England is top of his list to come to many thanks {Ed002's Note - I really have no idea if he has any sort of list in mind.}

10 Feb 2013 17:00:45
Ed just out of intrest I know new financial rules were agreed over last week or so and the uefa rules kick in soon so is the summer the last transfer window where the majority of clubs across europe can freespend there moeny before being restricted or do the rules already apply now {Ed002's Note - It is not as simple as that - you need to read and understand the FFP rules:

The Demystification of the Financial Fair Play Rules (FFPR)

Introduction

I will try and simplify and summarise the FFPR and give examples where I can.

Putting aside all of the “mother country” fluff, the fundamental purpose of the FFPR is to:

(1) Ensure that clubs are operating within their means with transparent financial reporting. Example: Arsenal has debt which they can manage from the money they make as a club (good). Anzhi has a very low turnover given the amount of money they spend on players through donations from wealthy owners (bad).

(2) Protect creditors. Example: When Portsmouth went bust they owed money for players (the extreme case being Glen Johnson who had moved to Liverpool but Portsmouth still owed Chelsea for), money to local businesses (tradesmen who had worked at the ground, newsagents etc.), utility companies, the police et al (bad).

(3) Encourage responsible spending. Example: Liverpool under Hicks and Gillett borrowed money against the value of the club in order to buy players (bad).

(4) Protect the long-term viability of European club football. Example: They want to avoid the scenario of clubs entering administration or going out of business.

The FFPR apply to all UEFA club competitions and will actively come in to force from the end of June 2014 taking account of the financial monitoring period (the season just finished) and the two prior reporting periods (the two seasons before that). So when they first start, the FFPR will look at the 2013/2014 returns, and they will give consideration to the 2011/12 and 2012/13 figures.

I should make clear that it is not the full accounts of a club that are being considered, but just the “relevant” income and the “relevant” expenses. “Excluded” expenses are critical to the FFPR calculations. To this end, all clubs will need to effectively produce two sets of accounts. An audited set which are provided to Companies House and the relevant revenue organisations, and a second audited return laying out the “relevant” income and the “relevant” expenses for the purpose of the FFPR.

Relevant Income

(1) Match day gate receipts. Example: The money made by the club from paying fans attending games. This includes income from cup games when played away from home where a proportion of the gate money goes to the away side.

(2) Broadcasting rights. Example: Television income for games, money provided for radio broadcasting.

(3) Income from commercial activities. Example: Sales of bobble hats and rattles, club shop income, licensed income (e.g. DVD sales). In the future you can expect to see income from other media (e.g. streaming of games on a pay-per-view basis to the web and phones) increase.

(4) Prize money. Example: income from the Premier League, Champions League etc..

(5) Sponsorship. Example: Shirt sponsors (Standard Chartered, Samsung etc.), shirt manufactures (Adidas, Warrior etc.).

(6) Advertising. Example: Companies who buy time on video screens during games or hoardings at the stadium.

(7) Other operating income. Example: Payments made to a club for playing friendly matches in the Far East.

(8) Income from transfers: Example: All income from the sale of a player regardless of payment being due to previous clubs, the player himself etc. as they are allowable expenses which will later be deducted.

(9) Excess proceeds on the sale of tangible fixed assets. Example: The money Arsenal from converting part of Highbury in to apartments and selling them.

(10) Other income: Example: Interest on investments.

Relevant Expenses

(1) The costs of running the business (confusingly referred to as “the cost of sales” by accountants etc.). Example: Wages, ground maintenance, lighting, telephones, IT equipment, travel costs, policing costs etc..

(2) Employee related benefits and associated costs. Example: Costs of providing insurance, dental care, medical, employer NI contribution, housing, loyalty bonuses etc..

(3) Other operating expenses. Example: Payments for advertising, legal fees, agent fees, accounting fees, payments to players in relation to transfers, payments to player’s previous clubs, etc..

(4) Amortisation or transfer costs. Example: The total amount of money paid to another club to transfer a player or, if a club decides to do so, the amortised cost for that year (where a club is spreading the cost of the transfer out over the length of his contract for accounting purposes).

(5) Finance costs. Example: Bank charges, interest on loans etc..

(6) Dividends. Example: The owners may take a dividend from the profits a club makes as income.

Excluded Expenses

(1) Depreciation of tangible fixed assets. Example: The loss, if any, in value of the stadium, cars, IT equipment etc..

(2) Costs associated with the intangible fixed assets (other than player registrations). Example: goodwill, franchises, trademarks, copyrights etc..

(3) Expenditure on youth development activities. Example: All youth development expenses (housing, schooling, travel, medical etc.) are excluded from the calculations.

(4) Community development activities. Example: Outreach programmes, donations to the local community and charities, provision of equipment etc..

(5) Tax expenses. Example: Monies paid to the Inland Revenue, VAT etc..

(6) Finance costs related to construction of tangible fixed assets. Example: The interest on the £300M loan to build a new stadium.

(7) Interest payments on old loans (pre June 1, 2011). Example: Any interest due on a loan taken out for whatever purpose before June 1, 2011 is excluded from the calculations.

(8) Certain expenses from non-football operations. Example: This does not really apply to British clubs, but in other European countries clubs are often “sporting clubs” and have basketball, football, hockey team etc. all under one business.

The Calculation

FFPR calculates from a club’s “relevant” income and the “relevant” expenses whether the club is running at a surplus (profit) or deficit (loss) within a Monitoring Period (e.g. 2013/14). From this the FFPR decides if a club has met the “break even” requirement or not. This is not met if the “relevant” expenses exceed the “relevant” income by more than 5M euros (an acceptable deviation).

If the club exceeds this acceptable deviation, the owners of a club may contribute toward correcting it to a maximum of 45M euro over a rolling three year period (30M euro from 2015/16 on). Example: If Club X made a loss of 50M euro in 2013/14 due to the purchase of players, the calculation will ignore the first 5M euro and assume an owner contribution of 45M euro and there would not be an issue. However, for the two years following, there would be no allowable owner contribution as the full allocation had been used. If Club Y made a loss of 30M euro in 2013/14 due to the purchase of players, the calculation will ignore the first 5M euro and assume an owner contribution of 25M euro and there would not be an issue. But in this case, for the two years following, there would still be 20M euro allowable as owner contribution to cover further losses.

The Punishment

The Threat: If a club has been determined to have violated the “break even” requirement for a season it may be excluded from the next season’s UEFA competitions.

Likely Situation: If a club can show it has been moving in the right direction and doing what it can to overcome financial issues, perhaps brought on by a recession (e.g. in Spain) then I would expect a strongly worded letter as a warning. Perhaps by then end of the 2016/2017 season, If a club has been determined to have violated the “break even” requirement for several seasons then it may be excluded from the next season’s UEFA competitions.

UEFA are willing to make some exceptions to the rule and have already said they will consider:

(1) The quantum and trend of the break even result. Example: Chelsea has spent a lot this summer rebuilding an aging squad, so even with considerable additional income from winning the Champions League it could violate the “break even” requirement. However, spending less next season will show the club moving in the right direction. Expect a strongly worded letter in a couple of years time.

(2) Debt situation. Example: A possible “get out” for Barcelona, Real Madrid and Manchester United should they have a bad season and need to violate the “break even” requirement. Consideration will be given to the existing debt and the ability of the clubs to service that debt. The trend of the debt reducing and an excuse of “one bad season” and “need to rebuild the team” would likely result in a slapped wrist.

(3) Fluctuating exchange rates. Example: All non eurozone countries need to report the FFPR figures in euros which could fluctuate due to the exchange rate, whereas a number of the UEFA figures are fixed amounts (e.g. the 5M euro acceptable deviation).

(4) Projected figures. Example: UEFA will allow clubs to show that they are moving in the right direction if they provide projected figures showing that the “break even” requirement will be met in the following season.

(5) Force majeure. Example: Any extraordinary events or situation arising that is beyond the club’s control will be taken in to account.

(6) Until then end of 2014/15 only - Ongoing reductions in wage costs. UEFA will be flexible over the “break even” requirement if a club can show that their wage bill has been reducing and with the exclusion of wages of players signed before June 1, 2010 they would have met the “break even” requirement. Example: An escape route for the likes of Chelsea prior to prior season with Drogba, Anelka, Bosingwa, Kalou, Cech, Terry, Lampard etc. wages excluded from the calculations. A possible future escape route for the likes of Barcelona.

The Issues

There are a number of matters that UEFA still need to figure out and a number of concerns that certain clubs and certain national associations have. Off the top of my head:

(1) Loopholes: Whilst UEFA has done what it can to block any potential “loopholes” it is well aware that exclusion of wages for players signed before June 2010 is one it has introduced itself, and one that will be popular with the higher paying clubs as a short term escape route through to the summer of 2015. The matters of excessive sponsorship will be addressed via a cap to thwart the concerns over the likes of Manchester City abusing the rules. The cap has yet to be finalised but will require ratification.

(2) Soft Sponsorship: UEFA are concerned at the aggressive approach to obtaining sponsorship some clubs are taking. Questions are being asked about the ethics in clubs having airline travel partners, photocopier partners etc.. The Spanish clubs have raised this as a concern.

(3) National Sponsorship Variations: As we have seen tobacco sponsorship leave Formula 1 UEFA would like to see alcohol sponsorship out of football. We already have a situation where sponsorship by alcohol related businesses are forbidden in certain countries. Wealthy breweries are now focussing their sponsorship in other countries thereby creating a perceived imbalance in what income clubs are able to obtain in sponsorship. The French and Russian clubs have raised this as a concern.

(4) National Financial Distribution Variations: Concerns exist in countries where different models are used for distributing prize money, contributing to the grassroots game and distributing income from television and other media broadcasting. This led to an original request (rejected) from a number of clubs to restrict the FFPR to only the wealthiest of clubs, those with a turnover in excess of xM euros.

(5) National Taxation Variations: There is a considerable difference across UEFA nations in taxation, and this is seen to be reflected in the wages paid to players. The Spanish clubs have raised this as a concern.

(6) Third Party Ownership: Countries that allow third party ownership of players are seen to have a distinct advantage in being able to keep the costs of transfer fees low as they are only paying for a proportion of a player. The English clubs have raised this as a concern.
The Great Fear

Without going in to too much detail: (a) A number of clubs take the opportunity a once or twice a year to discuss various issues including changes in rules, television rights, the power of UEFA, exploitation issues for new technology streams, etc.. These discussions, the last of which were in late August, also always turn to the possibility and structure of a breakaway pan European league. Several are ex-G14 clubs, several are not, and some clubs decline involvement in such discussions. (b) The plan is that at some point a number of clubs would break away from their national leagues and UEFA. They accept that they would be banned from all existing club competition and the players would initially be banned from all FIFA competitions as well, but know that FIFA would be looking to negotiate in any case. It would be the end of UEFA in all probability and UEFA are very aware of this. It would also result in a restructuring of many of the national leagues. (c) The clubs would renegotiate their television rights, rights of distribution via other streams etc.. (d) It remains the greatest fear of UEFA and all major national authorities that one day this will happen.
}

Hi ed, so in terms of Chelsea, how well are we doing financially? I know that's broad, but although we made a profit last season, am I right in thinking chelsea would struggle to continue to spend the kind of money they currently do on players if hypotheticlly abramovich left tomorrow? Or had Chelsea become a much bigger club in the last few years and turnover now much larger? Basically, what is Chelsea's fuiancial state? Sorry for the long question, alessandro {Ed002's Note - Financial matters are not really an issue for discussion on these pages and certainlly bizarre hyothetical scenarios involving the owner leaving and these new owners from Tajikistan arriving in April 2014 are certainly not a matter I care to discuss at this time.}

New owners?

ED 002
Thank you very much for taking the time to set out and explain the workings of the FFPR.
Is it possible that you could place this answer in an archive which is easily and permanently available. This would give an easily accessible reference point to refer to. I for one would be grateful to know that I could go straight to this article when I need to, and hopefully you will not then be bombarded by the same general question as the time for introduction of these rules approaches.
Once again thans for taking the time to write such an indepth article for us.
B. G {Ed002's Note - We don't really have such archives and people would not look in any case. Just search on FFPR if youn need it - or cut and paste it in to a Word file.}

10 Feb 2013 12:03:37
does anyone else think that azpilicueta has come on leaps and bounds since joining us, he doesn't really steal the headlines but he gets up and down that line just as good as cole, can't wait to see how he developes over the coming seasons, what a bargin we got

also ED02 do you know if chelsea are looking to bring in a centre back in the summer?

-jack- {Ed002's Note - There are players to return from loan that need to be considered - and there is no immediate shortage of CBs. I suspect the focus will be elsewhere in the summer.}

Ed do you mean kalas and omeruo {Ed002's Note - And Chalobah but not Bruma.}

10 Feb 2013 11:04:34
Ed, in your opinion do you feel that Jose could return to Chelsea at the end of the season?
Many Thanks in advance {Ed002's Note - He could.}

10 Feb 2013 08:50:45
Hey Ed Fellow Chelsea fans,

Hope you are all doing well.

Ed Few of questions when time allows please.

1)Isco - I understand we are still in discussions with Malaga over the possibility of an advanced agreement for the transfer in your professional opinion would you consider this more likely to happen or still 50/50. Because I am sure you said there was considerable competition elsewhere for his signature.

2) Is Mauro Icardi an option that has been looked at I know he is young and not a Cavani or Falcao yet but the kid looks destined to become a world beater just wondering if the club has had a look at him?

3)This is a bit of a broad guess but I would wager the fact a new CDM/CM will be bought over the summer and that would mean we would have Rami, Mikel, Romeu, Lamps, Luiz even though most still see him has a CB (Not me). And oscar who looks destined to play that position in the future. So would it be Unreasonable or stupid to assume we may sell Mikel and romeu And bring in someone like fellani because I can't see us wanting to sell any of the 3 Brazilians, and Lampsy clearly on his way out Regardless, or do you see KDB taking the roll?

4)Any other intresting news regarding Chelsea you may have heard over the past week?

Thanks has always for your time enjoy the rest of your weekend along with all you other Chelsea fans.

BlueBen

CareeeeFreeeeeeeeeee! {Ed002's Note - (1) I really am not in the crystal ball business - I have explained the situation and I would rather not stick my neck out as that will lead to someone saying that I said it was "nailed on" and then all I get is abuse. (2) Mauro Icardi has been subject to interest from Monaco, Chelsea, Napoli and Fluminense. However, it looks like the player's preferred move to Inter beckons for the summer if they can put a proposal together that suits Sampdoria - and that will include some part ownership type transactions. Perhaps Napoli will push again. (3) The question names 7 or 8 players and is too convoluted to answer. If it is about takes or positions players will be utilised in, I have zero opinion on the matter. Sorry. (4) It is really not possible to answer such questions Ben - what interests me will not necessarily interest you or others.

And you have a great weekend as well.}

Ok that's totally fair enough Ed, Thanks regardless. Wish people weren't so abusive your opinions are worth 1000 Journo reports but because of a few we all suffer for it. Way it goes I guess catch ya soon fella.

BlueBen {Ed002's Note - Everything to do with Isco surrounds the debt due in March. I would suspect if they can borrow from a bank to pay that debt then Isco will move to Bayern Munich in the summer. If they cannot borrow, then perhaps a deal can be done.}

Thank you.
Blueben

10 Feb 2013 12:54:35
I suspect you will be made aware Ed in march, if the doubt has been succesfully paid by the bank loan? So you'll be able to tell us more about Isco's future in March? {Ed002's Note - If there is anything of note I will say.}

09 Feb 2013 23:17:50
Ed is it true that Chelsea are ready to offer £47mil+ Courtois for Radamel Falcao?
Don't get me wrong I love Falcao and there's nothing more that I want than him to join the Blues in the summer but I really really don't want us to give Courtois away. I've only seen this kid play twice (Europa League Final and against us) but he looked really good. Athletic, strong, commandant etc. In 3-5 years this kid will be worth around £20mil+ he's that good.
I'd say £47mil alone is suffice for Falcao.
Thanks in advance
Talberto {Ed002's Note - It is not quite as simple as that. I explained that Chelsea would like to get early agreement to fend off interest from elsewhere.}