Boardroom turmoil taking its toll at fallen giant of the English game

Since the statement made by the second Independent Commission many months ago now, kicking this particular can down the road, there has been nothing. No indication that such a hearing has been scheduled, or when or even if it might take place.

It continues to hang, like the Sword of Damocles, over Everton's final preparations for the new season in the Premier League, amidst the faint hope that the PSR issues and threats of points deductions are finally behind them.

But no definitive word… justification enough for the flurry of worried voices?

Now we also have the undermining of Branthwaite 's situation rearing its ugly head again for the start of the season in addition to this nonsense about another points deduction.

From half a billion in spends to half a billion in debt in a few short years.

However, looking at things simply in big chunks terms, there will at least be a three-quarter-billion pound stadium at the end that will hopefully remain in ownership.

That's all I have.

Except:

"Strange how there was a flurry of clickbait stories at the weekend about the possible hearing and subsequent points deduction over Everton's interest payments."

Haven't found anything solid at all.

The panel reported the Premier League was in dispute with the club over how it had accounted for interest on loans said by the Blues to have been used in support of the construction of the new waterfront stadium. The commission deferred the argument, initially over a sum of around £6.5M, on the basis that a separate hearing would be needed due to the complexity of the matter.

Four months on, no resolution has been reached. Should a new hearing take place and if the Blues were to lose it, it could lead to a revision of the club's PSR position across the financial years that ended in 2021, 2022 and 2023 - and potentially by a larger sum than that initial £6.5M.

Such an outcome could therefore, in theory, lead to an additional deduction that would be imposed this season. That prospect remains distant at this stage and the club remains confident it can defend its position, however.

Sorry but I read it and posted without reading posts, hope it's not true as we have had enough of the corrupt Premier League.

If the stakeholder cannot understand how to apply its own regulations, then how can it expect a club to understand them?

If I was still working, I'd be licking my lips at the prospect of taking that one to court!

They were desperate for Tottenham to win the the league. Likewise in '95 when we ruined their dream final of Man Utd v Tottenham.

In my life time, I've just experienced an impassive attitude towards Everton, despite our status. Well, we'll show them.

Tottenham have an impressive stadium, and it is impressive. But big club? No bigger than Everton with only 2 league titles to their name. Last one in 1961.

This statement in the article tells you how rudderless Everton are under Moshiri. There has to be another business agenda with Moshiri as a frontman. The whole 777 Partners saga suited that agenda, until caught.

I estimated that Everton in the 2023-24 Financial Year would have to show a £12M profit to avoid a points deduction. Going by the doubling of loss in 2022-23 on the previous year, there seems no intent to address this issue.

I suppose that the only saving grace is the compensation that could have been sought under PSR by other clubs was not sought.

The quagmire that Everton are in is the result of this other agenda, which seems to have been in place since the Moshiri takeover and probably fitted into Kenwright's self-serving other agenda for Everton Football Club.

I put the possiblity of connections into AI months ago with success. Within days, AI had clamed up, refering me to Everton's and 777's Financial Statements saying they had no access to information.

Manchester City 115 charges explained: What is latest on club's PSR case?

When all this gets brushed under a carpet, the lumps will be visible from space! I dare say Everton's latest run-in regarding the determination of stadium costs will some way merit a similar level of points deduction that City will likely receive. Forgive the cynic in me, but I see another 40,000 order going to the printers for colored cards once more.

The less aware on here are probably under the impression that accountancy is a science. It is not, it is an art. As an old boss was once told (and advice he passed on to me), when you are asked for a number, then the first question is "Do you want a big number or a little number?"

The Technical Director wants to close or keep open an operation. If he wants to close it, he wants as small a number as possible to show how cheap it will be — minimum redundancy costs, maximum value for the land being sold. If he wants to keep it open, he wants a big number to say we can't afford to close it — see the unfunded pension costs, the huge cost of clearing the site.

Take buying a car. You have £15,000 in the bank and buy the car for cash. Or you buy it on a loan at 6,1% interest. You now pay £17,658. That is where accountancy becomes an art. Do you have an asset which has cost you £15,000 or one worth £17,658? But if the latter, what is the asset worth and are you overstating its value?

Of course when you have exceptionally wealthy owners or councils who give you the stadium for free, then who cares? It will be interesting how Spurs accounted for their interest payments and any other club who have built additional capacity. That becomes the precedent.

The huge debts we have on account of those two are appalling. Any prospective buyer, if not before, knows this full well after being invited to examine the accounts (Moshiri's allegedly expert forte of course — ha-ha!) before quickly leaving scorch marks on the Goodison tarmac where they first parked their cars.

This happened several times when Kenwright was in sole command. It stank then and it stinks now, and our club deteriorates accordingly, across the globe, every time it happens.

We've been massively fucked for decades by grossly self-serving shithouses and sadly, in my opinion, we'll be massively fucked again as a direct result of their misconduct.

Man City have been fined approx £2.5 million.for delaying the start of play during a load of games. I think that tells you an instalment plan has started regarding Man City misdemeanors.

Phil #16,

The dispute between Everton and the Premier League over loan interest was IMO a attempt to take the bad look of the Independent Commission decision and play into the narrative of a corrupt Premier League.

Everton withdrew it's appeal on the last Independent Commission decision. I don't think we will hear anymore on that other than click bait.

I know accountancy is an art, if you get an accountant that can be bothered. Certified Accountant Moshiri, going by the figures of the above article, seems not to be bothered.

Moshiri is owed approx £400 million from.his own dubious sources, charging no interest. £300 million.is owed to legitimate sources charging interest (higher than it should be) and £200 million, with interest, loaned sources in dispute in a New York courtroom.

These dubious and disputed funds seem to be the crux of the problem; running the Club appears to be a sideline not taken seriously as regards figures.

Don #17,

The current regime is a continuation of what went before, probably with some involvement of the same living protagonists, unless someone sees a ghost.

And to combat PSR, they are going to sell two of their hotels. To themselves!!

Now that smells to me.

Since 2022 Chelsea have bought 49 Players at a cost of £1.2 Billion (yes, billion).

How's that not breaching PSR?

Todd Boehly came clean to the Premier League regarding breeches of the previous regime. Also accepted a transfer ban. Regarding the Hotels they seem to have found a legitimate, though unfair, loophole.

They are a lot better run than Everton, though the recent Manager replacement is questionable

If they aren't arms length, then they're breaking some of the same rules as Man City's 115 charges are open with.

If those deals are okay, it opens it up for any club to deck chair move around assets to exploit PSR. In theory, Newcastle, who have been constrained in the transfer market, could just sell their stadium and training facilities to a sister company for a couple of £1B - and then go on a player splurge like Chelsea.

I would expect the two-tier Premier League to allow Chelsea, but not Newcastle, an Everton etc. It's the kind of thing they do.

'Time to resolve' Man City charges — Premier League chief

Not sure how that change was missed or pushed through?

PSR is still in place for this season and the alternative will not be in effect. It is being used as a “shadow” system to set the levels of expenditure and will come in to force next season.

Man City should still be charged and punished based on the rules in place at the time they allegedly broke them.

Oh, I forgot, football only started in 1992.

Yes, we were known as the Mersey Millionaires in those days. Even earlier, Sunderland were known as the Bank of England! How times change.

I would draw your attention to the other BBC article on the 115 Man City charges, cited by Christine @15, where it says:

The Premier League's current PSR system looks set to be in place for one more season, with a probable introduction of a new ‘spending cap' edging closer.

…

None of these developments impact City's ongoing case.

And that's because all their (alleged) crimes were committed between 2009 and 2023.

How do Chelsea get away with spending so much since 2022? Some of it is crafty accounting - but much of it is a business model based around high volume sales too. Since 2022 Chelsea have sold about £600m worth of players (and will have gained more in loan fees too).

This is the sad genius of our shitty neighbours too unfortunately. They have a net spend of only £200m or so in the past 4 years (less than West Ham and Forest and only just ahead of Bournemouth).

Some sobering lessons on how to run a club in the modern age.

I didn't see that article and hope the Premier League hold to their word.

I can see them trialling the new approach with Man City in favour of the old system. They shouldn't but we know how these things can work.

I was talking to a Manchester City supporting mate this morning. He was all doom and gloom and not even tongue in cheek. He said they'll be docked 20 points and be playing Wrexham next season!! Bit of an exaggeration.

Chelsea sign up players on 7-year contracts. They have just extended Palmer's contract by 3 years. So he will have been at the club for 10 years by the time his contract ends. So the £40M fee they paid Man City will be spread across those 10 years.

They just spread the fees they pay for players across longer contracts. They are basically buying players on the drip. Of course the downside is if the player turns out to be a misfit, they could be stuck with him for a long time.

Most Premier League clubs, including Everton, sign players on shorter 3-, 4- or 5-year contracts. So we are spreading any transfer fee over a shorter timespan.

If we had signed Gomes on a 7-year contract, he would still have 2 years to go. So you pays your money and you takes your choice. Longer contracts can make a player more affordable but a shorter contract is better if it turns out you bought a lemon.

Considering the number of overpriced and overpaid lemons Everton have bought in recent years it's probably better if we stick to shorter contracts for now.

"I can see them trialling the new approach with Man City in favour of the old system."

I'd be very surprised if that happened, Anthony. The quasi-judicial independent commission has to follow the book of rules as they was writ for the corresponding offences Man City are charged with.

There is simply no possible way that new spending cap rules, brought in initially on trial this coming season and possibly enforced in lieu of PSR from next season onwards, could have any effect on the historic charges Man City are facing.

But the Premier League then said any transfer fee had to be paid within 5 years. So you can sign a player for as long as you like, but the transfer fee must be paid over 5 years (or less).

They will be judged on the rules in the period they broke the rules.

But the Premier League does not have jurisdiction outside of it so I believe it can only relegate City who will then bounce straight back up.

Or didn't they go forward with it? Or could it be a reason to delay proceedings until the action is heard?

It may also have an effect on Chelsea's hotel sales.

The PSR rules are slightly different. Originally, you used to be able to amortise a player's value over the length of the contract. Chelsea started to exploit this by offering long contracts, eg, an £80M transfer over an 8-year contract appeared as £10M per year in the accounts.

The Premier League changed that after they cottoned on to what Chelsea were doing so now the maximum period you can use is the length of the contract up to a maximum of 5 years, so an £80M transfer would now appear as £16M per year on any initial contract of 5 years or greater. For a 4-year contract, it would be £20M per year.

Integrity is regarded as being amongst the highest qualities in that part of the World and I have read somewhere else, so take this as a pinch of salt, that why there is no interest from those parties maybe because Kenwright and his mate Phillip Green knocked them back prior to the Man City takeover.

Obviously I don't know whether that's true or not but having no interest from any party in that area seems to be a little odd considering.

That litigation is mentioned in the first BBC article linked above by Christine @15:

It emerged in early June that City are set to face the Premier League in a legal battle over the organisation's commercial rules.

It is in relation to associated party transactions (APTs), which can inflate revenue streams and allow more room for spending.

I would imagine that's a separate challenge and may be handled differently as City are the plaintiff in this one.

Any news on new owners? Over here, news we did get was that Everton will have to sell Branthwaite anyway to get money to stay afloat... any truth?

Christine's link at the BBC doesn't seem to say anything more than City raised the matter of an action over APTs in June.

As I understand it, City believe that sponsorship from companies within the club's owner's portfolio is perfectly acceptable in normal business dealings and therefore the Premier League has no right to make it illegitimate, ipso facto, they have no case to answer.

I don't know if there is an angle in this that medicates the risk that The Friedkin Group found in due diligence, that caused them to withdraw. But I suppose they would be available for talks having a £158M loan secured against the new stadium.

Please bear with me while I try and deconstruct that last paragraph a little…

Yes, that may well be Man City's argument, but the Premier League writes its own rules, with 14+ out of 20 majority support from the member clubs, for whatever gets on their statute book (aka Handbook, updated each season).

Back in November, the motion to tighten APT rules was passed by the narrowest margin possible with Crystal Palace and Burnley believed to have abstained, and with two-thirds of the remaining 18 clubs voting in favour of the new APT restrictions. Manchester City, Newcastle, Chelsea, Everton, Nottingham Forest and Sheffield United are understood to have voted against the Premier League on the issue.

But the row rumbles on with Man City having threatened to take legal action against the Premier League.

When you say "they have no case to answer" — presumably you mean the Premier League as they are the ones being challenged on the grounds that the APT restrictions would breach competition law?

Or did you mean Man City have no case to answer — because they are in the right when it comes to competition law?

Either way, I think there would be a case for the Premier League to answer… if Man City proceed with the legal challenge.

And of course, if Man City drop the threat of legal action, then there would obviously be no case to answer.

But that is clearly not the case, with The Times reporting that an arbitration hearing has already been heard, with a ruling expected in the next couple of weeks, and it's previously been claimed that, if Man City are successful, it would dramatically alter their FFP/PSR case as most of their 115 charges would become redundant.

And The Times claims that ‘there is a belief that City have achieved some successes in the arbitration hearing'.

The report also explained that the independent commission hearing into the 115 alleged breaches has been moved up to start next month, when previously it was expected to start later in the year.

But, as our friend Masters makes very clear elsewhere, confidentiality is the watchword for the Premier League's legal cases — and he still refuses to say when Man City's 115 charges will be heard.

So if a player is initially amortised over 5 years, but then at the end of 3 years he signs an extended contract then the remaining 2 years of value is spread over the 2 + extension years.

Is this another loophole that Chelsea are playing with in extending Palmer's contract after only 1 year?

I meant that City have no case to answer as it is quite legal to sponsor companies under the same owner's umbrella.

Thus City are taking legal action to clarify if the ban is reasonable or denies some sort of natural justice or accepted business practices or indeed occured before a rule change given some charges date back 15 years.

Thanks for your response.