CONFIMRED: Lucas Joao

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Stranded
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Re: Rumour: Lucas Joao

by Stranded » 06 Aug 2019 12:59

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Hound not sure anyone (with any sense) said Hector makes it cheaper, just that we won't be paying much for him this season

what it maybe did mean, is by signing Joao it meant Sheff Weds could afford Hector, hence it might be money we wouldn't have got if Chelsea had held onto him and kept loaning him out until he became ooc


Whether we pay much in cash for him this season is not that relevant. Our owners have cash. The accounting which is what matters for FFP, not the cash flows, is unaffected by the timings of the payments for Joao. If its £5m, its £5m divided by number of years of his contract, each year. If we have agreed to pay less money in order to forego Hector sell on, then perhaps we have paid less, and we may have never got Hector sell on money if as you say chelsea never went on to sell him. That is an interesting way of looking at it, fair enough.


Amortisation is 5m divided by the number of years on his contract. FFP is worked out on what actually goes through the books in any given year, is it not?

So whilst we will show a 5m asset on our books and his value going down 1m a year over 5 years (for example) but the payment schedule will effect FFP. So this year we have an 800k cost going out, in next years than maybe 2m - depends on the schedule we've agreed.

If it wasn't done on actual money going out/coming in via fees then that would lead to some amazing accounting skills to lower the prices of players in the book.

Happy to be corrected here if my understanding is wrong.

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Re: Rumour: Lucas Joao

by StellaPlease » 06 Aug 2019 13:04

I think that after all the fuss Howe made about FFP ( and rightly so) at the end of last season, we can assume ha has it in hand now and there is no need for the debate.

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Re: Rumour: Lucas Joao

by Hound » 06 Aug 2019 13:34

just watched this - if Gomes can get him performing consistently, we have one hell of a striker on our hands:

https://www.youtube.com/watch?v=qIE0n6DqyYA

and this is all in the champ before anyone comes up with the usual 'but look at the quality of the defending...'

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Re: Rumour: Lucas Joao

by Greatwesternline » 06 Aug 2019 13:48

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Hound not sure anyone (with any sense) said Hector makes it cheaper, just that we won't be paying much for him this season

what it maybe did mean, is by signing Joao it meant Sheff Weds could afford Hector, hence it might be money we wouldn't have got if Chelsea had held onto him and kept loaning him out until he became ooc


Whether we pay much in cash for him this season is not that relevant. Our owners have cash. The accounting which is what matters for FFP, not the cash flows, is unaffected by the timings of the payments for Joao. If its £5m, its £5m divided by number of years of his contract, each year. If we have agreed to pay less money in order to forego Hector sell on, then perhaps we have paid less, and we may have never got Hector sell on money if as you say chelsea never went on to sell him. That is an interesting way of looking at it, fair enough.


Amortisation is 5m divided by the number of years on his contract. FFP is worked out on what actually goes through the books in any given year, is it not?

So whilst we will show a 5m asset on our books and his value going down 1m a year over 5 years (for example) but the payment schedule will effect FFP. So this year we have an 800k cost going out, in next years than maybe 2m - depends on the schedule we've agreed.

If it wasn't done on actual money going out/coming in via fees then that would lead to some amazing accounting skills to lower the prices of players in the book.

Happy to be corrected here if my understanding is wrong.


I'm not a FFP auditor, but i am an accountant. If FFP is based on accounting profits, then it doesn't matter when you pay the money for a player. In accounting, buying a player is accounted for as ammortisation expense spread over the cost of the asset. The timings of the money paid to the other club are irrelevent. So no matter which way you spread the £5m payment, you would charge your accounts £5m / each year of his contract. The cash flows make no difference to the accounting profit or loss.

The accounting skills dont lower the price, they just spread the price over its useful economic life. If a company buys a van for £12,000, its not fair that its profit that year takes a £12k hit because they will use that van for 4 years. So each year 12k / 4 is the expense of the van, same as buying a player.

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Re: Rumour: Lucas Joao

by Greatwesternline » 06 Aug 2019 13:51

StellaPlease I think that after all the fuss Howe made about FFP ( and rightly so) at the end of last season, we can assume ha has it in hand now and there is no need for the debate.


No matter how much someone has it in hand, you can still debate and lament using £5m on one player, who may not turn out alright. Have we completely given up on signing up and coming players from lower leagues. Yes McNulty didnt hit the ground running, but that sort of signing used to be the key to our success. Not spending near record sums on other fairly average players in the same league, such as Barrow, Aluko, Bacuna.


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Re: Rumour: Lucas Joao

by Stranded » 06 Aug 2019 14:16

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Whether we pay much in cash for him this season is not that relevant. Our owners have cash. The accounting which is what matters for FFP, not the cash flows, is unaffected by the timings of the payments for Joao. If its £5m, its £5m divided by number of years of his contract, each year. If we have agreed to pay less money in order to forego Hector sell on, then perhaps we have paid less, and we may have never got Hector sell on money if as you say chelsea never went on to sell him. That is an interesting way of looking at it, fair enough.


Amortisation is 5m divided by the number of years on his contract. FFP is worked out on what actually goes through the books in any given year, is it not?

So whilst we will show a 5m asset on our books and his value going down 1m a year over 5 years (for example) but the payment schedule will effect FFP. So this year we have an 800k cost going out, in next years than maybe 2m - depends on the schedule we've agreed.

If it wasn't done on actual money going out/coming in via fees then that would lead to some amazing accounting skills to lower the prices of players in the book.

Happy to be corrected here if my understanding is wrong.


I'm not a FFP auditor, but i am an accountant. If FFP is based on accounting profits, then it doesn't matter when you pay the money for a player. In accounting, buying a player is accounted for as ammortisation expense spread over the cost of the asset. The timings of the money paid to the other club are irrelevent. So no matter which way you spread the £5m payment, you would charge your accounts £5m / each year of his contract. The cash flows make no difference to the accounting profit or loss.

The accounting skills dont lower the price, they just spread the price over its useful economic life. If a company buys a van for £12,000, its not fair that its profit that year takes a £12k hit because they will use that van for 4 years. So each year 12k / 4 is the expense of the van, same as buying a player.


That's fair enough and thanks for the explaination. I can only assume that FFP is calculated differently given certain costs that would appear in the accounts are discounted i.e. academy costs, the cost of the new training ground etc would all be in the club accounts but are exempt from the FFP calculation.

That raises an interesting thought actually. We all know that the 2017/18 loss was 20.9m but do we know if that is the reportable FFP loss? For example, included in that loss was an 800k loss by the Womens Club - which I believe can be discounted. A Category 1 academy is often quoted as a 2m cost a year, so can also be discounted too.

Is it possible that the FFP loss was less than expected and we therefore have a bit more wiggle room that we as fans expected?

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Re: Rumour: Lucas Joao

by Jinx » 06 Aug 2019 14:18

Reading fans: Waaaah we need a striker
Reading FC: We've signed a striker
Reading fans: Waaaah not that one

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Re: Rumour: Lucas Joao

by Danny Nedelko » 06 Aug 2019 14:18

Joao looked a beast when he came on the pitch on Saturday. Granted it was only for 20 mins and against Reading, but he looks like he will actually be able to hold the ball up and has got some skills to pay some bills.

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Re: Rumour: Lucas Joao

by Hound » 06 Aug 2019 14:19

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StellaPlease I think that after all the fuss Howe made about FFP ( and rightly so) at the end of last season, we can assume ha has it in hand now and there is no need for the debate.


No matter how much someone has it in hand, you can still debate and lament using £5m on one player, who may not turn out alright. Have we completely given up on signing up and coming players from lower leagues. Yes McNulty didnt hit the ground running, but that sort of signing used to be the key to our success. Not spending near record sums on other fairly average players in the same league, such as Barrow, Aluko, Bacuna.


And yet we sold Bacuna at a profit and sounds like could have quite easily sold Barrow at a profit as well

Aluko really was a horror purchase though. But as I said elsewhere, we can’t just view every signing through the signing of him. If João is worth 5m then so be it, we needed a striker
Last edited by Hound on 06 Aug 2019 14:22, edited 1 time in total.


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Re: Rumour: Lucas Joao

by WoodleyRoyal » 06 Aug 2019 14:19

Jinx Reading fans: Waaaah we need a striker
Reading FC: We've signed a striker
Reading fans: Waaaah not that one


you must be new round here

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Re: Rumour: Lucas Joao

by Jinx » 06 Aug 2019 14:20

Not new - it's just like deja vu all over again

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Re: Rumour: Lucas Joao

by Greatwesternline » 06 Aug 2019 14:21

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Amortisation is 5m divided by the number of years on his contract. FFP is worked out on what actually goes through the books in any given year, is it not?

So whilst we will show a 5m asset on our books and his value going down 1m a year over 5 years (for example) but the payment schedule will effect FFP. So this year we have an 800k cost going out, in next years than maybe 2m - depends on the schedule we've agreed.

If it wasn't done on actual money going out/coming in via fees then that would lead to some amazing accounting skills to lower the prices of players in the book.

Happy to be corrected here if my understanding is wrong.


I'm not a FFP auditor, but i am an accountant. If FFP is based on accounting profits, then it doesn't matter when you pay the money for a player. In accounting, buying a player is accounted for as ammortisation expense spread over the cost of the asset. The timings of the money paid to the other club are irrelevent. So no matter which way you spread the £5m payment, you would charge your accounts £5m / each year of his contract. The cash flows make no difference to the accounting profit or loss.

The accounting skills dont lower the price, they just spread the price over its useful economic life. If a company buys a van for £12,000, its not fair that its profit that year takes a £12k hit because they will use that van for 4 years. So each year 12k / 4 is the expense of the van, same as buying a player.


That's fair enough and thanks for the explaination. I can only assume that FFP is calculated differently given certain costs that would appear in the accounts are discounted i.e. academy costs, the cost of the new training ground etc would all be in the club accounts but are exempt from the FFP calculation.

That raises an interesting thought actually. We all know that the 2017/18 loss was 20.9m but do we know if that is the reportable FFP loss? For example, included in that loss was an 800k loss by the Womens Club - which I believe can be discounted. A Category 1 academy is often quoted as a 2m cost a year, so can also be discounted too.

Is it possible that the FFP loss was less than expected and we therefore have a bit more wiggle room that we as fans expected?


Yes, the FFP losses won't be as large as the accounting losses. Maybe FFP losses are published somewhere? Lots of Readings costs are training cost related. But, the spending on the academy is much like that of buying a player, the spending they are spending now doesn't hit the bottom line, its spending money on assets, so will be divided by the life of the training ground. Until the training ground is complete, it won't start being depreciated, so no expense is hitting the accounting profit at the moment...

But tbh, the main main cause of losses is player contracts, and player purchases.

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Re: Rumour: Lucas Joao

by WoodleyRoyal » 06 Aug 2019 14:22

Jinx Not new - it's just like deja vu all over again


don't remember signing him, where did he play?


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Re: Rumour: Lucas Joao

by Rollerbob » 06 Aug 2019 14:23

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StellaPlease I think that after all the fuss Howe made about FFP ( and rightly so) at the end of last season, we can assume ha has it in hand now and there is no need for the debate.


No matter how much someone has it in hand, you can still debate and lament using £5m on one player, who may not turn out alright. Have we completely given up on signing up and coming players from lower leagues. Yes McNulty didnt hit the ground running, but that sort of signing used to be the key to our success. Not spending near record sums on other fairly average players in the same league, such as Barrow, Aluko, Bacuna.


Barrow wasn't all that expensive really (wasn't it 1mil?). Plus he's still first team. Inconsistent sure, but so was Kebe. Just like you slate Aluko (rightly) and big money moves, you can look players from lower and lesser foreign leagues with the same eye.

How is Walker doing? How was John OShea? Pele Clement? Gravenberch? Anil Capkin? Sandro Weiser? Liburd? All of which were signed for little money, and have been a waste of time. We have a whole squad of 'upcoming young players from lower leagues'. (Loader, Olise, McIntyre, Nova, etc etc), so we don't need to focus on them.

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Re: Rumour: Lucas Joao

by Greatwesternline » 06 Aug 2019 14:25

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Jinx Reading fans: Waaaah we need a striker
Reading FC: We've signed a striker
Reading fans: Waaaah not that one


you must be new round here


I was really excited about McNulty, i thought, finally we've remembered what made us good. Signing people like Long, Doyle, Kitson, Le Fondre, N.Hunt up front, not signing people like Bacuna and Aluko. I wasn't unhappy with Bodvarrson. is this player going to be a lot better than Bod?

Its a shame it didnt work out for McNulty, he wasn't given much time.

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Re: Rumour: Lucas Joao

by Greatwesternline » 06 Aug 2019 14:26

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StellaPlease I think that after all the fuss Howe made about FFP ( and rightly so) at the end of last season, we can assume ha has it in hand now and there is no need for the debate.


No matter how much someone has it in hand, you can still debate and lament using £5m on one player, who may not turn out alright. Have we completely given up on signing up and coming players from lower leagues. Yes McNulty didnt hit the ground running, but that sort of signing used to be the key to our success. Not spending near record sums on other fairly average players in the same league, such as Barrow, Aluko, Bacuna.


Barrow wasn't all that expensive really (wasn't it 1mil?). Plus he's still first team. Inconsistent sure, but so was Kebe. Just like you slate Aluko (rightly) and big money moves, you can look players from lower and lesser foreign leagues with the same eye.

How is Walker doing? How was John OShea? Pele Clement? Gravenberch? Anil Capkin? Sandro Weiser? Liburd? All of which were signed for little money, and have been a waste of time. We have a whole squad of 'upcoming young players from lower leagues'. (Loader, Olise, McIntyre, Nova, etc etc), so we don't need to focus on them.


That is fair, i'd say our success rate with cheap players is sometimes good, sometimes bad. Our success with expensive players is almost unanimous bad.

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Re: Rumour: Lucas Joao

by Hound » 06 Aug 2019 14:36

Maybe, but that shouldn’t mean you just always buy cheap

McNulty didn’t really look up to it. He might have been given time but we can’t afford that. We’ve been bottom 5 four of the last 5 seasons. Get it wrong with a lower div punt this year and we could well go down

João isn’t that expensive relatively at £5m and is a proven scorer in the champ. It’s what we need

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Re: Rumour: Lucas Joao

by Rollerbob » 06 Aug 2019 14:37

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Barrow wasn't all that expensive really (wasn't it 1mil?). Plus he's still first team. Inconsistent sure, but so was Kebe. Just like you slate Aluko (rightly) and big money moves, you can look players from lower and lesser foreign leagues with the same eye.

How is Walker doing? How was John OShea? Pele Clement? Gravenberch? Anil Capkin? Sandro Weiser? Liburd? All of which were signed for little money, and have been a waste of time. We have a whole squad of 'upcoming young players from lower leagues'. (Loader, Olise, McIntyre, Nova, etc etc), so we don't need to focus on them.


That is fair, i'd say our success rate with cheap players is sometimes good, sometimes bad. Our success with expensive players is almost unanimous bad.


Im not so sure about that either tbh, but in recent times you are right. Look before Gorlay, and they've not all been flops.

Moore, Illori, Blackett, Norwood, D. Williams, Mariappa - They all cost us over a million (which in Reading fees is quite a lot), and all have done or did pretty well for us.

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Re: Rumour: Lucas Joao

by Royalwaster » 06 Aug 2019 15:02

So is he actually joining? If so, I like the fact that he can hit equally well with his left and right foot ...

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Re: Rumour: Lucas Joao

by Cape Town Royal » 06 Aug 2019 16:01

[quote="Hound"]Maybe, but that shouldn’t mean you just always buy cheap

McNulty didn’t really look up to it. He might have been given time but we can’t afford that. We’ve been bottom 5 four of the last 5 seasons. Get it wrong with a lower div punt this year and we could well go down

I agree with you..,

I don't quite get the hysteria around McNulty.. We bought two similar strikers last summer Baldock and McNulty... Baldock was the one that was supposed to be the instant success because he was more expensive and had championship pedigree.

McNulty for me was one that might take a year to get him used to the step up in standard, so yes he was relatively cheap, but it was always going to be about taking a talent and bringing him up to the level required.

For me the bigger disappointment is Baldock not McNulty. That said I think both have suffered because as a team we just didn't create enough. Pretty hard to get confidence as a consistent finisher if you are hardly getting any chances to convert.

Is that down to bad spending on strikers or the way the rest of the team is set up?

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