Sources: ‘Real concerns’ new FFP law set to impact Liverpool and Man City
There are “real concerns” that the new Uefa FFP rules set to be imposed on the likes of Man City and Liverpool are open to obfuscation, Football Insider has learned.
Uefa approved the introduction of a system of new financial controls in April, with clubs competing in its competitions now limited to spending 70 per cent of turnover over a rolling three-year period on wages, transfer and agent fees.
Apprehensions about the new system stem from its assessment windows, which run from 1 January to 31 December.
The previous arrangement, which limited clubs to a €30million owner-covered loss over three years, was assessed on a season-by-season basis, i.e 12 months from the date that Uefa competitions start.
This is a “real concern”, according to one industry expert, because most clubs release their annual accounts based on the 12 months up to 1 June.
That means it will be difficult for outsiders to check whether a club is within FFP parameters because it is impossible to ascertain which Uefa assessment period their profit/loss falls within.
The rules, which are officially called Financial Sustainability and Club Licensing Regulations, are being phased in from the beginning of the 2023-24 Uefa season.
Aside from concerns about transparency, the regulations will be relatively easy for club accountants to adapt to.
Chartered accountant and football finance analyst Viva Mukherjee told Football Insider: “The profit and loss account will need some work, but most major businesses and certainly most football clubs do internal monthly management accounts, and it shouldn’t be hard to change format for FFP purposes.
“Some work will need to be done, however. Revenue for broadcast and commercial deals will need to be worked out pro-rata between two football seasons.
“Matchday income will also need to be prorated too. It’s easy enough to do that.
“Wages and amortisation will need a bit of work as two seasons may have a different dynamic in the squad. Other expenses should be easy to separate.”
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