Wayne Rooney is apparently negotiating a new deal worth £170,000 per week, which is not far off nine million per year. Would more than cover all of SL's losses.



It isn't just RL. In RU Leicester Tigers lost £750,000 last year. In football, Liverpool are skint, Manchester United are carrying a big debt burden, Chelsea rely on Abramovich and the downturn in property prices has badly hit Arsenal's development at their old ground. Dropping out of the cash cow that is the Champions League could put any of them in trouble.

While it [iis[/i a problem, it is not one limited to RL. The RFL deserve credit for implementing a 'communist'/american-style salary cap and have even gone so far as to embrace franchises, offering the top clubs a much higher level of security. But sport is about glory more than balance sheets and ambitious people will always take risks to try to get it.
There are exceptions - Hull have been run prudently, generating a profit. That is laudable, but it has contributed to them falling behind more ambitious clubs, on the pitch, and there have been calls for their prudent board to, well basically f*** off. They could carrying on that way, hoping to gain success as the last man standing, but the history of sport shows they'll likely need a lot of patience as it seems there are always wealthy people looking to buy a dream. Sometimes it turns out to be a nightmare, but it was ever thus.

According to todays League Express Hull FC present their accounts differently to every other club in that they they include a valuation of their players into their balance sheet.
The independent auditors have suggested that this (2008 valuation £942,500) should be removed from the balance sheet. The auditors have registererd a disagreement with the Hull directors.

It also appears that from 2009 all clubs have to lodge full accounts which includes a profit and loss account, so we should have some sort of conformity in the next set of presented accounts.

How do they arrive at this figure I wonder, not many would have had fees paid for them. 900k isn't much for a full squad of players is it.

Welcome to 4 years ago (at least).

Hull have always done this. It's not standard accounting practice so there is always a qualification (not a 'disagreement') marked in the accounts by the auditors.

And the player valuations have zero impact on P&L in any case. They sit on the balance sheet which is the sum of assets minus liabilities. This has nothing to do with the annual profit and loss accounts which are the things that everyone seems to be comparing at present.

Which is why it's not standard accounting practice to include them. Player valuations are entirely subjective and situational - a player is basically worth what someone is prepared to pay for him so there is no way to objectively value one as an asset.

Which has the square root of nack all to do with profit and loss.

If that's the case why do Hull do include them as assets on their balance sheet at all??. Surely it overstates the value of the clubs total assets and therefore its net worth

They are in profit and let that be the end of it.

Fits in with their fans perception of the club

I think you've answered your own question there. Though if somebody were stupid enough to fall for that trick when purchasing the club, they really shouldn't be trusted with that sort of money in the first place.

Has the list value of the players fluctuated to reflect the changes in the teams fortunes over recent seasons? Is it done player by player? I suppose you could do it as a proportion/multiple of their wage, for simplicity's sake. Or does somebody independent just have a best guess?

There's nowt wrong with it - it just seems a bit pointless... unless they really are hoping for a very gullible multi-millionaire buyer.

[url=http://www.hullfc.com/hullfc/contents/?page_id=4030Try here and report back if it's bothering you[/url

Exactly. It's a not-very-subtle bargaining device when it comes to discussions with potential buyers, otherwise as far as I can tell it has bugger all effect on anything. Net worth is meaningless unless you're either selling a business or winding it up.

Touchy!

Actually it 'potentially' does. Especially if you were required to remove them from your balance sheet.

If they were written off the balance sheet then this would mean the write down would either need to be shown as a cost in the P&L account or alternatively written off directly to reserves.

The thought has crossed my mind that the profit generated by FC for 2008 could potentially be purely due to an increase in the valuation of the players.

I am only summising and I wouldn't think this is likely, but you never know. Then again given last season I would think a reduction in the value of the players would be much more likely!!

Not at all.

The poster was confused about an accounting issue related to Hull FC's accounts. Thought I was helping that's all

Not at all. Just thought of our squads worth.
£920,000

The revaluation reserve. Which is completely separate to the Profit and Loss reserve, you mean.





Sweet baby Jesus and the orphans.





Get a copy of the accounts and check the balance sheet which includes a revaluation reserve. Just to spell it out in double-entry bookkeeping terms, the accounting entries go to fixed assets in the balance sheet, and the revaluation reserve, in the balance sheet, but not the P&L account, nor the P&L reserve.

The sort of "robust business model" that involves hiring a coach from Netto's, saves shed loads of cash by ripping off the fans and staying well under the salary cap by keeping the cash in order to post a profit only to go and buy it's players from the Antiques Road Show? - No thanks.

I agree the coach is an unnecessarily cheap option, but I'd settle for FC's balance sheet (which shows half your level of debt), 5 years of profitability, and independent credit rating over yours any day. Admittedly you've made some great investment decisions, though, like the £50,000 Hudgell said was spent on Saltend facilities.



As for ripping the fans off, that'd be charging £60 for a 2010 membership scheme in July 2009 that according to your chairman the fans don't understand, wouldn't it? Or ordering a £5 pair of socks from your website and automatically having a basket total of £10.50 - £5 to post them (a pair of socks!

) plus a default donation you have to opt out of.

Anyway, playingwise we're both on zero points, aren't we?

Nice!

Sweet baby Jesus and the orphans.





Get a copy of the accounts and check the balance sheet which includes a revaluation reserve. Just to spell it out in double-entry bookkeeping terms, the accounting entries go to fixed assets in the balance sheet, and the revaluation reserve, in the balance sheet, but not the P&L account, nor the P&L reserve.