Just had a read of fielden’s tweets - rather disappointingly he just comes across as a bit thick and hides behind ‘someone told me something’
If anyone remembers, there were some ferocious debates about amortisation back on the old Molineux Mix, when it was first introduced as the accounting standard for football clubs. Its always been a difficult issue to grasp, imo, as it allows for some presentational trickery by club CEOs when they want to present the board's spending in as positive light as possible. This applies to a lot of clubs, and not just Moxey's time at Wolves. So the actual books will present transfer fees amortised over the length of the player's contract, while publicly the transfer fee will be presented as one off payment in a particular season, or close season.
There's a sound logic, of course, that amortising a player's fee is a superior way of presenting a club's finances, and not just an accounting manoeuvre to get around spending caps. Football clubs, as businesses, develop and succeed over a period of years, and investments need time to bear fruit. FFP is designed to simply set a limit factor on the degree of risk in investment, and has been calibrated and recalibrated several times after discussion to better reflect the competitive realities of the various leagues. The Championship is the most contentious both because of the extravagant rewards for success and the growing advantage granted by parachute payments to relegated clubs, (which, nevertheless, remain highly elusive to realise). The constant inflation of transfer fees, itself generated by the constant growth of broadcasting incomes for the Premier League, means, however, that even the new fairly loose limits of 39 million losses over three years already looks to be lagging behind the new normal.
I generally agree with DW's take on all this: Fosun are highlyh sophisticated operators who fully understand the environment they are working in. Buying young saleable assets is the best way to copperbottom the risk factor in their spending. It was also noteable this summer that they chose to loan out Iorfa rather than sell him, as his value may well significantly increase if he has a storming season at Ipswich. This looks like a decision made directly with FFP in mind. Likewise with the extensive use of the loan market.
Costa's injury does, however, underline how even the best laid plans may be undermined. Without tracking the levels of spending too closely, as we dont yet have the figures at our disposal, it may well be that Wolves will need at least one big sale next summer to comply with FFP the following season if we are not promoted this year. That one big sale could have been Costa moving onto the bigger stage he deserves and everyone could feel happy. But a year where he cant shake off a persistent ankle injury, one of the most difficult to clear up for a pro footballer, and his transfer value will shrink to probably less than we paid for him. So risk can only be managed, never eliminated.
I wouldnt underestimate the malicious character of the discussion about Fosun's spending, which will only worsen if we are successful. Wolves are not plucky Bournemouth, or even, for that matter, Lineker cosy Leicester. When we are not being patronised, we are, for whatever reason, quite disliked.
