Summer Mercato Thread 2018 (58 Viewers)

[Monty]

I'm not a financial experd, but the ammortization thing seems a bit weird to me. It can only be calculated on the basis of his current contract - right? We paid x for him and every year of his contract he depreciates by x until he is out contract?

Say he has a stellar year, we prolong his contract and he lands us 60m next summer. What does that do to his numbers on our books?

How is he going to have that stellar year if he is sitting on the bench and ageing another year ?

 

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[Xperd]

I'm not a financial experd, but the ammortization thing seems a bit weird to me. It can only be calculated on the basis of his current contract - right? We paid x for him and every year of his contract he depreciates by x until he is out contract?

Say he has a stellar year, we prolong his contract and he lands us 60m next summer. What does that do to his numbers on our books?

Who's going to pay €60M for a 32 year old ? Only if he entertains going to the Chinese Super league which is unlikely.

There's just no space for him with Ronaldo here who would do the bulk of the goalscoring. We have 7 forwards. It's pointless to keep them all.

 

[Nzoric]

How is he going to have that stellar year if he is sitting on the bench and ageing another year ?

That is hypothetical - could you just entertain the scenario and answer, if you have the answer that is

 

[Monty]

That is hypothetical - could you just entertain the scenario and answer, if you have the answer that is

Ok hypothetical his asset value on the books right now is 54m

Next year it depreciates to 36m

So if you sell him next year at 60m , its a 24m capital gain for us

 

[Nzoric]

Who's going to pay €60M for a 32 year old ? Only if he entertains going to the Chinese Super league which is unlikely.

There's just no space for him with Ronaldo here who would do the bulk of the goalscoring. We have 7 forwards. It's pointless to keep them all.

That is hypothetical - could you just entertain the scenario and answer, if you have the answer that is

I'm asking about the ammortization - as everyone here is throwing financial terms like they went to financial school. What does prolonging the contract do to the ammortization and residual value? I sure don't know.

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Ok hypothetical his asset value on the books right now is 54m

Next year it depreciates to 36m

So if you sell him next year at 60m , its a 24m capital gain for us

So whether we sell him for 54m now or 36m next year makes no real impact on our books?

 

[Monty]

I'm asking about the ammortization - as everyone here is throwing financial terms like they went to business school. What does prolonging the contract do to the ammortization and residual value? I sure don't know.

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So whether we sell him for 54m now or 36m next year makes no real impact on our books?

Well if you dont sell him for 54m this year and sell him for 36m next year...you still have the 18m amortization expense this year and his wages of 15m

 

[Nzoric]

Well if you dont sell him for 54m this year and sell him for 36m next year...you still have the 18m amortization expense this year and his wages of 15m

Now I'm confused again. Above the difference between selling him for an amount this year and next year is described as a capital gain? I get the wages.

 

[Xperd]

I'm asking about the ammortization - as everyone here is throwing financial terms like they went to business school. What does prolonging the contract do to the ammortization and residual value? I sure don't know.

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So whether we sell him for 54m now or 36m next year makes no real impact on our books?

Why would you want us to prolong his contract in the first place ? He was the highest earner at the club before Ronaldo came here and is getting older. It's not like he's on Mandzukic level wages. Logically and practically speaking, it makes sense to ship him off when we have already bought his direct replacement.

 

[j0ker]

Now I'm confused again. Above the difference between selling him for an amount this year and next year is described as a capital gain? I get the wages.

Yes.

If we sell 56mln this year, or 38mln next years the capital gain will be 2mln in both cases.

 

[Monty]

Now I'm confused again. Above the difference between selling him for an amount this year and next year is described as a capital gain? I get the wages.

I'll start from the beginning

We bought him for 90m, but for accounting purposes we say that its not 90m upfront but 18m each year for 5 years (5*18=90)

Now he has already been here 2 years and we have paid 18m each year so now only 3*18=54m remains to be paid

If we sell him now for 54m, great we dont have to pay any more

If you wait another year, we still have to pay the 18m

And since we have paid another 18m , now we only owe 2*18m = 36m

If next year you sell him for 60m, and since we only owe 36m, its a 24m profit

 

[Roman]

I'm not a financial experd, but the ammortization thing seems a bit weird to me. It can only be calculated on the basis of his current contract - right? We paid x for him and every year of his contract he depreciates by x until he is out contract?

Say he has a stellar year, we prolong his contract and he lands us 60m next summer. What does that do to his numbers on our books?

Agree.
We ALREADY payed those 90M.
Juve are not actually paying the 18M per year...it's just the ammortization value.not actual cash spent.
IT's just how Juve are valuing his minimal price in order to be close to what was spent on him.(18M per year)

Actual spending on him is just his wages.

 

[Xperd]

How football clubs use accounting and amortization

https://www.google.co.in/amp/s/newt...ll-clubs-use-accounting-and-amortization/amp/

Read this.

It's a very simple explanation.

 

[Bianconero_Aus]

The Caldara/Bonucci/Higuain deal nearly complete according to Di Marzio.

 

[Nzoric]

How football clubs use accounting and amortization

https://www.google.co.in/amp/s/newt...ll-clubs-use-accounting-and-amortization/amp/

Read this.

It's a very simple explanation.

K. So there is a chance of actually making money off of keeping him for one more year.

 

[Xperd]

The Caldara/Bonucci/Higuain deal nearly complete according to Di Marzio.

Plusvalenza

 

[Nzoric]

I'll start from the beginning

We bought him for 90m, but for accounting purposes we say that its not 90m upfront but 18m each year for 5 years (5*18=90)

Now he has already been here 2 years and we have paid 18m each year so now only 3*18=54m remains to be paid

If we sell him now for 54m, great we dont have to pay any more

If you wait another year, we still have to pay the 18m

And since we have paid another 18m , now we only owe 2*18m = 36m

If next year you sell him for 60m, and since we only owe 36m, its a 24m profit

Thanks

 

[Osman]

Real had Bale, Rodriguez and Morata for back ups, we can deal with Gonzalo.

Our backup is Higauin, Mandzukic, Cuadrado and Bernadeschi for attack.


Are you kidding? And us keeping Higauin may force us to sacrifice a starter, no?

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[Bianconero_Aus]

Tuz meltdown incoming.

 

[Nzoric]

Our backup is Higauin, Mandzukic, Cuadrado and Bernadeschi for attack.


Are you kidding? And us keeping Higauin may force us to sacrifice a starter, no?

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Or we could find some way to play Gonzalo, Ronaldo, Dybala and Costa together. Allegri is great when it comes to tinkering with stuff like this.

 

[Monty]