THE CONCRETE ROUNDABOUT (TCR)

Downing - Yet Again. Another Undisclosed Fee. Undisclosed Fee, Should not be allowed. Be Transparent for Feck Sake. How do you explain undisclosed fee to the tax man. Or are they In on It as well. Unbelievable.

When they submit the year end accounts, they only really have to declare total income/expenditure from players sales (including agent's fees, income from sell on clauses/add ons etc) - not individual sales from players.

If we only sold a single player within a financial year, then it would be fairly easy to work out how much we got for them, but any more than that it's just guess work.

I agree though, it would be nice to know how much we get for players, but if we revealed the in's and out's of deals then it would put us as a disadvantage with other clubs who would know how much we were prepared to pay.

At our level, it's safe to say most of our sales/purchases fall between £50k - £250k, with the occasional rare purchase over £250k (Agard).

Agree. It needs to be across the board.

Clubs record different figures for fees in a transfer
That has always been the case. The selling club would record in their accounts how much money they received for transferring the registration. That is fairly clear cut.

But the buying club would often give a far higher figure. And that is understandable. They would price it at the total cost of bringing a player in, not just the transfer fee but also a signing on fee, agents' fees and increasingly in the modern age, image rights payments.

On top of that the buying club have to pay VAT which immediately adds 20% to the price - although that can be later claimed back if the move is domestic or within the EU.

In the past that discrepancy didn’t matter as the fee recorded would be consumed by local media and fans and rarely questioned.

Now the internet and freedom of information means such a routine accountancy device causes confusion and the apparent contradiction raises questions - and unfounded suspicions - and often clubs find it cleaner all round to simply not state a headline figure.

The complexity of transfer fees
One reason clubs don’t announce a cut-and-dried unequivocal figure for a transfer is that such a figure doesn’t exist.

Sometimes deals are so complicated that it is almost impossible to say what the deal will actually cost over the length of the contract.

Yes, there is the ‘transfer fee’ but that could be a fairly low initial figure that doesn’t really represent how much money will eventually change hands.

How much does a £10m transfer actually cost Middlesbrough FC? do the maths

Deals frequently have complex payment structures and bonus elements.

The fee can increase automatically if a player completes two seasons.

It can include elements based on individual performance (goals scored, games played, international call-up dividend) and team performance (promotion, survival, qualifying for Europe) which trigger extra future payments to the selling club.

Gary O'Neil celebrates his goal against Burton
Gary O'Neil celebrates scoring for Boro against Burton
Gary O’Neil was once sidelined on 99 games because one more would trigger an extra £1m to Portsmouth and Boro had to buy out that clause for £250,000.

The buying club may also have hidden unqualifiable future costs. They may have agreed clauses that give the player performance bonuses with goal or game targets, or extra loyalty payments if they complete the length of the deal.

The fee can change depending on currency exchange rates if the player has arrived from abroad, although most clubs will hedge against major fluctuations.

So the figure bandied about in the press when the new boy holds up the shirt may only be a starting point or a projected figure that may or may not be realised so clubs may hare good reason to be coy about it.

Commercial confidentiality
Clubs are complex big money businesses and often they are part of Byzantine corporate structures with many partly or wholly owned abroad in different accounting and tax jurisdictions.

That may allow the wider company certain financial accounting advantages but impose restrictions on what information is made public.

Fans may feel they have “the right to know” but they don’t. Clubs are private and increasingly professionalised businesses. There is no statutory right for customers to see sensitive financial figures.

Bigger clubs are required to make some developments known to the Stock Exchange, but rarely transfer fees.

You can’t hold the manager to account as you could a politician, even they knew the finer details. And you can’t put in a Freedom of Information request. That gives clubs a free hand to operate behind closed doors.

There is an ethical argument to be made that the game should be transparent and all fees - transfer fees and agent payments - should be made public to prevent shady dealings or remove the temptation to cut corners and that the powers that be should take the lead but they lack political will and it wouldn’t stand up in court.

And is not just fans that clubs would prefer to keep in the dark: they don’t want to give their rivals an edge by knowing how much of their budget they are committing to players and how much they have left should they go head to head over a prospective signing.

In a competitive market every little helps.

Market perceptions of a club’s financial muscle
Clubs may not want to reveal exactly what their benchmark fees are in case it encourage other clubs, agents and players to raise their own demands.

If it is known a club has paid, say, £10m for one midfielder then a prospective partner for that player could suddenly have their pricetag nudged up from £7m to £11m.

'Fans shouldn't feel underwhelmed, Boro had a shrewd and successful transfer window'

And it has a knock-on effect: if one mid-ranking team is willing to splash out a new record of £20m for a striker then similar sized clubs with similar sized budgets will be quoted similar prices for similar forwards.

That has always been the nature of the market but the new TV deal has moved fees dramatically upwards and clubs are keen to avoid raising their own particular bar and also to collective dampen the market.

One way of doing that is shrouding prices in mystery. Of course, there will always be ‘media’ fees to set the mark - and clubs willing to break ranks and pay above the going rate - but if fees are not made official it means they can plausibly deny spending such figures.

Protect your public image
Sometimes there are diplomatic reasons to withhold a fee, especially when a club has conducted talks in the glare of publicity.

Spurs made a great play of valuing Sissoko at £16m as they set out their stall as hard-nosed negotiators earlier this week so may be left a bit sheepish if they have to publicly admit they paid almost double that.

Dani Ayala challenges Marouane Fellaini at Old Trafford
Dani Ayala challenges Marouane Fellaini at Old Trafford
Two years ago Manchester United failed to trigger a £23m release clause for Merouane Fellaini and after a few weeks of tense stand-off finally secured him for “an undisclosed fee”.

That would have prevented red-faces had Everton - still smarting from losing David Moyes to Old Trafford - mischievously revealed that they have paid £27.5m.

Thats the explanation ive found after researching it

It's not our business. I'm sure they are open with the taxman.

Why does it bother you? I don't care we have some money for one of our players. Probably undisclosed cause we didn't get a lot and people know how much of a wet one people would have on here.

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It's the hope that kills you

Yeah, I would much rather other clubs are kept in the dark on how much we receive for players.

No-brainer to be honest.

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Decided to come back.

I think Tesco should be forced to say how much they pay for Heinz beans. It's unfair on all the other supermarkets not to share that info. As a Tesco customer, I demand transparency.

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I don't need your ill-informed, half-baked, idiotic opinions. I have plenty of those myself.

I personally don’t care. If I were getting transferred I wouldn’t want people to know how much I am worth.

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The most optimistic pessimistic person on this forum.

Apparently.

UTF

Totally agree. I can't see the point of declaring fees anyway, its the person the fans should be interested in not how much he cost.