Money, Money Money – Arsenal Have Millions to Spend
What is the truth about Arsenal’s finances? Does Wenger have money to spend or has the move to the Emirates crippled Arsenal? These are questions that we are left asking every week as we speculate what money we have to spend.
Arsene and the board go on about UEFA’s Financial Fair Play (FPP) as justification for not splashing out on players, fearful that we will not be admitted into UEFA competitions, at this rate we will be luck to qualify!
UEFAs FPP regulations stipulate that over a three year period a club can only show football related losses of €45M. These losses do not include interest on loans associated with stadium or training ground development.
Furthermore, when a club sings a new player, i.e. Gervinho for £10.6M on a 4 year contract, this £10.6M is charged to the clubs accounts over four years, so Arsenal will record £2.65M to the accounts for the next 4 years. If a player is sold his original signing fee has been written off, i.e. Clichy £7M, then the club claims credit for the whole amount in the year the player is sold. This means that as far as player trading is concerned for the accounts 2011/12, Arsenal are showing a profit of £4.35M.
So spending money today is spread over the life of a player’s contract. Purchasing Cahill for £17 M and giving him a 5 year contract means we only account for £3.4M a year. So Wenger’s argument that any lavish spending (or in our case any spending) will harm our position is respect in UEFAS FPP is rubbish.
The next point is do we have money at the bank? The answer is yes, we have it by the bucket load. The last set of accounts for the 6 months ending November showed we had £110M in the bank. This remember is for a period when we still have not received all the television money nor all the prize money. Whilst we need to keep £22M in the bank to meet interest repayments, this still leaves us with £88M to spend. Since November we have sold more flats at Highbury Square and also sold to Barratts the Queensland Road flat development for around £26M. Cash is not a problem.
Arsenal have plenty of cash, cash that other clubs are envious of, the UEFA FPP regulations are workable, so there is no excuse from Wenger or the board as to why we do not spend money this summer.