21 Apr 2012

LFC transfer fees: Top 10 *myths*, including Alonso, Keane and Aquilani...

Given the confidential nature of player contracts, real transfer fee levels are rarely released into the public domain. This leads to guesswork and supposition on a grand scale, which then leads inaccurate figures floating around. Here are the some of the glaring inaccuracies currently accepted as gospel.

The incorrect figures quoted here have been compiled from several LFC sites. The correct figures come from the club's official accounts.

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MYTH 1: Xabi Alonso (£10.7m), Luis Garcia (£6m) + Antonio Nunez (£1.5m) bought for £18.2m

Reality: Combined cost = £13m.

Xabi Alonso transfer fee

MYTH 2: Xabi Alonso sold for £30m
Reality: Sale fee = £24.3m (£29.7m minus fees for Voronin + Dossena)

xabi alonso transfer fee

MYTH 3: Jan Kromkamp was free as part of a player exchange with Josemi
Reality: Kromkamp cost £4.3m.

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MYTH 4: Alberto Aquilani's transfer fee was to be paid in installments.
Reality: The full amount was paid at the time of purchase.

xabi alonso transfer fee

It's true that Roma posted a breakdown on their website of how Aquilani's fee was to be paid in installments (now removed), but as the accounts clearly show, that arrangement changed at some point and the full fee was paid up front.

MYTH 5: Gabriel Paletta was sold for £1.2m.

Reality: Actually sold for £500k *but* the club made a £1.5m loss on the sale as a result of a £2m impairment charge.

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MYTH 6: Albert Riera cost £8m
Reality: He cost less than £7m

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MYTH 7: Liverpool sold Robbie Keane for £16m
Reality: The club made an £8m loss (at least)

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Here is further proof that the club made a loss on Keane:

Keane fee

MYTH 8: Andrea Dossena sold for £4.7m
Reality: Actual sale fee was 4.2m Euros, which is £3.5m (approx)

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LFC.tv is owned by Liverpool FC, and its figures come directly from those in the know at the club. It is obviously a trustworthy source.

MYTH 9: Dirk Kuyt cost £9m
Reality: He cost £10m

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MYTH 10: Patrice Luzi was a free transfer
Reality: He cost a couple of million (approx)

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Most sites report Salif Diao's transfer fee as anywhere between £4.5-£5m (LFChistory has it at £4.7m). If those figures are correct, then Luzi cost between £1-£2m.

MYTH 11: Kirkland, Traore, Barragan, Mellor and Kromkamp were sold for a combined £8.4m.

Reality: The Club received a pitiful £4.5m for the lot, ahich represents quite a significant loss on the original combined outlay.

Mellor Kromkamp transfer fees

NOTES

1. According to Deloitte, under accounting requirements, the cost of acquiring a player’s registration includes:

* The transfer fee payable

* Any probable contingent amounts (i.e. Fees that may become payable/receivable in the future depending on certain conditions being fulfilled)

* Other direct costs such as transfer fee levy and fees to agents.

The club's accounting policies adhere to these guidelines.

2. Acquiring a player's registration = paying money to buy a player.

3. Signing-on fees are not included in the transfer fee figure. They are accounted for entirely separately:

4. Some items are on post balance sheet events because they took place after the accounting period deadline of 31 July. Thus, they will not be on the balance sheet. This is standard practice, and doesn't make any difference to the validity of the figures.

Jaimie Kanwar


33 comments:

  1. Another rafa bashing surprise there no mention of surez

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  2. and.........?
    Every club in the premiership will have transfer accounts like this. Tell us something we don't know (or suspect).

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  3. I'm sure there we're clauses such as fees paid for certain amount of appearances etc.

    But it does show how lots of fans take things at face value

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  4. Liverpool have done some terrible business over the years. But im not sure im bothered now. As nesv paid a set price I dont think the previous dealings matter anymore.

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  5. So what? This is all very much past history.

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  6. that money for kronkamp is one of the worst deals ever.
    he was awful.i remeber rafa started him ahead of finnan for awhile.
    really interesting article.

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  7. And the point of all this?

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  8. it's debunking transfer myths.
    it's not that difficult to grasp.
    i think most people will actually find it interesting.

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  9. Actually the differences in the figures quoted in the main part are really inconsequential.  Whether its a couple of hundred thousands, or in the worst case, a £6m difference between 'myth' and supposed contradictory evidence its immaterial.  Most of the fees these days are 'undisclosed' or surrounded by ambiquity.  Henderson is quoted in various publications at being between £14-£20m.  Did Torres cost £19m or £26m, as is reported by a multiple of sources?  When you lump in several players in a combined cost its makes any sort of point trying to be made, mute.  We all know that theres a myriad of elements to every deal, between agents fees, bonus payments, and then throughout the length of the deal theres also the write down or depreciation on a contract which change the accounting effect of a sale rather than the absolute of monies received.  Either way, I stand over my initial comment...whats the point?

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  10. isaac your a prick

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  11. I work for Deloitte (not in the football division) and I don't believe that contingent amounts are included.  Contingent assets and liabilities are not usually recorded and are listed in the notes.  This is the usual practice.  

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  12. "Under accounting requirements, the cost of acquiring a player’s registration includes the transfer fee payable (including any probable contingent amounts), plus other direct costs such as transfer fee levy and fees to agents".

    That quote is taken directly from Deloitte's own documentation, which is viewable here:
    http://www.deloitte.com/view/en_IE/ie/news/9af3c5275d0fb110VgnVCM100000ba42f00aRCRD.htm

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  13. Wow  Kanwar you REALLY need to get a girlfriend.

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  14. Ah...I see my reply comment to Titi must have been unwelcomed and so apparently has been removed.

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  15. Old news not relevent to the current owners, although it would have been interesting to see the wage breakdown ie money saved by selling players on. Still makes interesting reading tho

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  16. Would be good to find out about Henderson. As Comoli once said no published figures are close to accurate so far.

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  17. Another waste of 5 minutes of my life reading this pointless "article".

    I hope everyone starts to see this site for what it really is - run by a person who puts up articles with sensationalist headlines to stir people up, resulting in plenty of traffic and a nice little earner.

    You seem to be a very unpleasant man; and I have little doubt that many of the things I have read about you are true.

    And before you tell me not to come back - I have removed the site from my newsnow preferences, and won't waste any more of my time on this odious, negative and abrasive site.

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  18. I'd noticed that already Billy Boy. How do you do that with newsnow though?

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  19. Interesting,  must have to do with the definition of probable.  In this case it must mean almost definite, where as in other cases it can mean more than 50%.  As I said, usually contingencies are in the notes.  I'm not sure where the players registration costs are recorded in the financial statements.  

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  20. I believe that we gave someone our magic beans for him.  This cant be verified though.

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  21. Finally you produce something useful kanwar!

    Instead of stats justifying hodgsons reign and poulsen's sideways passing , this is worthwhile.

    Useless copy and pastes, and hypothetical questions where you slated the respondents - what were you on??

    Bravo kanwar....there's hope for you yet.

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  22. I don't know any business that actually records the true figures in their accounts. Lots of figures are massaged for lots of different reasons, corporation tax being the usual culprit. But with so many clauses in players contracts, agent fees and lots of other anomalies the figures quoted in company accounts will never be the true amounts.  Big businesses don't employ accountants to record the true figures they employ them to hide the true figures.

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  23. I love when you do articles like this Jaimie. Brilliant. Can't get this stuff anywhere else on the net (well, you can I suppose!).

    It interests me what Deloitte's definition of probable is.

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  24. Septimus_severus8:35 am, April 22, 2012

    Well Done JAIMIE!

    This is the kind of stuff that shows what'd been done in the past very interesting.

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  25. regarding Aquilani, the full transfer amount is listed in the post balance sheet events but that does not mean it was not paid in installments. Accounting practice is to place the amounts outstanding in creditors and release it to the P&L when the obligation to pay becomes unconditional. Its in SSAP 9 or FRS 12 if you want to look it up

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  26. You really need to get laid !

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  27. no offence jamie but you used to come out with all this info to prove Tom  and George wernt loading the club with debt and that they were 'great' owners. You were left with egg on your face then eh, maybe some of your current readers are unaware of your steadfast backing of the cowboys that ran the club into the ground?? 

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  28. Jaimie -the contingent amounts suggest that transfers based on installment payments, are still accounted for in the whole amount, in the purchasing year.  i.e. the balance sheet report on Aquilani doesn't mean that he wasn't purchased in installments.  

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  29. That is why independent auditors are used.

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  30. Why i said Rafa and lfc in general have no business sense at all. Run by complete idiots period!!

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  31. Who actually cares? Rafa just wanted a massive squad and liked to buy and sell sometimes before players had a proper chance. Dalglish gives players chance after chance to no obvious effect. Mind you, Henderson nearly had a shot on target today so that's an improvement.

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  32. So, the bad business that we have been notorious in carrying out over the years is actually worse than we originally thought?

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