SPL club finances - Hearts are a "basket case"

[Lucius Apuleius]

http://sport.scotsman.com/football/SPL-clubs-told-to-sort.6482948.jp

Last paragraph is particularly satisfying:greengrin

[bighairyfaeleith]

Your right, it is particuarly satisfying

[Borders Hibby]

http://sport.scotsman.com/football/SPL-clubs-told-to-sort.6482948.jp

Last paragraph is particularly satisfying:greengrin

That just isnt viable. Now isnt it good that we have a club that doesnt pay huge wages and is financially sound. This policy can be criticised by us at times when we want new players in but hats off to the club for restructuring and ensuring that we have a future.:agree:

[Hibs7]

I prefer this quote from the latest article

"Hearts are the SPL's only true basket case of a club. Their wages-to-turnover figure is an eye-watering 126 per cent, and debt roughly three times their £10m turnover."

Never a truer word said. :thumbsup::greengrin:bye:

[Gatecrasher]

http://sport.scotsman.com/football/Credit-crunch-takes-its-toll.6482938.jp?articlepage=1

[bighairyfaeleith]

typical yam response

A slightly insulting report as far as Hearts are concerned!

Surely we are the 'basket case' only if we were unable to pay the debt? The debt has been borrowed and is due to the same person...Mr Romanov. He is an extremely wealthy man by anyone's standards and is clearly at Tynecastle for the long term. He would have walked by now if he was not staying to see his plan through to the end. We would not still be buying new players and we would not, as we are in the next couple of months, be submitting a new planning consent to the local authority for a new stand .

Makes a good story though and the Scotsman can't resist!!!! Keep lapping it up Hibbies it's all you have got!

109 years in a row!!!!

As for Hibs ? Well yes they don't have any debt. But there big new shiny stand will be at least half empty for the rest of the season and once again no silverware will be ending up at Easter Road.

:greengrin

[Hibs7]

typical yam response

A slightly insulting report as far as Hearts are concerned!

Surely we are the 'basket case' only if we were unable to pay the debt? The debt has been borrowed and is due to the same person...Mr Romanov. He is an extremely wealthy man by anyone's standards and is clearly at Tynecastle for the long term. He would have walked by now if he was not staying to see his plan through to the end. We would not still be buying new players and we would not, as we are in the next couple of months, be submitting a new planning consent to the local authority for a new stand .

Makes a good story though and the Scotsman can't resist!!!! Keep lapping it up Hibbies it's all you have got!

109 years in a row!!!!

As for Hibs ? Well yes they don't have any debt. But there big new shiny stand will be at least half empty for the rest of the season and once again no silverware will be ending up at Easter Road.

:greengrin

New stand aye right... head firmly in the sand ... basket case right enough.

[DCI Gene Hunt]

Ho ho ho! The usual structured, informed, intelligent response I see, with the standard reference to Hibs and the Scottish Cup. :ostrich:

Tynecastle Flats - BELIEVE

Guv

[down-the-slope]

its amazing that the most widely regognised report into football finance is still rubbished by a good percentage of Hearts supporters....:rolleyes:

11% drop in fans at Celtic & Dons stand out for me....how much more would Celtics fall if they were to have a big wobble results wise.....

[DCI Gene Hunt]

Yes, that was quite a shock that. 11% is a worryingly large drop, that said Smelltic did have a ropey end to the season... :violin:

Gene

[Beefster]

FFS, how many times.....

If you owe the money to yourself, it's not debt! It's perfectly simple and completely transparent.

If I borrow £1 from myself for a new pair of y-fronts, I can pay it back to myself whenever I want or even never pay it back. It's not like I'm going to set the bailiffs on myself although I might give myself a quick slap for being so bloody cheeky to me.

[DCI Gene Hunt]

And if Tsar Yam walks away, Herts are fceked. :brokenyam:

Gene

[down-the-slope]

Yes, that was quite a shock that. 11% is a worryingly large drop, that said Smelltic did have a ropey end to the season... :violin:

Gene

Alternative view is that they dropped 11% EVEN with the Robbie Keane factor :dizzy:

[DCI Gene Hunt]

Smelltic didn't win the title, and Rangers finished above them in the table. On both counts in Smellticland that counts as a disaster...

Rats, sinking ship...

[StevieC]

If the Inland Revenue cant get a hold of Hearts finances then how the hell did PWC manage it????

They must have been using figures from 2007, and HMFC have been clearly stating for the last 2 years that wages are back on track and their finances are now the best in the league.

Poor show from PWC and The Scotsman.

:bitchy:

[Hibs Class]

The club will always be able to fool its fans regarding the finances, but if the reports on Driver's contract extension are true then it indicates they still haven't learned their lesson.

[marinello59]

It makes grim reading for the future of Scottish football as a whole. Perhaps the only way out is for every club to adopt the Hearts business model and transfer the debts to themselves. I really don't know how it works and have to admit to being rather sceptical but 400000 hearts fans can't be wrong.:agree:

[Hibs On Tour]

Alternative view is that they dropped 11% EVEN with the Robbie Keane factor :dizzy:

Plus they won their last 8 league games. Would hate to see the drop if they'd been LOSING games!

Rats - sinking ship - figures. PS - the self-proclaimed best fans in the world were at it again at the Emirates... http://www.youtube.com/watch?v=TjdE0b5Jhpk&feature=player_embedded

[ballengeich]

I'm not convinced by the report's conclusion that clubs should be existing by developing and selling young players. It's good news if you do it, but there's a limited supply of youngsters with the potential to be transferred for a large sum, and some with the potential still don't make it to the top.

I'd view that type of transfer as a bonus, not something a club should be relying on to break even, particularly as the difficult economic times we're facing is likely to lead to buying clubs, other than those run as an individual's toy, having less money available than in the past.

[marinello59]

]I'm not convinced by the report's conclusion that clubs should be existing by developing and selling young players.[/B] It's good news if you do it, but there's a limited supply of youngsters with the potential to be transferred for a large sum, and some with the potential still don't make it to the top.

I'd view that type of transfer as a bonus, not something a club should be relying on to break even, particularly as the difficult economic times we're facing is likely to lead to buying clubs, other than those run as an individual's toy, having less money available than in the past.

It's the only way forward. Where else are the large scale sums required to keep standards in our league anywhere near those of other European countries? It won't come from huge media deals that's for sure. It's not just transfers for headline grabbing amounts that will make the difference. Look at how much an English championship side will pay for fairly average players. The alternative is that we stagnate and standards in our league drop even further than they already have.

[DCI Gene Hunt]

It's the only way forward. Where else are the large scale sums required to keep standards in our league anywhere near those of other European countries? It won't come from huge media deals that's for sure. It's not just transfers for headline grabbing amounts that will make the difference. Look at how much an English championship side will pay for fairly average players. The alternative is that we stagnate and standards in our league drop even further than they already have.

Indeed. :agree:

Gene

[jdships]

FFS, how many times.....

If you owe the money to yourself, it's not debt! It's perfectly simple and completely transparent.

If I borrow £1 from myself for a new pair of y-fronts, I can pay it back to myself whenever I want or even never pay it back. It's not like I'm going to set the bailiffs on myself although I might give myself a quick slap for being so bloody cheeky to me.

I see where you are coming from allbeit it being a bit simplistic !
In Hertz case there are large amounts of interest having to be be paid . These payments have to come out of any profit made
It is like having two credit cards which you use to pay the other , monthly , when due .
The capital debt never gets reduced , unless you win money on the Lottery, and the interest accrued increases the debt .
This is OK as long as the person with the cards keeps his job .
In Hertz situation survival is in the hands of one man/bank .
In reality not the ideal business situations

I would probably have no problem with that if they were reducing the debt SIGNIFICANTLY on a regular basis but as it appears they are still in long term "soapy bubble"..
The report says "................but eight out of 12 clubs returned a wage-to-turnover ratio in excess of the recommended 60 per cent, ..........." .
No business regardless how big/small they are can sustain spending at that level - I know from personal experience !!!
Look at the clubs in England who have been appealing against "winding up" orders due to them spending money they didn't have ( VAT/Tax monies were spent to run the clubs.)
Leeds United were probably the outstanding example followed by Portsmout and I wouldn' bet against other's going the same way
The bells rang at ER and that was acted on and the club's future is pretty well secure - spending money doesn't necessarily guarantee success on the field .
The are too many factors that have to be taken into consideration for it to succeed !.

[Caversham Green]

If the Inland Revenue cant get a hold of Hearts finances then how the hell did PWC manage it????

They must have been using figures from 2007, and HMFC have been clearly stating for the last 2 years that wages are back on track and their finances are now the best in the league.

Poor show from PWC and The Scotsman.

:bitchy:

They were using the 2009 figures which were finally published in May - a full 8 months after everyone elses. Interestingly the wages/turnover ratio for 2007 was 121% and 2008 was 123%. That's some track they've got back onto.

[patlowe]

Without knowing any facts or figures, I'd suggest that Hibs' wages to turnover ratio would have creeped up over the past 2/3 years and with the building of the new stand I reckon our finances aren't quite as rosy as is made out on here. Still, we're in a far healthier state than many clubs in the SPL and the recent development of our infrastructure puts us at a healthy advantage.

[LancashireHibby]

That Hertz percentage is comlpetely mental, but they won't heed the warning signs so long as everything is underwritten. It won't last forever, but try telling that to the Yams....

[--------]

It's the only way forward. Where else are the large scale sums required to keep standards in our league anywhere near those of other European countries? It won't come from huge media deals that's for sure. It's not just transfers for headline grabbing amounts that will make the difference. Look at how much an English championship side will pay for fairly average players. The alternative is that we stagnate and standards in our league drop even further than they already have.


Yup. Developing young players to a decent professional standard provides the developing club with a team of home-grown talent, and balances the books when some of those players move on to other, bigger, richer clubs.

It's not about the odd one-off £10 million pound windfall for a star player bailing you out once in a while, it's about a steady income of fees in the £250,000 to £1.5 million band that makes the difference.

And if the development scheme's working properly, every now and again a big fee DOES come along to boost the club.

It's the ONLY way forward for a minor football league like the SPL. :agree:

[Stevie Reid]

Yup. Developing young players to a decent professional standard provides the developing club with a team of home-grown talent, and balances the books when some of those players move on to other, bigger, richer clubs.

It's not about the odd one-off £10 million pound windfall for a star player bailing you out once in a while, it's about a steady income of fees in the £250,000 to £1.5 million band that makes the difference.

And if the development scheme's working properly, every now and again a big fee DOES come along to boost the club.

It's the ONLY way forward for a minor football league like the SPL. :agree:

Definitely - and hopefully now with the stadium complete we can spend a bigger percentage of what we bring in on replacement players.

For example, if we were to sell Stokes at the end of this season for say £1.5M, I'd like to think that we'd be able to spend say £500K on someone like Griffiths from Dundee. Griffiths signs on a 3 year contract at the same/less than Stokesy was on, and we pocket a healthy £1M profit.

After the years of negotiating our way out of the £17M through superb management, hopefully the same style of management will continue mving us forward, leaving all of those too slow/stupid/ignorant to cotton on far, far behind.

Hopefully.

[Part/Time Supporter]

Without knowing any facts or figures, I'd suggest that Hibs' wages to turnover ratio would have creeped up over the past 2/3 years and with the building of the new stand I reckon our finances aren't quite as rosy as is made out on here. Still, we're in a far healthier state than many clubs in the SPL and the recent development of our infrastructure puts us at a healthy advantage.

:agree:

It has gone up from a very low base (42% in 2006/07 IIRC). At that time most folk were moaning like hell because Hibs weren't spending enough.

[Caversham Green]

:agree:

It has gone up from a very low base (42% in 2006/07 IIRC). At that time most folk were moaning like hell because Hibs weren't spending enough.

2006/7 was 41.2%; 07/08 was 57%; 08/09 was 61.5%.

As always though, this only tells part of the story. The 06/07 figure was low because turnover was high - we won the CIS cup and got to the semi of the Scottish. Since then turnover has fallen (08/09 was £2m down from 06/07), so even if we had paid exactly the same wages in 08/09 as we did in 06/07 the ratio would have been higher.

Rather makes a nonsense of the 'recommended' 60% ratio, but one thing's for sure - if the ratio is more than 100% you will make a loss.

[Dashing Bob S]

Smelltic didn't win the title, and Rangers finished above them in the table. On both counts in Smellticland that counts as a disaster...

Rats, treats...

Couldn't resist changing that one for you.

[Gettin' Auld]

Tick Tock Tick Tock...............BOOM!!
:bye:

[Dashing Bob S]

Tick Tock Tick Tock...............BOOM!!
:bye:

I have to admit I find it rather offensive to see the term 'basket case' used so freely by the press, in relation to Hearts finances.





This term, of course, also applies to every other aspect of that odious club.

[Mikey]

I have to admit I find it rather offensive to see the term 'basket case' used so freely by the press, in relation to Hearts finances.



Well you won't see it in that article any more. The paragraphs referring to hearts being a "basket case" have been removed.

Presumably Hearts have been onto the EEN and told them to take that bit out.

[marinello59]

Well you won't see it in that article any more. The paragraph's referring to hearts being a "basket case" have been removed.

Presumably Hearts have been onto the EEN and told them to take that bit out.

Awwwww. Did their feelings get hurt.:boo hoo:

[Phil D. Rolls]

Move along, nothing to see here for at least 109 years etc etc

Fudleys, they remind me of a bunch of lemons jumping off a cliff. (A cain what ah mean son.)

[jgl07]

Well you won't see it in that article any more. The paragraph's referring to hearts being a "basket case" have been removed.

Presumably Hearts have been onto the EEN and told them to take that bit out.
No it's still there:

http://sport.scotsman.com/football/Credit-crunch-takes-its-toll.6482938.jp?articlepage=1

Since then, the Ibrox club- at the behest of their bankers - have hacked away at fixed costs. With two titles and, therefore, two tranches of Champions League money, the club has achieved the twin aim of yearly profitability and debt reduction. Hearts are the SPL's only true basket case of a club. Their wages-to-turnover figure is an eye-watering 126 per cent, and debt roughly three times their £10m turnover.

[Jack]

Not sure if it would have been them that asked for it to be removed. There's a code of practice about references to mental illness and I think that would have crossed the line.

[Phil D. Rolls]

No it's still there:

http://sport.scotsman.com/football/Credit-crunch-takes-its-toll.6482938.jp?articlepage=1

Since then, the Ibrox club- at the behest of their bankers - have hacked away at fixed costs. With two titles and, therefore, two tranches of Champions League money, the club has achieved the twin aim of yearly profitability and debt reduction. Hearts are the SPL's only true basket case of a club. Their wages-to-turnover figure is an eye-watering 126 per cent, and debt roughly three times their £10m turnover.

Turnover, as opposed to profit, at that.

[Kaiser1962]

No it's still there:

http://sport.scotsman.com/football/Credit-crunch-takes-its-toll.6482938.jp?articlepage=1

Since then, the Ibrox club- at the behest of their bankers - have hacked away at fixed costs. With two titles and, therefore, two tranches of Champions League money, the club has achieved the twin aim of yearly profitability and debt reduction. Hearts are the SPL's only true basket case of a club. Their wages-to-turnover figure is an eye-watering 126 per cent, and debt roughly three times their £10m turnover.

Debt, at £35m, is around four times their 8 and a bit million turnover.

[New Corrie]

Tick Tock Tick Tock...............BOOM!!
:bye:


Sorry to piss in your porridge, but you can tick tock all you want, sadly nothing bad is going to happen to them. Vlad is now going into his 6th season and if you look beyond the numbers all isn't to bad, they've won the Scottish Cup, still playing at Tynecastle, been in the Champions League and given us a few tonkings along the way. The reason I say look beyond the numbers is because they don't matter, there is no reward for running clubs efficiently, because all the poorly run ones just pop in and out of administration, bump everyone they are owe money to and plod away as if nothing has happened. Their stadium isn't worth two hoots of a ragmans trumpet, so it isn't going anywhere, and all the debts will never be collected, because there is nothing to collect. All the Hearts, Pompey, Leeds, Livingston etc etc should be out of business, but just like in life away from football, there is no rewards for doing things properly and there is plenty provision in place to help the baddies

[Jones28]

I love it how one poster pointed out that Vlad is at Hearts for the long term and has a plan. What plan?!

The only plan he's got is to cut and run when the bailiffs come a knocking, leaving Hearts up ***** creek without a paddle. Unbelievable.

And then they have the cheek to slag off Easter Road? A world class stadium that is the finest football arena outside of weedgyland.

Do none of these deluded w&nkers see that we are in the best position to move forward and in 5-10 years will be slugging it out with he gruesome twosome for the biggest prizes. New stadium, new training centre, the only debt Hibs carry is long term mortgages on the current stands. Even the new East wont have as big a mortgage as it will have been paid for by transfer money from Fletcher, who has put £4.5 million worth of transfer fee's into Hibs. To have a successful football club which will last for 100 years or more you need to establish a good infrastructure, exactly what Hibs have done.

The rest of the SPL is in a very worrying state. A double dip reccession would leave Hearts, Rangers, Killie and Aberdeen on the edge of liquidation. Even Dundee Utd and Motherwell wouldnt be safe. Scottish football is in a worrying state. Thank f!£* im a hibee :flag:

[jgl07]

Debt, at £35m, is around four times their 8 and a bit million turnover.
You mean it was £35 million a year ago. It is almost certainly topside of £40 million now.

[Caversham Green]

You mean it was £35 million a year ago. It is almost certainly topside of £40 million now.

:agree: Two years after the biggest capital injection and player sales in their history they're virtually no better off than they were before. I can't think of a better description than "basket case".

[Caversham Green]

Sorry to piss in your porridge, but you can tick tock all you want, sadly nothing bad is going to happen to them. Vlad is now going into his 6th season and if you look beyond the numbers all isn't to bad, they've won the Scottish Cup, still playing at Tynecastle, been in the Champions League and given us a few tonkings along the way. The reason I say look beyond the numbers is because they don't matter, there is no reward for running clubs efficiently, because all the poorly run ones just pop in and out of administration, bump everyone they are owe money to and plod away as if nothing has happened. Their stadium isn't worth two hoots of a ragmans trumpet, so it isn't going anywhere, and all the debts will never be collected, because there is nothing to collect. All the Hearts, Pompey, Leeds, Livingston etc etc should be out of business, but just like in life away from football, there is no rewards for doing things properly and there is plenty provision in place to help the baddies

Leeds - dropped to the third tier and struggled to get out.
Pompey - down to the second tier and still falling.
Livi - dropped to the fourth tier and unlikely to reach the top-flight again.

You could add Dundee and Southampton to the list, while Motherwell are the only ones I can think of that have bucked the trend.

Hearts may not go bang, but they look very likely to go pphhhtt and drift gently down the leagues. That's gonna be more fun to watch.

[New Corrie]

Leeds - dropped to the third tier and struggled to get out.
Pompey - down to the second tier and still falling.
Livi - dropped to the fourth tier and unlikely to reach the top-flight again.

You could add Dundee and Southampton to the list, while Motherwell are the only ones I can think of that have bucked the trend.

Hearts may not go bang, but they look very likely to go pphhhtt and drift gently down the leagues. That's gonna be more fun to watch.



Exactly what I was saying, no punishment whatsoever, teams drop divisions all the time without bumping people for millions of pounds. These teams should have been excluded from the league set up and put out of business.

There is no deterrent.

[HibeeB]

Photographic proof that the yams are, indeed, a basket case.......



http://t3.gstatic.com/images?q=tbn:ANd9GcQs79ul9LYTF0VuoWxUOssnUPoUksddv czciJhKAHwsPB9qvUA&t=1&usg=__mAoT3o8E9L5KqDVwKrnZH_zDiYg=

[jgl07]

Leeds - dropped to the third tier and struggled to get out.
Pompey - down to the second tier and still falling.
Livi - dropped to the fourth tier and unlikely to reach the top-flight again.

You could add Dundee and Southampton to the list, while Motherwell are the only ones I can think of that have bucked the trend.

None of the Scottish clubs mentioned had a debt anywhere near the scale of Hearts deficit. Rangers have a much smaller debt and are still in financial trouble even with Champions' League group stage money for two years not even shared with Celtic.

Motherwell cleared a lot of their debts by the sale of McFadden and Pearson and this enabled a CVA to be agreed. They faced a losses for £1.8 to £2.1 million. Hearts have only done better than that once in the last ten years (£1.1 million in 2003).

Hearts have been racking up annual losses between £2.3 million and £12.9 million since then. The losses were £8.6 million last year. This was a season where they finished third in the SPL!

It is highly unlikely that Hearts will go into administration. They will either stumble along or go bust with a very big bang.

[Caversham Green]

Exactly what I was saying, no punishment whatsoever, teams drop divisions all the time without bumping people for millions of pounds. These teams should have been excluded from the league set up and put out of business.

There is no deterrent.

I would agree that in many cases the points deductions are barely enough punishment, although in the case of Leeds and Southampton they were enough to relegate them and with Luton they effectively chucked them out of the league. However, Motherwell aside (and Crystal Palace possibly) the clubs have all taken a serious drop in fortunes - which of course might have happened in any case. Maybe the league authorities should consider the merits of each case individually, but I think closing clubs down is a bit too harsh in most cases. In HOMFC's case of course, the people who would be bumped for millions would be the Romanovs.

[Hibs Class]

Even if they did completely fold, like Airdrie did, the big question would be what would happen to Tynecastle. I'm sure someone would try to buy a smaller league club, rename them Hearts and try to relocate them to Edinburgh. That's what Airdrie did when they bought Clydebank and relocated them to Airdrie and reamed them Airdrie Utd. But if Tynecastle was sold then that would be a problem for them.

[ahibby]

Sorry to piss in your porridge, but you can tick tock all you want, sadly nothing bad is going to happen to them. Vlad is now going into his 6th season and if you look beyond the numbers all isn't to bad, they've won the Scottish Cup, still playing at Tynecastle, been in the Champions League and given us a few tonkings along the way. The reason I say look beyond the numbers is because they don't matter, there is no reward for running clubs efficiently, because all the poorly run ones just pop in and out of administration, bump everyone they are owe money to and plod away as if nothing has happened. Their stadium isn't worth two hoots of a ragmans trumpet, so it isn't going anywhere, and all the debts will never be collected, because there is nothing to collect. All the Hearts, Pompey, Leeds, Livingston etc etc should be out of business, but just like in life away from football, there is no rewards for doing things properly and there is plenty provision in place to help the baddies
:top marks

[Dashing Bob S]

I would agree that in many cases the points deductions are barely enough punishment, although in the case of Leeds and Southampton they were enough to relegate them and with Luton they effectively chucked them out of the league. However, Motherwell aside (and Crystal Palace possibly) the clubs have all taken a serious drop in fortunes - which of course might have happened in any case. Maybe the league authorities should consider the merits of each case individually, but I think closing clubs down is a bit too harsh in most cases. In HOMFC's case of course, the people who would be bumped for millions would be the Romanovs.

Closing down clubs merely punishes the fans, rather than the maggots who've ruined the club. (Though in the case of Hearts I'm strangely happy for the fans to be caught in the crossfire.)

I agree with Corrie though, the punishments for running a club badly don't seem so severe. Bigger clubs can restructure and work their way back through the leagues fairly easily. Far better would be to expunge Pompey's and the Yams cup wins from the record books.

Funnily enough, I think the Yams will probably go belly-up at the wrong time, when the authorities are more determined to make an example of clubs. Had they gone to the wall when we first started suggesting/hoping they would, they'd probably be back in the SPL by now anyway.

[Caversham Green]

None of the Scottish clubs mentioned had a debt anywhere near the scale of Hearts deficit. Rangers have a much smaller debt and are still in financial trouble even with Champions' League group stage money for two years not even shared with Celtic.

Motherwell cleared a lot of their debts by the sale of McFadden and Pearson and this enabled a CVA to be agreed. They faced a losses for £1.8 to £2.1 million. Hearts have only done better than that once in the last ten years (£1.1 million in 2003).

Hearts have been racking up annual losses between £2.3 million and £12.9 million since then. The losses were £8.6 million last year. This was a season where they finished third in the SPL!

It is highly unlikely that Hearts will go into administration. They will either stumble along or go bust with a very big bang.

I think Hearts would only go bust if Vlad's empire collapsed - which is by no means impossible. They do have to cut their costs dramatically though. The season before last they made a loss even before staff costs were taken into account while last season their wages budget would have had to be lower than Falkirk's just to break even - and that would have made no impression on their debt. They still have that problem even if Vlad writes off all of their debts tomorrow, so I think they are likely to start fizzling out as a force in football because it's the only way they can survive. Indeed that process seems to have already started.

I do wonder how safe Rangers are as well. The Murray group seems unable to support them and is in serious trouble itself. A much larger part of their debt is owed to HMRC, who seem to be itching to put a football club out of business. Their debt would be enough to object to a CVA, so RFC wouldn't be able to exit administration. They are in a better position to trade their way out of debt, but it still seems to be touch and go.

[jgl07]

Even if they did completely fold, like Airdrie did, the big question would be what would happen to Tynecastle. I'm sure someone would try to buy a smaller league club, rename them Hearts and try to relocate them to Edinburgh. That's what Airdrie did when they bought Clydebank and relocated them to Airdrie and reamed them Airdrie Utd. But if Tynecastle was sold then that would be a problem for them.
Two options.

One would be to buy East Stirlingshire, who currently do not have a ground and relocated them either to Livington or maybe to Spartans new ground renaming them Rim of Midlothian. Even if only a proportion of the Hearts' 400,000 transfer allegiances they would surely generate enough cash to rise through the Leagues and be back in the SPL within four to five years.

The other option is to form a new club and apply for the vacant place in Division Three. After that the same scenario would apply

Either way there would be a problem of obtaining a new ground then (or if) they make it back towards the SPL. Maybe the Meadowbank replacement could be fitted with enough seats to accommodate 400,000?

[New Corrie]

I would agree that in many cases the points deductions are barely enough punishment, although in the case of Leeds and Southampton they were enough to relegate them and with Luton they effectively chucked them out of the league. However, Motherwell aside (and Crystal Palace possibly) the clubs have all taken a serious drop in fortunes - which of course might have happened in any case. Maybe the league authorities should consider the merits of each case individually, but I think closing clubs down is a bit too harsh in most cases. In HOMFC's case of course, the people who would be bumped for millions would be the Romanovs.



Aslong as that attitude is adopted there will remain no incentive for clubs to operate within their means. The threat of exclusion might just get them reigned in, then the properly run clubs like Hibs might start reaping rewards for their prudent operation.

[Caversham Green]

Aslong as that attitude is adopted there will remain no incentive for clubs to operate within their means. The threat of exclusion might just get them reigned in, then the properly run clubs like Hibs might start reaping rewards for their prudent operation.

As DBS says though, closing the club down punishes the fans - as does relegation or even points deductions. Maybe a system of budgetary control with transfer embargoes and the forced sale of high earners where a club overruns a break even budget is the way to go. Certainly I feel the 'fit and proper person' tests are nowhere near strict enough.

[Jack]

0.1 point deduction for each percentage point the debt is to turnover. So if a club has a turnover of £10m and a debt of £10m then 10 points are deducted. A debt of say £36m would mean 36 points are deducted :devil: – or something like that.

Audited accounts, if no audited accounts are made available within a reasonable time, to be decided, then 50% of the champions of the previous year total is deducted until such time as they are. If none are received by the end of the season the club is relegated.

[Ray_]

As DBS says though, closing the club down punishes the fans - as does relegation or even points deductions. Maybe a system of budgetary control with transfer embargoes and the forced sale of high earners where a club overruns a break even budget is the way to go. Certainly I feel the 'fit and proper person' tests are nowhere near strict enough.

Maybe relegation would punish the fans, however, when the same fans crow, as much as our neighbours do, about artificial high league places & cup wins, then perhaps they are deserving of that punishment.

[Dr Jimmy]

Maybe relegation would punish the fans, however, when the same fans crow, as much as our neighbours do, about artificial high league places & cup wins, then perhaps they are deserving of that punishment.

:top marks I think in most cases the fans deserve to be punished. They should feel the pain of their clubs fall from grace as much as the owners, as these are the parties that have benefited from the over spend.
Meanwhile on planet prudent, decent clubs like our have very little success despite playing by the rules.

[New Corrie]

As DBS says though, closing the club down punishes the fans - as does relegation or even points deductions. Maybe a system of budgetary control with transfer embargoes and the forced sale of high earners where a club overruns a break even budget is the way to go. Certainly I feel the 'fit and proper person' tests are nowhere near strict enough.

All the more reason for doing it I would have thought.

[ScottB]

It's crazy that that thread is full of Yams saying these reports are nonsense / biased / part of the great Hobo conspiracy etc etc as if this accountancy firm has some axe to grind. Total head in the sand stuff I guess.

That they all seem to think that since 08 / 09 they've gutted their wage bill and returned to profit. Utter nonsense, they still had huddies like Nade plus Goncalves and co up until the end of last season all on £10k a week plus, as well as adding Ian Black on a high wage. Perhaps this season their wage bill will be a bit lower having shed some top earners, but then Barr, Kyle and Elliot are presumably all on £5k a week plus, so I can't see how their wage bill could have dipped beneath turnover, particularly if they go ahead and offer Driver a contract in the £12k - £20k range.

They are still spending ridiculous amounts of money on players. If we assume that the Hearts fans on the whole don't have a problem with this reckless spending / it's all from the bank we own type crap, surely they should be questioning their generally pitiful performances, one second place and one cup aside, they have hardly consistently outperformed the teams around them.


What will happen to them long term is a good question, of course in the mean time, Vlad's banking group is feasting off of Hearts interest payments and presumably now has Tynecastle as an asset should the house of cards ever come crashing down. I can't see them going into administration as I doubt Vlad would want anyone trying to pick through the web of deals and transactions that are no doubt going on there. They'll stagger on as long as they can pay interest on their loans or his tinpot bank can afford it, once that stops I would imagine he'll simply liquidate his shareholding and sell off the assets his bank owns (be interesting to see if, for example, Driver is actually contracted to Hearts or some other company / team) leaving nothing much other than the rights to a name kicking about. Brutal, but I don't see another end. Vlad isn't a fool, I'm sure he knows exactly what he's doing.


The crunch time will be what happens when league reconstruction is announced, can see several teams taking that as an opportunity to go into administration, that's probably Hearts last chance of avoiding destruction...

[Caversham Green]

All the more reason for doing it I would have thought.

I guess that's where we differ. I'm all for certain fans being brought down a peg or two as Ray-in-Ireland suggests, but I would have a great deal of sympathy with the diehard fans that make up the core of support of most clubs if their club went out of business. We Hibees know how it feels when the existence of your club is threatened and I wouldn't wish that on the real supporters of any club - even Hearts.

It is going to happen to someone though, and it probably needs to in reality.

[Kaiser1962]

Aslong as that attitude is adopted there will remain no incentive for clubs to operate within their means. The threat of exclusion might just get them reigned in, then the properly run clubs like Hibs might start reaping rewards for their prudent operation.

I agree that the punishment dosent fit the crime. Last season Kilmarnock were, to all intents and purposes, rewarded for running an inefficient and overspending company by not being relegated whilst Falkirk were punished by relegation for living within their means. It hardly seams fair.
And Hibs have repaid the best part of £20m over the last 10 years and, if other clubs dont and take the admin route to dump their debt, you have to ask for what?

And no, sorry, I dont know the answer.:cool2:

[Bostonhibby]

I have to admit I find it rather offensive to see the term 'basket case' used so freely by the press, in relation to Hearts finances.





This term, of course, also applies to every other aspect of that odious club.

:agree: some of my best friends are basket cases, and it just seems so unfair to lump them in with this shabby gathering of single celled amoeba...................

[whelehan]

is csaba not due to face them in court next week? if he doesnt get bought off at the front steps of the court then he might open a can of worms regarding the finances and going ons of our neighbours ?

[Bostonhibby]

is csaba not due to face them in court next week? if he doesnt get bought off at the front steps of the court then he might open a can of worms regarding the finances and going ons of our neighbours ?

Not sure I can say he is going to appear in open court, but most of my professional life has been spent in the grey area between what should get to court, and what doesn't and trust me on this, whether it is the guy who is waiting to be paid for supplying the pie(or more than 1 pie as there is 400,000 of them) or HMRC, all the best dodgy businesses only EVER pay up on a loser at the door step, Shabby deserves credit for the laughs he gave us and having the balls to follow this through, he will be HANDSOMELY compensated as he is on good legal ground and has some great stories to tell, which like his predecessors he will never tell as for the few with the nerve to pursue the litigation to the end and look like they meant it Vlads advisers will settle this one generously outside court and therefore outside the public eye at the very last minute with a confidentiality agreement, either that or kill him. :wink:

[Hibercelona]

Sorry to piss in your porridge, but you can tick tock all you want, sadly nothing bad is going to happen to them. Vlad is now going into his 6th season and if you look beyond the numbers all isn't to bad, they've won the Scottish Cup, still playing at Tynecastle, been in the Champions League and given us a few tonkings along the way. The reason I say look beyond the numbers is because they don't matter, there is no reward for running clubs efficiently, because all the poorly run ones just pop in and out of administration, bump everyone they are owe money to and plod away as if nothing has happened. Their stadium isn't worth two hoots of a ragmans trumpet, so it isn't going anywhere, and all the debts will never be collected, because there is nothing to collect. All the Hearts, Pompey, Leeds, Livingston etc etc should be out of business, but just like in life away from football, there is no rewards for doing things properly and there is plenty provision in place to help the baddies

Exactly.

Teams that are ran poorly are better off than teams that do things right.

Hearts will go into Administration eventually, but so what? They will be back in the SPL again after a few seasons with a totally clean slate. :grr:

[Bostonhibby]

Exactly.

Teams that are ran poorly are better off than teams that do things right.

Hearts will go into Administration eventually, but so what? They will be back in the SPL again after a few seasons with a totally clean slate. :grr:

always been that way for dodgy businesses that quickly reinvent themselves, some years ago where pride and reputation had something to do with it, it used to be double glazing companies, dubious investment scams etc, that did it this way, I remember Middlesborough doing it in the late 80's (?) sadly its becoming more and more the norm in society generally that you run up a debt and use the law to avoid it, if its not truly secured the smarter chancers know how to emerge from it relatively unscathed financially, the establishment team are likely to do this and justify it to themselves after the event, its just about who owns the only assett thats left and what they want to do with it.

[Hibercelona]

always been that way for dodgy businesses that quickly reinvent themselves, some years ago where pride and reputation had something to do with it, it used to be double glazing companies, dubious investment scams etc, that did it this way, I remember Middlesborough doing it in the late 80's (?) sadly its becoming more and more the norm in society generally that you run up a debt and use the law to avoid it, if its not truly secured the smarter chancers know how to emerge from it relatively unscathed financially, the establishment team are likely to do this and justify it to themselves after the event, its just about who owns the only assett thats left and what they want to do with it.

In this case, the law may as well legalize robbery all together. :grr:

An absolute joke of a system.

Makes me wonder why we bother to do things right sometimes.

[ScottB]

In this case, the law may as well legalize robbery all together. :grr:

An absolute joke of a system.

Makes me wonder why we bother to do things right sometimes.

Because in the case of Hearts at least, they will be lucky to still retain the rights to their own name never mind the stadium or any physical assets...

[Phil D. Rolls]

Not being funny, but when we went close to bankruptcy, were there not people that Hibs owed money to? If so, were they paid in full, or did we act like the clubs we are slagging off now?

I agree that it is unfair that teams have bought themselves cups and league position with no intention of paying up. It's just that I think we could have the same accusation made against us.

I hope I am wrong.

[MrSmith]

Not being funny, but when we went close to bankruptcy, were there not people that Hibs owed money to? If so, were they paid in full, or did we act like the clubs we are slagging off now?

I agree that it is unfair that teams have bought themselves cups and league position with no intention of paying up. It's just that I think we could have the same accusation made against us.

I hope I am wrong.

From my recollection of that, our debt accrued due to a chain of pubs bought in England by Mr Duff. When STF took us over he ensured the pub chain was sold and all outstanding debt was paid. If I remember correctly the irony was that the pub chain began making a profit as they where being sold.

Can't be sure but I do know that Sir Tom ensured the club acted with integrity and dignity throughout the administration.

[Kaiser1962]

From my recollection of that, our debt accrued due to a chain of pubs bought in England by Mr Duff. When STF took us over he ensured the pub chain was sold and all outstanding debt was paid. If I remember correctly the irony was that the pub chain began making a profit as they where being sold.

Can't be sure but I do know that Sir Tom ensured the club acted with integrity and dignity throughout the administration.

I recall that the Club, briefly, went into recievership shortly after the Farmer/Mercer battle for shares ended with Mercer admitting defeat. This was, to a degree, engineered by Farmer as he was unable to persuade a certain Spotty Rowland (now of the Conservative Party) to sell him his shareholding. Rowland was eagerly selling his shareholding to Mercer but wouldnt relinquish it to Farmer. The brief spell in receivership persuaded Rowland to leave the company and Farmer to assume total, or near total, control. In order to gain this control Farmer undertook to honour all debts personally although, as it turned out, this guarantee was never called upon and the club managed to ensure everybody got paid and the rest, as they say, is history.

This is how wee team's operate.

[MrSmith]

I recall that the Club, briefly, went into recievership shortly after the Farmer/Mercer battle for shares ended with Mercer admitting defeat. This was, to a degree, engineered by Farmer as he was unable to persuade a certain Spotty Rowland (now of the Conservative Party) to sell him his shareholding. Rowland was eagerly selling his shareholding to Mercer but wouldnt relinquish it to Farmer. The brief spell in receivership persuaded Rowland to leave the company and Farmer to assume total, or near total, control. In order to gain this control Farmer undertook to honour all debts personally although, as it turned out, this guarantee was never called upon and the club managed to ensure everybody got paid and the rest, as they say, is history.

This is how wee team's operate.

Hey Mark,

as eloquently put as ever.

and, absolutely spot on.

[Hibs On Tour]

As DBS says though, closing the club down punishes the fans - as does relegation or even points deductions. Maybe a system of budgetary control with transfer embargoes and the forced sale of high earners where a club overruns a break even budget is the way to go. Certainly I feel the 'fit and proper person' tests are nowhere near strict enough.

Pretty sure the most direct consequences against those actually responsible would be the laws regarding company behaviour - not trying to trade when you know you're insolvent etc. Dunno what the penalties are but they'd likely be reasonably severe against the directors of a company - depends how the football clubs are set up though I suppose.

I also think I see what you mean about fans being punished if a club gets shut down and I agree with it to a point but there are also only a tiny minority of fans of these clubs who rail against it at the time. Witness a pal of mine who is a jambo - whenever we have these arguements I point out that they will go 'pop' sometime and he says 'I know' and agrees that Vlad is a tit - he then counters with 'but I've seen my club lift the Scottish Cup twice in my lifetime' and its something that regardless of all the financial arguements and truths, that I don't have a counter for. Ask most fans of any club and they would take their day of glory in the sunshine and to hell with the consequences. Primarily because they realise they'll either not really be any consequences or if there are they will just be a temporary thing before they're back where they were again.

Until the football authorities implement proper financial controls over clubs instead of just making empty statements, nothing will change and clubs like Hearts will have an advantage over clubs like us.

[Hibs On Tour]

Another example of clubs using administration as a temporary get out before starting off the same way again...

Edgar Davids to Crystal Palace!

http://news.bbc.co.uk/sport1/hi/football/teams/c/crystal_palace/8929525.stm