Bradford rent: what could happen to us in the future?

[Cricko]

I believe it happens, because of stories I have heard news articles I have seen , but I personally have never had any balance sheet item pointed out to me as being a cover for "creative accounting" or seen a set of accounts which was later proved to be "creative" so I honestly can't prove or disprove it in this instance, I am nowhere near the level of a forensic accountant I am afraid.....

Sorry I did not mean to put you on the spot there..I can tell you 100% it happens every day of the week, in fact that is half the reasons companies employ top accountants, to save them monies and to make things look Kosher on paper. If you are gullible enough (which I don't think you are) to believe every figure you are given is 100% fact I am amazed you are so naive...No disrespect meant mate.

 

[Firestorm]

Sorry I did not mean to put you on the spot there..I can tell you 100% it happens every day of the week, in fact that is half the reasons companies employ top accountants, to save them monies and to make things look Kosher on paper. If you are gullible enough (which I don't think you are) to believe every figure you are given is 100% fact I am amazed you are so naive...No disrespect meant mate.

No offence taken John, I can only comment on the facts as can see (which may well explain why I am not a foresnic accouintant)
I will have to go and do a bit of research on creative accounting as my original understanding of it was that it was basically an artificial inflation of the asset value in order to allow for increased borrowiing against the assets. Either for personal gain or to disguise a loss making venture.

Actually i have seen a set of accounts which may have contained the above scenario, the SUFC accounts for the mid 90's included a couple of large increases in asset value in what i feel was an attempt to make the club more attractive to a buyer

 

[Cricko]

http://en.wikipedia.org/wiki/Creative_accounting

"They are characterized by excessive complication and the use of novel ways of characterizing income, assets, or liabilities and the intent to influence readers towards the interpretations desired by the authors. The terms "innovative" or "aggressive" are also sometimes used.

http://www.amazon.com/Unaccountable-Accounting-Games-Accountants-Play/dp/0060104716

"I remember this interesting book from the 1970s. It begins with a corporate president interviewing three auditing firm representatives. The president asks, "How much is two plus two?"

#1 replies, "It's four."
#2 replies, "It ranges from three to five."
#3 replies, "What do you want it to be?"

 

[londonblue]

I believe Ron acquired the club for nothing

RHL and SEL were then set up (50% Martin Dawn 50% Delancey)

RHL and SEL then bought the assets of SUFC

MD then paid Delancey then for their 50% of SEL & RHL and the additional money they had put in .

Plus 20% if I remember correctly.

 

[Wise Head]

If the club was ever shafted, it was back then. I was as vociferous then as anyone is now, but the trouble with selling from a position of weakness is that you never get good value, although with the rent RM has written off and the costs incurred you have to wonder who got the best end of the deal.

Our destiny has been out of our hands for a very long time.

I agree & was unhappy at the time. My main issue is that the money should have been injected into the football club who then retained the assets. If this wasn't bad enough the sale of the assets involved Ron acting as the buyer through one company & as the seller for SUFC who actually owned the assets. Hardly ideal for the football club's interests.

 

[Firestorm]

http://en.wikipedia.org/wiki/Creative_accounting

"They are characterized by excessive complication and the use of novel ways of characterizing income, assets, or liabilities and the intent to influence readers towards the interpretations desired by the authors. The terms "innovative" or "aggressive" are also sometimes used.

http://www.amazon.com/Unaccountable-Accounting-Games-Accountants-Play/dp/0060104716

"I remember this interesting book from the 1970s. It begins with a corporate president interviewing three auditing firm representatives. The president asks, "How much is two plus two?"

#1 replies, "It's four."
#2 replies, "It ranges from three to five."
#3 replies, "What do you want it to be?"

Cheers, As I thought generally they do seem to relate to the overstatement of assets and inc
ome, I don't think anyone is accusing RM of that , if anything he has been accused of understating assets (ie the value of the ground when he bought it) and that revaluation was clearly stated in the accounts.

I think the differences in opinion here John, is more a difference on how our opinions have been reached. the facts at my disposal from which I form my opinion , are obviously less than the facts you have access to.