Capital gains Juventus, so are everyone fans? Numbers and controversies
Juventus is alone. What Happens on Capital Gains. Facts, numbers and analyzes (for example the Bocconian economists Morra and Masciandaro write that …)
Capital gains disrupt the world of football again . Again because the issue of capital gains cyclically muddies the Italian football environment. Now, however, the investigation by the Turin Public Prosecutor's Office on Juventus' financial activities could expand and affect many other Serie A clubs.
What are capital gains?
Capital gains are nothing more than the gain that a club derives from the sale of a player . When a team buys a player, his purchase value is budgeted and distributed for the duration of the contract, thus diluting his cost in the years following the one in which he is purchased. The player's asset value decreases as the expiry of the contract approaches. If a team manages to sell a player at a price higher than the budget, at that moment it has realized a capital gain. In our league, capital gains are still a major source of revenue for clubs.
Capital gains in mirror
Capital gains become fraudulent if they are used to "fix" budgets in difficulty by overestimating the real value of the players sold. The most suspicious transactions are the " mirror capital gains " in which no financial movements occur. Two clubs agree to swap two players by inflating their market value to include two assets in their balance sheets higher than they previously had. Juventus, and the other Serie A teams involved in the investigation by the Turin prosecutor's office, are accused of having done just that. Often these illegal movements concern youth players, whose price on the market is not yet known.
The teams involved in the investigation
Covisoc , the FIGC Supervisory Commission on Professional Football Clubs, is evaluating transactions that also affect other Serie A teams such as Naples , Genoa , Sampdoria and Empoli . With Genoa, Juventus, from 2018 to 2020, conducted operations for around 123 million euros, while Inter, since 2018, has concluded six operations with Genoa for 78 million euros.
Capital gains: Series A disease
According to an analysis by Sky Sport , in the last decade the team that has earned the most from the capital gains has been Juventus with 672.51 million , followed by Rome with 506.53 million, Napoli , 436.54 million, and Inter , 317.34 million In general, the seven major Italian clubs have produced capital gains for a total of 2.5 billion euros in the last 10 seasons, a figure that rises to 3 billion if we consider all the other Serie A teams. In the last 10 years Madrid has realized capital gains of 513.64 million, Barcelona for 522.42 million and Chelsea for 689.06 million.
The complaint of the former Head of the Federal Prosecutor Giuseppe Pecoraro: "The Court always rejected me"
Giuseppe Pecoraro, former Prefect of Rome, was head of the Federal Prosecutor's Office from 2016 to 2019 but resigned due to disagreements with the top FIGC. In the course of his leadership he tried to counteract the practice of fictitious capital gains. " I found myself in difficulty, the Court always rejected me – he declared in an interview with Corriere della Sera -. They said I couldn't be the one to determine the real cost of a player. I tried it with Mancini, today the Roma defender. At the time he was at Perugia and Fiorentina was entitled to 50% of the resale. Well, Perugia sold him to Atalanta for 200 thousand euros and at the same time they also gave the goalkeeper Santopadre, son of the president, for a million. But how could he be worth more than Mancini? In so many years we only arrived at the condemnation of Chievo and Cesena, because there were the wiretapping that nailed the protagonists ”.
The last precedent: the penalization of Chievo Verona
In 2018 Chievo Verona was the target of the Federal Court of Appeal. The Venetian team was sentenced to three points of penalty for "repeated violation and avoidance of the rules of prudence and accounting correctness" due to exchanges of suspicious players with Cesena then relegated. The federal prosecutor had asked for 15 penalty points.
The implications of financial fair play
Financial fair play was launched in 2011, in the name of sustainability and in order to stem the drift of financial debt. The clubs are so forced to balance their budget that it forces them to balance costs and revenues, except for a maximum cumulative overrun of 30 million every three years . Shareholder contributions are not treated as revenues. Initially, the results were positive, in fact the economic and financial health of the football leagues of England, Spain, Italy, Germany and France improved.
Is it all financial fair play's fault?
Fair play may also have triggered an unwanted side effect. The pressure to reach target economic and financial would have enabled the teams to resort to illicit budgetary policies. And this could be the case with capital gains. Bocconi professors Antonio Marra and Donato Masciandaro in Sole24 Ore write that, in the five major European leagues, after the introduction of fair play, the total number of transfers per team has doubled for Uefa clubs (the clubs that most often access to the Champions League) compared to the national ones and the transfers of players from the nursery (which maximize capital gains) record a + 25% for the Uefa clubs , while they remain stable for the national clubs. To this it must be added that the average transfer profit (the recorded capital gain), starting from identical values before the introduction of the rule, grows by an average of 115% for Uefa clubs, with an average peak of + 141% in the case of transactions. of exchanges of players (so-called "mirror"). Money talks could be said in this case.
This is a machine translation from Italian language of a post published on Start Magazine at the URL https://www.startmag.it/economia/plusvalenze-juventus-cosi-fan-tutti-numeri-e-polemiche/ on Sat, 04 Dec 2021 16:39:25 +0000.