SWANSEA City had the lowest revenues and wage bill of any of the three clubs promoted to the Premiership in 2011, according to a report published today.
Figures in the 21st Annual Review of Football Finance from the Sports Business Group at Deloitte show Swansea’s revenues for the 2010-11 season of £11.7m were considerably behind those of Queen’s Park Rangers (£16.2m) and Norwich City (£23.4).
Swansea’s 2011 wage bill at £17.4m was also the lowest of the trio, with Norwich spending a little more at £18.4m and Tony Fernandes’ QPR spending a hefty £29.7m.
Swansea’s wage bill doubled on the previous year, increasing by 109% from the £8.3m the club paid its players in the 2009-10 season. However, the significant rise is likely to be due to the bonuses paid out by the club during the promotion winning season. Rivals Norwich paid out £4.4m in such bonuses after they secured promotion.
Perhaps unsurprisingly for a club that has developed a reputation for sound financial management Swansea finished the season with the lowest funds/debt balance of any of the promoted clubs.
Its figure was a mere £754,000 for the 2011 year, far behind that of Norwich (£16.8m) and QPR (£53.9m).
Swansea made a pre-tax loss for the year of £11.2m for the season, although that figure will be far outweighed by the revenues that the club will have received as a result of a successful first season in the Premier League.
At South Wales rivals Cardiff revenues for the year were ahead of Swansea’s at £15.9m, although that figure was 6% down on the previous year.
However almost all of that money was swallowed up in wages, with the Bluebirds’ payroll totalling £15.8m during the year.
Cardiff City did make a £460,000 profit on its transfer activity, but delivered a pre-tax loss for the year of more than £12m. To put that figure in context, there were six other clubs in the Championship which posted a greater loss in the year, the biggest pre-tax loss being that of QPR, which posted a loss of more than £25m. No figures were available for Portsmouth, which entered administration.
Only three Championship clubs made a profit – Leeds Utd, Scunthorpe and Watford.
Dan Jones, partner in the sports business group at Deloitte said Swansea had performed exceptionally given the club’s wage bill.
“They definitely out-performed and that is testament to the coaching staff,” he said. “Before bonuses they were probably in the bottom half for wages and managed to get promoted, which is a phenomenal achievement.”
He also said that the club’s financial position was very healthy.
“For those of us who can remember them being on the brink of dropping out of the football league it is a great achievement,” he said.
Overall revenue in the Championship increased by £17m (4%) to £423m in the year, prompted by an increase in the parachute payments from the Premier League and the promotion of some larger clubs into the division.
Alan Switzer, director in the sports business group at Deloitte, said: “The Football League’s achievement in attracting fans and growing revenues is often overlooked.
“The Championship is the fourth best attended League in Europe, ahead of the top divisions in Italy and France.
“Whilst Championship revenues have held up well, a wages/revenue ratio of 90%, combined operating losses of £130m and record pre-tax losses of £189m, are a cause for concern.
“It is therefore encouraging that in April 2012 Championship clubs agreed to the implementation of new financial fair play regulations that aim to help clubs reduce the level of annual losses.”
As for the Premier League which Swansea reached as a result of its successful season, the report shows clubs there clubs had a record combined revenue of £2,271m in 2010/11.
Dan Jones, partner in the sports business group at Deloitte, commented: “Top clubs in English football have continued to show impressive revenue growth despite a difficult economic climate.
“Premier League clubs’ revenues increased by 12% in 2010/11, driven by broadcast revenue increasing by 13%, to £1,178m, in the first year of a new three year broadcast cycle.
“This uplift was primarily due to an increase in overseas broadcast deal values, demonstrating once again the Premier League’s unrivalled global popularity.
“Commercial revenue grew by 18% during 2010/11, although this was largely attributable to clubs with a more global profile. Matchday revenue increased by £20m (4%) to £551m, however almost half the clubs suffered a reduction in matchday revenue in 2010/11.”
More than 80% of the Premier League clubs’ revenue increase was spent on wages, which increased by £201m (14%) to almost £1.6bn, and resulted in a record Premier League wages/revenue ratio of 70%.
Adam Bull, consultant in the sports business group at Deloitte, added: “Despite the increase in revenue generated by Premier League clubs, operating profits reduced by £16m (19%) to £68m in 2010/11 and combined pre-tax losses were £380m.
“The challenge for clubs remains converting impressive revenue growth into sustainable profits. This will become even more important for a number of clubs as the financial results for 2011/12 will, for the first time, count towards their UEFA Financial Fair Play break-even calculation.”
Finance ministry identifies more deals to be taxed - Livemint.com
The finance ministry has identified several deals apart from the Vodafone-Hutchison transaction that will come within the tax net after the retrospective amendments introduced in this year’s budget are approved, a top finance ministry official said.
These deals, including the Vodafone transaction, are not covered under any double tax-avoidance treaties (DTAA) that India has with other countries and are likely to yield the government revenue of around `35,000-40,000 crore.
The move aims to target companies that take money out of their Indian subsidiaries in tax-efficient ways or that have acquired an Indian company or an Indian asset.
“There are around 10 companies apart from Vodafone which would be impacted by retrospective clarificatory amendment,” said the official who didn’t want to be named. “We will raise tax due from them soon.”
According to the official, these deals include Euro Pacific Security Ltd’s purchase of a 22% stake held by Essar’s Mauritius arm in Vodafone Essar; Accenture Services transaction related to its nearly 100% holding in Accenture India through Mauritius-registered entity Beaumont Development Centre Holdings; Sab Miller’s purchase of the Indian assets of Foster’s Australia; Sanofi Pasteur Holdings’ acquisition of Shantha Biotech from another French firm; Tata Industries’ deal involving AT&T’s stake in the company that is now Idea Cellular Ltd; the Sesa Goa transaction involving the purchase of Cairn UK’s stake in Cairn India; and Cyprus-based Richter Holdings Ltd, along with Mauritian company West Globe Ltd, acquiring the holding of UK-registered Finsider International Co., which held a 51% stake in Sesa Goa.
NDTV reported that Euro Pacific Security and Pan Asia, one of the companies mentioned by the official, have already paid taxes as per the income tax department’s demand. It cited a ministry official who wasn’t identified.
A Tata spokesperson said the matter was sub judice and declined to comment. A Sanofi spokesperson said the company is reviewing “the latest developments in the Indian tax law. It is too early for us to make any further comment at this stage”. Mint wasn’t able to reach the other companies on the list late on Wednesday.
Earlier this month, finance minister Pranab Mukherjee had clarified that retrospective amendments to the Income Tax Act in the budget would not override the provisions of the DTAA that India has with 82 countries. Mukherjee had added that retrospective clarificatory amendments would not be used to reopen cases in which assessment orders have been finalized before 1 April of this year.
On the Vodafone arbitration notice sent to the Indian government, the official said the government has replied to the company stating that the notice was premature.
“We have replied to Vodafone that there is no cause of action because no law has been amended,” the official said. “It is premature on behalf of Vodafone.”
On 18 April, Vodafone, through its Dutch subsidiary Vodafone International Holdings BV, sent the letter of dispute to the Indian government as the first step to initiate international arbitration proceedings under the bilateral investment protection agreement (BIPA) signed by the Netherlands and India. The government had set up an inter-ministerial group to finalise the government’s response.
Vodafone International Holdings BV bought the Indian business operations of Hutchison Telecommunications International Ltd (HTIL) through the sale of a Cayman Islands-based firm called CGP Investments (Holdings) Ltd, a unit of HTIL, also incorporated in the Cayman Islands. The tax department estimated the phone company’s tax liability at more than `11,000 crore. Vodafone and the Indian tax authorities went to court to resolve the issue.
In a 20 January verdict, the Supreme Court ruled in favour of the telecom company, saying the tax department did not have the jurisdiction to tax the transaction.
Following the judgement, the government brought in a retrospective amendment to bring similar transactions under the tax net.
remya.n@livemint.com
PTI contributed to this story.
Mexico Finance Minister says not worried by peso volatility - Reuters UK
MEXICO CITY |
MEXICO CITY (Reuters) - Mexico's Finance Minister Jose Antonio Meade brushed off concerns about a slump in the peso to a six-month low on Wednesday, and said the currency would rebound once concerns about Europe's debt troubles ebb.
Mexico's peso has shed more than 11 percent since mid-March, hurt by fears that Europe's sovereign debt woes are worsening.
Meade said that once concerns about Europe calm down, the peso should retrace its losses to trade where it was before fears mounted that Greece might leave the euro zone. He also dismissed the need for a more active defense of the local currency.
"If this uncertainty disappears, we would expect the peso's equilibrium would be very similar to the equilibrium we saw before these elements of uncertainty were in the market," Meade said at the Reuters Latin America Investment Summit.
On Wednesday, the peso lost as much as 2 percent against the dollar to touch 14.1660, its weakest since the end of November. The peso had been trading stronger than 13 per dollar in February and March.
The Mexican peso is one of the most liquid emerging market currencies and its sharp slump has tracked a downturn in global markets due to concerns that debt troubles in the euro zone could spark another global financial crisis.
"What we have, and what will end up setting the value of our currency, is an economy where exports are growing, an economy where consumption and investment are growing," Meade said.
Other emerging markets such as Brazil and India have resorted to ad hoc market interventions to defend their currencies.
Mexico, one of the biggest proponents of free markets among emerging economies, has a transparent auction mechanism to sell up to $400 million when the peso loses more than 2 percent from the previous day's fix price, a mid-session reference.
STRONGER FOOTING
Meade said that Mexico still believed European policymakers would avoid a messy breakup with Greece and prevent contagion from spreading to other weaker European countries.
But in case Europe's troubles take a greater toll on the global economy, Meade said Mexico is in a strong position after tripling its emergency funds since 2008.
The central bank has amassed international reserves worth more than $154 billion and the country has the protection of a flexible credit line with the International Monetary Fund.
"We have solid structural conditions," Meade said. "We are certainly better prepared to face (a global crisis) than we were when we did not have these elements of strength."
Meade said the government's projection of 3.5 percent economic growth this year was "very well anchored," adding that U.S. growth was supporting Mexico. He said the growth outlook could be revised upwards if concerns about Europe fade.
"The environment that Mexico has today and the environment that surrounds us in the United States offer some bit of certainty," he said. Mexico sends nearly 80 percent of its exports to its northern neighbor.
Still, in the event of a deeper global downturn, Meade said Mexico will not be able to provide much fiscal stimulus to the economy. But he said the central bank could lower its benchmark rate from 4.50 percent, where it has held since mid-2009.
"Surely, as in the rest of the world, there could be space within monetary policy to construct a more accommodative environment if a scenario occurs that threatens growth," he said.
Mexico's 2012 budget limits this year's deficit to 0.4 percent of gross domestic product.
The finance ministry said on Wednesday that Mexico's public sector ran a fiscal surplus of 8.2 billion pesos in April. The country has racked up a deficit of 43.4 billion pesos so far this year, keeping it on track to meet its budget limit, the ministry said.
Meade said concerns about the health of Spanish banks would not spill over into Mexico. Subsidiaries of Spanish banks BBVA (BBVA.MC) and Santander (SAN.MC) are two of Mexico's top banks, but Meade said they were well capitalized.
(Additional reporting by Krista Hughes and Ana Isabel Martinez; Editing by Phil Berlowitz)
Royal Academy of Music finance chief who swindled £100,000 from school for her pension fund jailed for 20 months - Daily Mail
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Janet Whitehouse at her court appearance at Westminster Magistrates court earlier this month, today she was sentenced at crown court
She was once hailed as the saviour of the Royal Academy of Music after rescuing the prestigious college from financial ruin.
Janet Whitehouse, 56, was considered an employee of ‘impeccable good character’ after working as its finance director for almost 20 years.
But behind the respectable facade, she was siphoning off hundreds of thousands of pounds to boost her own pension pot.
The finance chief, who earned more than 100,000 a year, swindled the college out of 236,000 over a four-year period because she was jealous of the final salary pensions that other directors enjoyed.
Whitehouse owned a 1million property portfolio in London including a luxury penthouse overlooking the Thames. She also arranged for her son to live rent-free at a flat in Marylebone owned by the academy, saving him 33,600.
Yesterday the mother-of-two broke down in tears as she was jailed for 20 months for fraud.
Southwark Crown Court heard the high-flyer, who won a businesswoman of the year award in 1997, was appointed to the highest position of trust within the academy which trains soloists, chamber and orchestral musicians, conductors, opera singers and composers.
The accountant, who was initially employed part-time in 1992 before becoming finance director in 1998, saved the charity from ruin in the mid-1990s when its finances were in a perilous state.
But secretly she was envious of colleagues’ pensions and stole money to top up her own pension which was not in the final salary scheme, the court heard.
The Aurora Orchestra plays at the Royal Academy of Music: the charity school offers training for soloists, chamber and orchestral musicians, conductors, opera singers and composers
She paid three lump sums into her pension fund, falsely claiming the payments had been approved by college chairman Lord Terence Burns between March 2007 and January 2011. A further 104,000 was submitted in ‘wholly bogus’ invoices by Whiteley Associates, a company which she and her ex-husband were directors of, for work she claimed to have carried out.
Prosecutor Antony Swift said the fraud came to light in August 2010 following a second, unconnected fraud, which prompted the academy to carry out a full audit. Whitehouse then panicked and faked letters purporting to be from senior staff agreeing to the transactions and later tried to get a colleague to destroy the evidence.
Mr Swift said: ‘She had purported to be entitled to receive additional payments into her pension.’ When she was arrested last year, Whitehouse’s life ‘disintegrated’.
Earlier this month she pleaded guilty to three counts of fraud.
Neil Saunders, defending, said Whitehouse had taken the money because she was worried about financial security. He said: ‘The catalyst appears to have been that her father was taken seriously ill before passing away in 2007.
‘It appears that it is about this time she felt under huge pressure that she did not have a secure final salary pension unlike her colleagues.’ He quoted a statement by Whitehouse in which she admitted: ‘I was too embarrassed to ask so instead I took the money. It was really bad of me.’ Mr Saunders said she was of ‘impeccable good character’ and had rescued the 190-year-old academy.
The Royal Academy of Music counts Annie Lennox and Sir Elton John among its alumni
‘Her expertise and hard work put it back on its feet when it was at a stage where it could have essentially ended all its history and existence,’ he said. ‘This is not an excuse for what she later did and she apologised to everyone at the academy for letting them down and for how truly sorry she is.
‘She deeply regrets her actions and the position she has now found herself in. What she has done has brought her name, her family and the name of the academy into disrepute.’ Whitehouse sobbed and mouthed ‘I love you’ to her partner as she was jailed.
Judge Deborah Taylor said: ‘You were appointed in 1998 to a position of the highest trust as the director of finance and administration at the Royal Academy of Music and you abused that trust by committing serious offences over a period of three-and-a-half years to enrich yourself and benefit your family by three different means.
‘There is no doubt you have worked hard for the benefit of the academy and it is never pleasant to sentence someone of your obvious quality and ability who has suffered such a fall from grace. However, you used your skills to plan and cover up three serious wrongdoings.’
Yesterday a spokesman for the academy said Whitehouse had repaid 319,465 following her resignation in March last year.
Detective Inspector Andrew Fleming, of Westminster police, said: ‘Janet Whitehouse seemed to be a pillar of society.
‘However, perhaps the worst aspect in fraud cases such as this is the complete breach of trust by a longstanding member of staff.’
Campaign Finance Challenge - Roll Call Online
Supreme Court Will Consider Direct Challenge to Citizens United Decision With Montana Case
As the Supreme Court mulls the first direct challenge to its 2010 Citizens United v. Federal Election Commission ruling, reform advocates have lobbied the court to revisit and fully debate the constitutionality of corporate political spending.
But it’s a risky strategy. If the court decides to take up and argue the challenge in question, which involves a Montana corporate spending ban, it’s anyone’s guess where it will come down.
The justices could reverse course from Citizens United and embrace new political money restrictions, as reformers argue they should. But the high court also could opt to deregulate the system further, law professor Richard Hasen said. That would leave Citizens United opponents worse off than they are today.
For example, the court might decide to throw out one of the few remaining rules on the books, such as the existing limits on contributions to parties and candidates.
“You’ve got people in the campaign finance reform community pushing for a hearing, as though that’s likely to get the court to reconsider Citizens United,” said Hasen, a professor of law and politics at the University of California-Irvine. “Not only do I think that’s a long shot — because I don’t see any evidence that the court majority has changed its position on this — I also think it could make things worse.”
None of that has stopped Members of Congress, attorneys general, activist groups and legal scholars from urging the high court to take up the Montana case, which is known as American Tradition Partnership v. Bullock. The high court signaled this week that it would meet in private conference on June 14 to decide how to proceed in the case, which turns on a constitutional challenge to a 100-year-old Montana corporate spending ban.
The Citizens United ruling, which ended decades-old limits on direct corporate and union spending, technically nullified the Montana law. But the state refused to take its corporate spending ban off the books. A trio of corporations then challenged the ban as unconstitutional, but in December the state Supreme Court sided with Montana and upheld the law.
The Supreme Court stayed that ruling in February. The high court will now decide as early as June 15-18 whether to summarily reject the state Supreme Court’s ruling, as the corporations challenging the law have requested. The court could also refuse to take up the case, leaving the Montana law in place — an outcome few expect. The court’s other option is to take up the case for full argument and briefing.
More than a dozen amicus briefs have flooded the court in the Montana case, increasing the likelihood that the justices will opt for a full rehearing, Hasen said. Those filing briefs include Sens. John McCain (R-Ariz.) and Sheldon Whitehouse (D-R.I.), who teamed up to urge the court either to let the Montana law stand or to fully revisit the corporate spending questions raised in Citizens United.
Close to two dozen attorneys general also signed on to support the amicus brief filed by Montana Attorney General Steve Bullock, thanks in part to a lobbying campaign by the progressive group Democracy for America. Sen. Mitch McConnell (R-Ky.), the U.S. Chamber of Commerce and the conservative group Citizens United, which was at the heart of the high court’s 2010 ruling, filed briefs in support of the corporations challenging the Montana ban.
Reform advocates acknowledge that if the high court opts to hear and argue the Montana case, there’s no guarantee the justices will reconsider Citizens United.
When the high court issued its stay of the state Supreme Court ruling, Justices Ruth Bader Ginsburg and Stephen Breyer issued a statement suggesting that the court should seize the opportunity to consider whether the massive political spending unleashed by Citizens United “should continue to hold sway.”
But few expect a wholesale reversal by a court that conservatives still dominate. Even if the court rejects the Montana spending ban, however, it will help activists make the public case for a constitutional amendment to reverse the Citizens United ruling, said John Bonifaz, co-founder and director of the pro-reform group Free Speech for People.
“Obviously, it’s our hope that the court does the right thing and reverses Citizens United,” Bonifaz said. “But if they don’t, it’s going to further the call for a constitutional amendment.”
If the court does take up the Montana challenge for full argument, Bonifaz predicted, the case will become a magnet for still more amicus briefs and lobbying. Reform advocates argue that the billions raised and spent by often-
undisclosed corporate interests in the 2012 elections have stirred public anger, and furnished evidence that Citizens United is not playing out as the high court anticipated.
But the ruling’s defenders argue that campaigns are more robust and competitive than ever. If anything, big spending by billionaire-backed outside groups and super PACs has fueled conservative calls for further deregulation. GOP presidential nominee Mitt Romney has argued that the solution is to lift the restrictions on direct campaign contributions, so candidates can raise and spend unlimited money.
It’s the kind of argument that Hasen, for one, warns many on the high court may find appealing.
“It’s not costless to urge the court to hear the case completely,” he warned.
FOREX-Euro falls 1 pct vs U.S. dollar to near 2-year low - Reuters India
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I am a student at the academy and can say that it is truly the best place you can be. However, I will come out with over 40,000 of debt and the fact she can just take money that could be spent on scholarships or other things that can benefit the students, without anyone noticing is totally wrong and quite frankly disappointing
- Anon, London, 31/5/2012 02:34
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