[Aspireite]

The Earl of Chesterfield, on 31 July 2019 - 06:06 PM, said:

<br />My interpretation: a debt of around two million had increased to one approaching eleven and a half million over then ten or so years since Dave Allen and Ashley Carson arrived. <br /><br />On paper this rendered the business bankrupt, so the owner has written off in excess of two million owed to A&amp;S Leisure. <br /><br />Of course there'll be those who'll applaud this as a wonderful gesture whilst belittling others who don't replicate their gushing gratitude.<br /><br />On the other hand there'll be those who'll say the majority shareholder brought it upon himself by years of bewilderingly poor decisions and it underlines how the very future of CFC still hangs by the thinnest of threads...<br />

<br /><br /><br />

The debts increased since Barrie and Alan W left but as above

[azul]

The Earl of Chesterfield, on 31 July 2019 - 06:06 PM, said:

My interpretation: a debt of around two million had increased to one approaching eleven and a half million over then ten or so years since Dave Allen and Ashley Carson arrived.

On paper this rendered the business bankrupt, so the owner has written off in excess of two million owed to A&S Leisure.

Of course there'll be those who'll applaud this as a wonderful gesture whilst belittling others who don't replicate their gushing gratitude.

On the other hand there'll be those who'll say the majority shareholder brought it upon himself by years of bewilderingly poor decisions and it underlines how the very future of CFC still hangs by the thinnest of threads...

Bottom line is that he has apparently written off > £2M

The question is why? No sure > £9M is much more attractive than > £11M

[Westbars Spireite]

We're just slightly less insolvent.

[jonnythespireite]

azul, on 31 July 2019 - 06:14 PM, said:

Bottom line is that he has apparently written off > £2M

The question is why? No sure > £9M is much more attractive than > £11M

It tells you the reason in the club statement. Writing off the £2m restores the balance sheet position to a positive Net Worth. Although I assume not by much.

[Looker-on]

If the loan disappears from CFC's balance sheet, then it presumably disappears from A&S Leisure's balance sheet, too. Is there any advantage to that company, in this?

[Mr Mercury]

The Earl of Chesterfield, on 31 July 2019 - 06:06 PM, said:

My interpretation: a debt of around two million had increased to one approaching eleven and a half million over then ten or so years since Dave Allen and Ashley Carson arrived.

On paper this rendered the business bankrupt, so the owner has written off in excess of two million owed to A&S Leisure.

Of course there'll be those who'll applaud this as a wonderful gesture whilst belittling others who don't replicate their gushing gratitude.

On the other hand there'll be those who'll say the majority shareholder brought it upon himself by years of bewilderingly poor decisions and it underlines how the very future of CFC still hangs by the thinnest of threads...

When you consider that this is inclusive of a very successful stage for the club, ending four years ago, with great crowds, Wembley appearances then multilmillions coming in from player sales it really is an abject lesson on how not to run a profitable business.

[jonnythespireite]

Looker-on, on 31 July 2019 - 06:30 PM, said:

If the loan disappears from CFC's balance sheet, then it presumably disappears from A&S Leisure's balance sheet, too. Is there any advantage to that company, in this?

No. They’re 2m worse off. The other debtors figure will have reduced by a corresponding amount. Although a 2m write off to the profit and loss account may help corporation tax wise.

This post has been edited by jonnythespireite: 31 July 2019 - 06:34 PM

[Blue5]

jonnythespireite, on 31 July 2019 - 06:31 PM, said:

No. They’re 2m worse off. The other debtors figure will have reduced by a corresponding amount. Although a 2m write off to the profit and loss account may help corporation tax wise.

Not overlooking the sale of the casino in Soho.

This post has been edited by Blue5: 31 July 2019 - 06:42 PM

[Spire-Power]

Mr Mercury, on 31 July 2019 - 06:31 PM, said:

When you consider that this is inclusive of a very successful stage for the club, ending four years ago, with great crowds, Wembley appearances then multilmillions coming in from player sales it really is an abject lesson on how not to run a profitable business.

Maybe you meant object lesson, but abject seems appropriate

[Mr Mercury]

Spire-Power, on 31 July 2019 - 06:38 PM, said:

Maybe you meant object lesson, but abject seems appropriate

Also you have to ask yourself how is it possible to actually lose that much without a complete overall of the business replacing those that oversee the losses with people who can get things right?

[erniemossity]

I don’t believe this is a goodwill gesture for one minute. This is solely to ensure the company (CFC) doesn’t look insolvent balance sheet wise, and therefore presumably doesn’t attract unwanted interest from the tax man/administrators etc ( I don’t know how this sort of stuff works).....at 9 million plus in debt still, it’s far from an attractive proposition to anyone other than a huge lottery winnning town fan

[azul]

jonnythespireite, on 31 July 2019 - 06:28 PM, said:

It tells you the reason in the club statement. Writing off the £2m restores the balance sheet position to a positive Net Worth. Although I assume not by much.

And that will make it more tempting to a potential buyer on Ebay?

[Benno Spire]

A question for the accountants on here
Can a bad debt write be offset against a Capital Gains tax bill? And if so is it more beneficial to do this?

[metallilad]

After the high profile cock ups at Bolton, Bury and to a degree Notts County are the board making sure that no suspicions are raised our way?

[60s 70s Spireite]

Benno Spire, on 31 July 2019 - 07:02 PM, said:

A question for the accountants on here
Can a bad debt write be offset against a Capital Gains tax bill? And if so is it more beneficial to do this?

The answer for the sake of simplicity is yes and yes. It’s not so much a bad debt written off against CGT, but, as in the case of DA and CFC, a capital loss allowance (against CGT) for irrecoverable loans to a trading company.

However HMRC may have a different view as to whether the loan is irrecoverable.

[Benno Spire]

60s 70s Spireite, on 31 July 2019 - 07:30 PM, said:

The answer for the sake of simplicity is yes and yes. It’s not so much a bad debt written off against CGT, but, as in the case of DA and CFC, a capital loss allowance (against CGT) for irrecoverable loans to a trading company.

However HMRC may have a different view as to whether the loan is irrecoverable.

Thanks for the response
So, potentially a public statement claiming to write off a debt to avoid said business being insolvent could be an attempt to deem the money as potentially irrecoverable.

[60s 70s Spireite]

Benno Spire, on 31 July 2019 - 07:38 PM, said:

Thanks for the response
So, potentially a public statement claiming to write off a debt to avoid said business being insolvent could be an attempt to deem the money as potentially irrecoverable.

Yes (again) is the simple answer.

[Westbars Spireite]

Careful Benno, you'll be getting an invite down for a 'chat'.

[stainlessstephen]

Hmmm... Section 214 Insolvency Act 1986...

[calvin plummers socks]

What a load of old sh47e
Under DA and Carson we have become a shadow of the Club we all love and are now non-league mid table average.

This is embarrassing- why aren't we all hammering on the doors of the Club dragging the encumbents out by their grey hairs?
Terrible, really terrible