Size of club debt

[Bernie44]

Hello, I've been asked to write something on the club's finances and the current size of our total debt heading into the new season. I've heard it is allegedly somewhere between £20-£30million. Can anyone clarify these figures for me please? Cheers, Bernie

 

[shrimpfan]

how long is a piece of string?

 

[RHB]

Hello, I've been asked to write something on the club's finances and the current size of our total debt heading into the new season. I've heard it is allegedly somewhere between £20-£30million. Can anyone clarify these figures for me please? Cheers, Bernie

Good luck with that one. I have no doubt you will get figures quoted that folk believe the debt figure is, but the reality is that only Ron/the Club really know and they are not going to share any time soon.

Thinking about it sensibly, your best bet is to approach the Shrimpers Trust or Chris Phillips.

 

[flangejackrabbit]

What are you hoping to demonstrate by looking at this number? It's a largely academic figure given the debt is pretty much all to other companies owned by the chairman and is unlikely to be ever called in unless we hit a huge windfall.

 

[Leo210856]

What are you hoping to demonstrate by looking at this number? It's a largely academic figure given the debt is pretty much all to other companies owned by the chairman and is unlikely to be ever called in unless we hit a huge windfall.

When , cough cough, the 2019 accounts turn up on the Companies House website the numbers in those accounts without doubt will show debts close to £20 million and yes the bulk of the debt will be owed to companies linked to the chairman but as is well documented HMRCs payments are unlikely to be up to date and that creditor is one there have been some near misses

Alas a lot has happened post 31July 2019 and within days those figures will be 2 years out of date.

So to be honest I wouldn’t try and establish what the current debt of the club because the impact of COVID, the relegations and paying sizeable severance payments will all add to some horrendous numbers

 

[stortford]

If you want to know about HMRC payments suggest you have a scroll through the tax tribunal reports published last month.

 

[Bernie44]

When , cough cough, the 2019 accounts turn up on the Companies House website the numbers in those accounts without doubt will show debts close to £20 million and yes the bulk of the debt will be owed to companies linked to the chairman but as is well documented HMRCs payments are unlikely to be up to date and that creditor is one there have been some near misses

Alas a lot has happened post 31July 2019 and within days those figures will be 2 years out of date.

So to be honest I wouldn’t try and establish what the current debt of the club because the impact of COVID, the relegations and paying sizeable severance payments will all add to some horrendous numbers

Thanks very much! Appreciate it... confirming pretty much what my own research had led to.

 

[Leo210856]

If you want to know about HMRC payments suggest you have a scroll through the tax tribunal reports published last month.

wasn’t aware any publication from HMRC would detail debts that said can you provide link

 

[Leo210856]

If you want to know about HMRC payments suggest you have a scroll through the tax tribunal reports published last month.

Now found the tribunal report you talk about. Not sure this tells us an awful lot about the current position but it does detail HMRCs approach going forward.

 

[Medway Blue]

Now found the tribunal report you talk about. Not sure this tells us an awful lot about the current position but it does detail HMRCs approach going forward.

Could you share?

 

[Leo210856]

Could you share?

Southend United Football Club Ltd & Ors [2021] TC 08178 | Croner-i Tax and Accounting

[2021] UKFTT 229 (TC) Judge Richard Chapman QC Decision released 23 June 2021 PAYE, NIC & VAT – Notices of requirement to pay security – Whether or not the appeal is against the whole decision-making process – Yes – Whether or not the decisions were ones that could not reasonably have been...

library.croneri.co.uk

 

[kentblues]

Hello, I've been asked to write something on the club's finances and the current size of our total debt heading into the new season. I've heard it is allegedly somewhere between £20-£30million. Can anyone clarify these figures for me please? Cheers, Bernie

I can help you with this- we don’t have any debt believe it or not. All money owed is to Ron and his companies (I.e. inter company) we don’t even have a bank overdraft as I understand it.

 

[Supa Shrimpa]

I can help you with this- we don’t have any debt believe it or not. All money owed is to Ron and his companies (I.e. inter company) we don’t even have a bank overdraft as I understand it.

There is a huge debt we owe to the other group companies. They still show as a creditor, along with Trade Creditors etc. The 2018 accounts showed the overdraft owing as £16,379, so we did at that time.

 

[kentblues]

There is a huge debt we owe to the other group companies. They still show as a creditor, along with Trade Creditors etc. The 2018 accounts showed the overdraft owing as £16,379, so we did at that time.

Yes other Group companies = Ron

 

[LBBlue]

Yes other Group companies = Ron

But I think you will find that “other Group companies” owe third parties millions

 

[kentblues]

But I think you will find that “other Group companies” owe third parties millions

I haven't looked recently. I assume you are referring to funds raised against collateral (i.e. charges assets primarily land?). Ron is a property developer so this is not unusual to fund the business in this way. The point is the charge will represent an amount less than the value of the asset which can be sold to settle the debt? And more confusing is that charge might be against the true asset value, wheres unless there have been revaluations the asset may be in the books at a far lower value? Its can be complicated, and Ron's myriad of companies are extensive, and each is a limited company so restricting liability unless there are cross company guarantees.

Anyhow quite likely to be a mute point on the upcoming change in real value of two assets in particular- Fossets Farm and Roots Hall with planning will increase in value exponentially.

What we can say is that no-one knows the true financial situation all be it nothing in the public domain makes it look very pretty. And Ron always finds the money- indeed has always said this isn't the issue. Rather it's that most of his assets are not liquid and it takes time to leverage them for cash.

 

[kentblues]

Southend United Football Club Ltd & Ors [2021] TC 08178 | Croner-i Tax and Accounting

[2021] UKFTT 229 (TC) Judge Richard Chapman QC Decision released 23 June 2021 PAYE, NIC & VAT – Notices of requirement to pay security – Whether or not the appeal is against the whole decision-making process – Yes – Whether or not the decisions were ones that could not reasonably have been...

library.croneri.co.uk

This is the only debt that really matters not the inter company.
Suspect HMRC sense there are going to be assets they can leverage as security/to hasten clearance of the outstanding debt....and they probably are right in thinking same.
We have had so many years of this now- reality is probably the club is less at risk than it has been for a number of years.

We all need that planning green light to breath easier however...

 

[Yorkshire Blue]

Anyhow quite likely to be a mute point on the upcoming change in real value of two assets in particular- Fossets Farm and Roots Hall with planning will increase in value exponentially.

A mute point until Ron next writes a blog, probably some time in 2022?

 

[Napster]

A mute point until Ron next writes a blog, probably some time in 2022?

Still waiting.

 

[mattytheshrimper]

IF we are up to 30 million is debt it's sickening that our club (and a club of our size) can accumulate such a debt of that size and can be ran into the ground like this without as much of a whimper from us fans and certain supporter groups with actual links to speak to people at the club.

I just hope we don't look back at the past few years and realise we did nothing to stop the rot and at least try to get Ron to do the right thing. I know we don't want to affect the players performing on the pitch but soon we might not have any players or a pitch for that matter.

I fear it won't be long until the youth team or a fringe player stop getting paid or get paid late. Then if it goes to the extent of players not being paid then we'll be doomed. I have no evidence to suggest that's going to happen but it's a real fear I have as I have no confidence in anything anyone's doing at the club at the moment. Any good people left will be massively limited to being able to do any good with Ron tying their hands behind their back.