Tasmania Congratulations on Tassie License. Mens team to enter 2028. Womens team TBA. Other details TBA 3/5

[Chief]

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GO TO PART 2 of this thread:

Tasmania - Tasmania Devils, welcome to the AFL. Mens team to enter 2028. Womens team TBA. Other details TBA 3/5 (Part 2)

Continued from Part 1: https://www.bigfooty.com/forum/threads/congratulations-on-tassie-license-mens-team-to-enter-2028-womens-team-tba-other-details-tba-3-5.1226653/ Was going to draft up a Summary but this is pretty good...

www.bigfooty.com

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[Kwality]

Again, what is your point? There is no club that is currently insolvent, they wouldn't be if they were.

Who / what owns our footy club? The members.

The only thing that separates many clubs from insolvency is an AFL guarantee. Not all clubs NEED one.
Does Collingwood need an AFL guarantee?

Collingwood Football Club Ltd own the club.

https://resources.collingwoodfc.com.au/aflc-coll/document/2020/12/16/3b7165d2-1b20-4718-83cc-813a46cf6adc/2020-ANNUAL-REPORT.pdf

 

[Kwality]

If a company had 10 offices in Vic, two in each of NSW, Qld, SA & WA most would say it was national. It most certainly will be once Tassie come in.

Most would consider it a Victorian company with a national network.

 

[Kwality]

Fitzroy was neither merged or relocated. No member vote was needed because no merger occurred. I was both a Fitzroy member and shareholder in 1996. I am still a Fitzroy member and shareholder in 2021.

The administrator surrendered the licence to the AFL effectively removing Fitzroy from the AFL competition.

The assets (the players) were transferred by the AFL, not the licence. Were there any outstanding debts or was that cleaned up by the AFL?

 

[Roylion]

The assets (the players) were transferred by the AFL, not the licence.

THE AFL took over the player contracts but Brisbane paid $1 million from the 'merger monies' for the players 1996 contracts.

Were there any outstanding debts or was that cleaned up by the AFL?

The secured Nauru debt of $1.25 million was paid out of the $6 million 'merger' monies by the Brisbane Bears, who assigned a charge on Fitzroy for the money. (Remember this debt wasn't actually due until the end of 2001.) The administrator's aim was to get the best possible deal for the unsecured creditors. Brisbane offered to pay $1 million to the unsecured creditors. In the end the unsecured creditors were paid 27c in the dollar.,

 

[big_e]

The only thing that separates many clubs from insolvency is an AFL guarantee. Not all clubs NEED one.

Pretty big allegation. Perhaps you could start by indicating which clubs you speak of.

 

[Kwality]

THE AFL took over the player contracts but Brisbane paid $1 million from the 'merger monies' for the players 1996 contracts.



The secured Nauru debt of $1.25 million was paid out of the $6 million 'merger' monies by the Brisbane Bears, who assigned a charge on Fitzroy for the money. (Remember this debt wasn't actually due until the end of 2001.) The administrator's aim was to get the best possible deal for the unsecured creditors. Brisbane offered to pay $1 million to the unsecured creditors. In the end the unsecured creditors were paid 27c in the dollar.,

With unsecured creditors losing 73 cents in the dollar, how did the club avoid liquidation?

 

[Roylion]

With unsecured creditors losing 73 cents in the dollar, how did the club avoid liquidation?

Because the unsecured creditors (most of whom were Fitzroy supporters who wanted a North Melbourne merger) did not want to liquidate the club and it was the creditors' decision as to whether that happened. Either way, they would have only received 27c in the dollar even if the club had been liquidated.

Hence Fitzroy Football Club (formed 1883) still exists in its own right.

 

[Rob]

Pretty big allegation. Perhaps you could start by indicating which clubs you speak of.

You should read the annual reports of each respective club. Generally the auditors speak of the AFL guarantee and how important it is.

 

[Kwality]

Pretty big allegation. Perhaps you could start by indicating which clubs you speak of.

Not big at all, nor is it some form of gotcha, it is a commercial practice, a little like parents personal guarantee on their childs first car.
The AFL guarantees are listed in its Annual Report ever year in the fine print. Clubs with AFL guarantees include a note in the their Annual Report fine print.
Its a legal disclosure.
Without a guarantee Auditors would potentially not sign off on the Financials & that triggers legal consequences.

When Richmond sorted its debt a few years back, the AFL guarantee was withdrawn.
In recent years Essendon were forced to seek an AFL guarantee.

I'll try & pull the last AFL Report for you & link the information requested.

 

[big_e]

Not big at all, nor is it some form of gotcha, it is a commercial practice, a little like parents personal guarantee on their childs first car.
The AFL guarantees are listed in its Annual Report ever year in the fine print. Clubs with AFL guarantees include a note in the their Annual Report fine print.
Its a legal disclosure.
Without a guarantee Auditors would potentially not sign off on the Financials & that triggers legal consequences.

When Richmond sorted its debt a few years back, the AFL guarantee was withdrawn.
In recent years Essendon were forced to seek an AFL guarantee.

I'll try & pull the last AFL Report for you & link the information requested.

Doesn't mean they're insolvent without it. Far from it.

 

[Kwality]

Doesn't mean they're insolvent without it. Far from it.

Interesting take. When the Auditors sign off, you are solvent.

Solvency has legal connotations (penalties) & is the only reason some require guarantees, others dont. Auditors rely on solvency (amongst other requirements) & must report on it where found.

As I pointed out, its no gotcha, but it gives you an understanding, thats why it is included in the fine print/legal disclosures.

Dont accept the PR spin bought by footy journos.

 

[big_e]

Interesting take. When the Auditors sign off, you are solvent.

Solvency has legal connotations (penalties) & is the only reason some require guarantees, others dont. Auditors rely on solvency (amongst other requirements) & must report on it where found.

As I pointed out, its no gotcha, but it gives you an understanding, thats why it is included in the fine print/legal disclosures.

Dont accept the PR spin bought by footy journos.

I'm not buying spin. I've literally worked both for an insolvency firm, and as CFO of a company that became insolvent.

A guarantee is there as a backstop in case you can't pay a specific debt. You can have a guarantee over a bank loan but still be insolvent because you can't pay any of your other debts.

But I'm not aware of any club that is struggling to pay any of its debts, let alone needing to have that AFL pay is loans for them. My understanding is that all clubs either made they own commercial arrangement with banks, received extra support from the AFL or were in fact able to reduce their liabilities.

But if you have any different information, I'm all ears.

 

[Kwality]

With your professional background you could look at the Financials before drawing your conclusions, including the auditors role in solvency.

You will the AFL guarantees Bank loans to the clubs that require it.

Is there some reason you dont look at the AFL Financials?

 

[big_e]

With your professional background you could look at the Financials before drawing your conclusions, including the auditors role in solvency.

You will the AFL guarantees Bank loans to the clubs that require it.

Is there some reason you dont look at the AFL Financials?

You're the one who says the only thing that separates some AFL clubs from insolvency is the AFL guarantee. I say that is bollocks, but am willing to change my mind if you provide something to back up your claim.

So which clubs are you talking about, and what is the basis for your claim?

 

[Carringbush2010]

The only thing that separates many clubs from insolvency is an AFL guarantee. Not all clubs NEED one.
Does Collingwood need an AFL guarantee?

Collingwood Football Club Ltd own the club.

https://resources.collingwoodfc.com.au/aflc-coll/document/2020/12/16/3b7165d2-1b20-4718-83cc-813a46cf6adc/2020-ANNUAL-REPORT.pdf

And? They're guaranteed by the AFL, what's your point?

 

[Carringbush2010]

With your professional background you could look at the Financials before drawing your conclusions, including the auditors role in solvency.

You will the AFL guarantees Bank loans to the clubs that require it.

Is there some reason you dont look at the AFL Financials?

I'm not sure how this is pertinent to a Tas licence for an AFL club.

You keep going on about this subject about some clubs that need a 'guarantee' from the AFL like you want to justify clubs going under coz they need 'mummy and daddy (AFL) to look after em'

We all know your motive, you spruik 'too many clubs' in vic at just about every opportunity you get in any thread with the slightest of relevance. This thread being a case in point.

Enjoy.

 

[big_e]

Interesting take. When the Auditors sign off, you are solvent.

Solvency has legal connotations (penalties) & is the only reason some require guarantees, others dont. Auditors rely on solvency (amongst other requirements) & must report on it where found.

As I pointed out, its no gotcha, but it gives you an understanding, thats why it is included in the fine print/legal disclosures.

Dont accept the PR spin bought by footy journos.

FWIW, solvency is determined by the directors, not the auditors.

I'm surprised that someone with your expert knowledge on solvency and auditing has never read the Corporations Act or Auditing Standards.

 

[Kwality]

You're the one who says the only thing that separates some AFL clubs from insolvency is the AFL guarantee. I say that is bollocks, but am willing to change my mind if you provide something to back up your claim.

So which clubs are you talking about, and what is the basis for your claim?

The legal responsibility of the auditors, maybe your professional undrstanding does not run to that?

 

[Kwality]

FWIW, solvency is determined by the directors, not the auditors.

I'm surprised that someone with your expert knowledge on solvency and auditing has never read the Corporations Act or Auditing Standards.

IF the auditors dont sign off is my point. The context of my comments are AFL clubs.
Solvency is determined by the facts not the stroke of a pen.

 

[big_e]

The legal responsibility of the auditors, maybe your professional undrstanding does not run to that?

Which clubs?

 

[Kwality]

And? They're guaranteed by the AFL, what's your point?

I dont think Collingwood requires an AFL guarantee, but its been a while since I looked at their Financials. Is it a result of covid ?

 

[Kwality]

Which clubs?

Its a tedious task, & given your refusal to refer to the Financials, here is a quote from 2019 (?).

From the Report, approx $50 mil guaranteed including 10 of the 18 clubs.


5. Contingent liabilities
i. The Company has entered into an agreement with the AFL Players’ Association Inc. for a period of six years commencing on 1 November 2016 whereby the Company has an obligation to assume liability for all amounts due to players of a club where the club has lost its licence to compete in the AFL Competition and is suspended from or loses its right to representation in the League. The amounts payable in these circumstances will be offset by any amounts payable to the players in respect of future employment as a player.
ii. The Company has entered into an agreement with Westpac whereby the Company guarantees the obligations of the Carlton Football Club Limited to Westpac to a maximum of $5.0 million. This guarantee expires on 31 January 2022.
iii. The Company has entered into an agreement with Westpac whereby the Company guarantees the obligations of the Melbourne Football Club Limited to Westpac to a maximum of $3.5 million. This guarantee expires on 31 January 2022.
iv. The Company has entered into an agreement with Westpac whereby the Company guarantees the obligations of the North Melbourne Football Club Limited to Westpac to a maximum of $3.0 million. This guarantee expires on 31 January 2022.
v. The Company has entered into an agreement with Westpac whereby the Company guarantees the obligations of the St Kilda Football Club Limited to Westpac to a maximum of $6.75 million. This guarantee expires on 31 January 2022.
vi. The Company has entered into an agreement with Westpac whereby the Company guarantees the obligations of the Footscray Football Club Limited to Westpac to a maximum of $4.55 million. This guarantee expires on 31 January 2022.
vii. The Company has entered into an agreement with Westpac whereby the Company guarantees the obligations of the Brisbane Bears-Fitzroy Football Club Limited to Westpac to a maximum of $8.0 million. This guarantee expires on 31 January 2022.
viii. The Company has entered into an agreement with NAB whereby the Company guarantees the obligations of the Essendon Football Club Limited to NAB to a maximum of $8.0 million. This guarantee expires on 30 April 2021.
ix. The Company has entered into an agreement with Bank SA whereby the Company guarantees the obligations of the Port Adelaide Football Club Limited to Bank SA to a maximum of $5.0 million. This guarantee expires on 6 December 2022.
x. The Company has entered into an agreement with National Australia Bank whereby the Company guarantees the obligations of GCFC Limited to National Australia Bank to a maximum of $1.19 million (Transactional Facilities). This guarantee expires on 30 April 2021.
xi. The Company has entered into an agreement with National Australia Bank whereby the Company guarantees the obligations of GCFC Limited to National Australia Bank to a maximum of $1.59 million (Corporate Markets Loan). This guarantee expires on 30 April 2022.
xii. The Company has entered into an agreement with National Australia Bank whereby the Company guarantees the obligations of the Western Sydney Football Club Limited to National Australia Bank to a maximum of $1.53 million. This guarantee expires on 30 April 2020.
xiii. The Company has entered into an agreement with National Australia Bank whereby the Company guarantees the obligations of the Australian Football League (Victoria) Limited to National Australia Bank to a maximum of $0.35 million. This guarantee expires on 30 April 2020.
xiv. The Company has entered into an agreement with National Australia Bank whereby the Company guarantees the obligations of the AFL Queensland Limited to National Australia Bank to a maximum of $0.15 million. This guarantee expires on 30 April 2020.
xv. The Company has entered into an agreement with National Australia Bank whereby the Company guarantees the obligations of the AFL (NSW/ACT) Commission Limited to National Australia Bank to a maximum of $0.15 million. This guarantee expires on 30 April 2020.
xvi. The Company has entered into an agreement with National Australia Bank whereby the Company guarantees the obligations of the AFL Northern Territory Limited to National Australia Bank to a maximum of $0.15 million. This guarantee expires on 30 April 2020.
xvii. The Company has entered into an agreement with National Australia Bank whereby the Company guarantees the obligations of Football Tasmania Limited to National Australia Bank to a maximum of $0.06 million. This guarantee expires on 30 April 2020.

 

[Carringbush2010]

I dont think Collingwood requires an AFL guarantee, but its been a while since I looked at their Financials. Is it a result of covid ?

What does that matter and how is that thread relevant?

 

[Kwality]

What does that matter and how is that thread relevant?

See the context of the discussion.

 

[Carringbush2010]

See the context of the discussion.

The context of the thread is about a licence to compete in the AFL for a club that could be formed in Tasmania.