Jump to content
Sign in to follow this  
Jim Smith

Accounts and compensation for "loss of office"

Recommended Posts

Seriously? £1.4 million to McNally on top of his £800k salary. He resigned - there should be questions for me as to why he was entitled to that payout.

In other news I hope the £90k that has been paid to other Directors was for the acting CEO and not another director.

Share this post


Link to post
Share on other sites
Why do some get so offended that the board gets paid? Do you expect them to work for free? Would you? Most other big companies in the world pay their directors too you know.

Share this post


Link to post
Share on other sites
Maybe it was written into his contract? Top CEOs get bumper payoffs across the land and nobody seems to get upset untill it bites them on the arse.

Share this post


Link to post
Share on other sites
Pretty normal business practice really isn''t a story here.

He will have negotiated a compromise agreement taking into account future LTIPs etc and including a confidentiality clause and restricting his ability in the short term to go to another club

Let''s not let ignorance of these situations cause a great long thread

Innit

Share this post


Link to post
Share on other sites
I think the point the OP was highlighting was that he got the payout even though it was him who apparently broke his contract by resigning?

Share this post


Link to post
Share on other sites
[quote user="Herman"]Maybe it was written into his contract? Top CEOs get bumper payoffs across the land and nobody seems to get upset untill it bites them on the arse.[/quote]

Not when they resign they don''t. They do when it''s part of a "mutual agreement." I would also question who actually negotiated his contract since he pretty much seems to have controlled everything at the club.

Share this post


Link to post
Share on other sites
Yes ok YC, that may well explain it, presumably he didn''t take up another appointment elsewhere, not for a while anyway..

Share this post


Link to post
Share on other sites

Waveney in sensible post shocker.[:D] It would be appreciated if Jim could post a link to this news.

Share this post


Link to post
Share on other sites
[quote user="Jim Smith"][quote user="Herman"]Maybe it was written into his contract? Top CEOs get bumper payoffs across the land and nobody seems to get upset untill it bites them on the arse.[/quote]

Not when they resign they don''t. They do when it''s part of a "mutual agreement." I would also question who actually negotiated his contract since he pretty much seems to have controlled everything at the club.[/quote]Are you insinuating that he wrote his own contract? I have proved that I have little knowledge on this, but I would bet that that has some legality problems.

Share this post


Link to post
Share on other sites
[quote user="Herman"][quote user="Jim Smith"][quote user="Herman"]Maybe it was written into his contract? Top CEOs get bumper payoffs across the land and nobody seems to get upset untill it bites them on the arse.[/quote]

Not when they resign they don''t. They do when it''s part of a "mutual agreement." I would also question who actually negotiated his contract since he pretty much seems to have controlled everything at the club.[/quote]Are you insinuating that he wrote his own contract? I have proved that I have little knowledge on this, but I would bet that that has some legality problems.[/quote]

No I''m not insinuating that but since he was the main negotiator that the club I just wonder who he might have had those negotiations with. Based on the accounts over the years he was clearly rewarded handsomely for both success and otherwise. I''ve no doubt that it all (including this farewell payoff) was all in line with his contract, I just query the effectiveness/wisdom of a contract that rewards failure to stay in the prem so lucratively and also such a big payoff in a scenario where a director resigns publically and embarrassingly on social media.

I suspect that this payoff may have been one of the reasons behind the attempted retraction by tweet in the morning.

Share this post


Link to post
Share on other sites
In fairness, what''s done is done and cannot be changed - whether it was right or not is a good question. Personally, if you consider where we were when McNally took the reins, and where we were when he left, I think he''s entitled to take a decent payout for what he did during his time at the club. Taking us from a demorilised, heartless and debt-ridden League One to a self sustaining Premier League Yo-Yo side is pretty impressive. Although we''re in the Champ now sadly, we''ve certainly made a lot of progress as a club and as a sustainable business. If that cost us £1.4 million then so be it, better than the £25 million we owed a few years back!

I do wonder how ol'' Jez is going to live up to the standard McNally set though...

Share this post


Link to post
Share on other sites

The state of the club now and the way it is being run is nothing short of a miracle compared to where we were in 2009. McNally basically changed our whole outlook as a club, from us being an almost total basket case to a well run, self-sufficient club, challenging at the very top of the game in a world where obscene amounts of money rule.   Bit of luck involved too, Holt and Wes being main players in first two years (signed by Gunn and Roeder),  but you have to ask, where would we have been without him?    Shame the way it ended, but for four years of premier league football and three promotions in the seven years he was here, his tenure was nothing short of remarkable.  Deserves every penny. 

Share this post


Link to post
Share on other sites
Hmmm the Op does raise an interesting point. That of the Total Directors remuneration against Highest paid director , and showing a difference of £90k.

2014 and 2015 show Total AND Highest paid direct as one and the same. Now the highest and total are different, so we can assume that for the first time other director (s) are receiving a payment. Who could this be?

We can take a stab at who it isn''t, so it does seem to leave one obvious person ?

The need for successional planning just took a twist....

Share this post


Link to post
Share on other sites
Two relegations as well don''t forget. I accept we were in a better place when he left than when he arrived but really the vast majority of that is down to the prem tv monies and that was really flown to Lambert and the players. Yes he appointed Lambert so credit for that but he was also paid very, very well every year during his time here (probably circa £10m or so over the 7 years if you include this payoff) so I would continue to question a contractual position that allowed this payout when he resigned his position and having presided over another relegation and a frankly pretty shambolic season.

Share this post


Link to post
Share on other sites

Quite GPB although I suppose it could have been Stone as interim CEO? If not and it is the other scenario then presumably that''s not even a full year?

Share this post


Link to post
Share on other sites
Some would appear to prefer we were still in League One ...or worse.Had he walked when we got promoted to the Premier League those same people would have moaned at the Club for not doing enough to make him stay.Look forwards, not back. You can only mold the future, not change the past.

Share this post


Link to post
Share on other sites
I honestly don''t know Jim. I just was interested in the numbers that you raised, so had a look at my copy of the accounts fresh from the door mat this morning, and then a quick look at the previous two years.

Putting 2 and 2 together on Company accounts can be dangerous sometimes, particularly with our old friend "Emoluments" , however I''m sure some might look at recent appointments and make an assumption.

Might be Crackers. Who knows ?

Share this post


Link to post
Share on other sites
Does anyone know what some of our players, who didn''t contribute a lot, were paid last year, in a relegated team? That might be a more salient conversation, when discussing ''worth'' or ''contribution''.

Share this post


Link to post
Share on other sites
Whatever he was paid or what his ''personality'' was like, I''m glad we had him at the club and for the way he helped us recover.

Compare it to the amount we have wasted on players then it''s brilliant value for money in my books!

Share this post


Link to post
Share on other sites

Key Points

Key points of note: 

- Income up to £100.6m (£53.6m in 2014-15) as a result of a season in the Premier League (broadcasting revenue up £41.6m) 

- Operating profit of £14.2m (Operating loss of £8.7m in 2014-15 after bonus payments of £11.1m that were conditional on a Premier League return) 

- Profit after tax of £9.4m (Loss after tax of £5.3m in 2014-15) 

- Profit in the year driven by increased broadcasting revenue as a result of spending 2015-16 in the Premier League 

- As at 30th June 2016, external debt, in the form of a bank working capital facility, totalled £2.7m (£0.0m as at 30th June 2015), which has subsequently been repaid post the year end.  The remaining Directors’ loans of £2.0m were repaid during the year 

-    Cash outflow in the year of £(4.5)m, explained as follows: 
-    Cash generated from operating activities of £8.2m 
-    Player purchases – cash outflow of £(22.6)m 
-    Player sales – cash inflow of £11.6m 
-    Fixed asset spend, mainly at Colney of £(2.1)m 
-    Repayment of Directors’ loans of £(2.0)m 
-    Tax refund of £2.7m 
-    Other net cash outflows of £(0.3)m 

-    Compensation for loss of office due to David McNally of £1.4m, following his resignation in May 2016. 


£m 2015-16£m 2014-15*
Income 100.6 53.6 
Operating expenses (excluding player trading) (85.2) (62.8) 
Player trading (1.2) 0.5 
Operating profit/(loss)14.2 (8.7) 
Interest (payable)/receivable (1.2) 0.6 
Tax(3.6) 2.8 
Profit/(loss) after tax 9.4 (5.3) 
EBITDA38.5 6.4 
Closing cash position (2.6) 1.9 

*Comparative numbers for 2014-15 differ slightly from those reported last year as a result of adopting new mandatory Financial Reporting Standards as explained in Note 1(a) of the annual accounts. 

Key actions taken in the business within the last 12 months include: 

-    Ensuring financial position remains strong despite relegation, due to no debt and relegation clauses in all player contracts 
-    New Chief Executive, Jez Moxey, appointed after exhaustive recruitment process over the summer 
-    Continued strategy of investing spare cash in to football in each transfer window 
-    9 new players were recruited during the financial period being reported on 
-    A further 5 new players have been recruited into the squad since the end of the financial year and several senior players have had their contracts renewed 
-    Continued to work closely with the local community through official charity partner Norwich City Community Sports Foundation 

The Club’s main objective for the current season is to return to the Premier League at the first opportunity. 

City Chairman Ed Balls commented: "These figures once again underline the huge gap in revenues between the Premier League and the Championship. 

"The Club’s strategy has been and continues to be to invest all available surplus cash into the playing squad, hence maximising the chances of returning to the Premier League at the earliest opportunity."

Share this post


Link to post
Share on other sites
[quote user="Graham Paddons Beard"]Hmmm the Op does raise an interesting point. That of the Total Directors remuneration against Highest paid director , and showing a difference of £90k.

2014 and 2015 show Total AND Highest paid direct as one and the same. Now the highest and total are different, so we can assume that for the first time other director (s) are receiving a payment. Who could this be?

We can take a stab at who it isn''t, so it does seem to leave one obvious person ?

The need for successional planning just took a twist....
[/quote]Smith the Younger? Possibly, but I would have thought if they are paying another director something (even as  a kind of compensation for loss of earnings elsewhere) then it would more probably be Ed Balls, as a semi-executive chairman.

Share this post


Link to post
Share on other sites
The net investment in the squad in year was £9 million (£35 million outlay less £21M profit and disposal cost of £5 Million). Subsequent to year end a further £13 million with another potential of a further £9 million on top of that if we get back to the Premier league. Frankly I am surprised by that as press reports during the season were indicating break-even - can''t wait for the agents payments report when that comes out.

Also the investment is actually funded long term by spreading transfer payments - £25 million still owed on transfer payments at year end offset by £22 million owed to us - hence £3 million overdraft. Living within our means. Apart from the compo of course!

Share this post


Link to post
Share on other sites
I was certainly no fan of McNally but surely his payoff was in lieu of his notice period. There would no doubt be a lengthy notice period for both sides in his contract and as his position became untenable due to his resignation the club were obliged to pay him the notice period for him to go immediately. A rough guess taking the amount into consideration was probably an 18 month notice period.

Share this post


Link to post
Share on other sites
Ron, thinking about the logistics of it all, you are probably on the right track. It is not uncommon for managers to have similar clauses in their contracts, so probably not too unlikely that McNally would have had, given what he achieved at the club and how highly regarded he was, I would imagine that nobody would have argued against it.

Share this post


Link to post
Share on other sites

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
Sign in to follow this  

×