How Can Chelsea Comply with FFP rules?

She Moves In Her Own Way

Even after the enormous outlay in the transfer market last season, there is no sign of Chelsea’s player purchases slowing down. The Blues’ spending since Todd Boehly’s Clearlake Capital acquired the club in May 2022 has been quite unprecedented,

This has led to many football pundits sagely explaining how they have managed to do this via the use of an accounting “trick”, known as player amortisation, but is that really the whole story?

This blog will explain how the accounting treatment for player trading does indeed help football clubs meet their FFP targets, but will also take a broader look at Chelsea’s business model, including revenue projections, which are just as important in assessing a club’s profitability.

Other Clubs’ Views

Chelsea’s massive spending has certainly puzzled managers at some of their main rivals.

Liverpool’s Jürgen Klopp said, “I don’t understand this part of the business, but it’s a big number. I don’t understand how it’s possible, but it’s not for me to explain how it works.”

Pep Guardiola’s view was that Manchester City would have been crucified if his club had spent nearly £1 billion on players, “I couldn’t sit here if we spent what Chelsea spent in the last two transfer windows – you would kill me. We’d be under scrutiny like you couldn’t imagine.”

Transfers

The 2023 summer transfer window has not yet closed, but Chelsea have already splashed out £334m, which is significantly more than any other club in the Premier League. Some have also spent big, e.g. Arsenal £204m, Tottenham £168m and Manchester United £167m, but they are all trailing in Chelsea’s slipstream.

In fact, the £872m that Chelsea have spent since Boehly’s arrival is more than twice as much as the next highest English club, namely Manchester United with £378m. Including potential add-ons, Chelsea’s gross transfer spend in the last 14 months is an amazing £950m. Nobody would be remotely surprised if the total breaks through the £1 bln barrier by the time the window has closed.

To further place Chelsea’s expenditure into context, the amounts spent in the last two seasons are the highest ever reported in the Premier League. In fact, the £539m outlay in 2022/23 was over £200m more than Manchester City’s previous record of £328m in 2017/18.