Over the cap (again)

[longlivethecrumbie]

PRL Statement:

Premiership Rugby can confirm that additional payments of £47,136.91 have been identified relating to the Salary Cap spend of Leicester Tigers in the 2019-20 Salary Cap Year.

These payments relate to salary during the COVID-19 period, which had not been included in the club’s certification for the 2019-20 Salary Cap Year.

As announced in March 2022, which was a separate matter, there was an over-spend by Leicester Tigers of £98,586.32.

In accordance with the Regulations, for this level of additional overrun, the club is required to pay £1 for every £1 overspend, being £47,136.91.

Leicester Tigers has paid the overrun tax in full.

Tigers' response:

Leicester Tigers can confirm the club has accepted and paid an overrun tax from Premiership Rugby relating to the Salary Cap spend during the 2019/20 season.

Chief Executive Officer Andrea Pinchen said: “While disappointed to again have historic salary cap spending relating to 2019/20 season result in this overrun tax, as was the case in March 2022, we accept the findings of Premiership Rugby.”

“As was the case in March 2022, this in no way relates to any of the most recent four seasons and we are grateful to Premiership Rugby for the cooperative approach in bringing this matter to a close.

“We have accepted and paid the overrun tax and, as stated in March 2022, the current club management – who inherited this issue – have a great respect for the Salary Cap regulations and remain committed to ensuring Leicester Tigers is compliant every season.”

The club will make no further comment on the matter.

I do feel sorry for Andrea on what she seems to have inherited.

[Wayne Richardson Fan Club]

Buried in the News Section, even below the blank article of our HC's thoughts on Friday nights game.

Yet again the inability of PRL to get a grip on these matters beggers belief though.

[RunTigerRun]

Could this explain why we haven’t been able to get an attack coach in temporarily also? Finances tight and having to pay fines for previous administrations’ inability to count…

[CrumblingTerrace]

So this is more overspending discovered from a season we already breached the salary cap in.

It begs the question, did the club knowingly not disclose this to PRL, or did PRL not identify it as 'salary cap spend' in the first audit?

The former would be a cover-up by the club. The latter would call into question the efficacy of the auditing regime.

Burying this news and declaring you're not going to make any further comment is not good enough. I hope the rugby journos pick this up and can dig deeper.

[Wayne Richardson Fan Club]

So this is more overspending discovered from a season we already breached the salary cap in.

It begs the question, did the club knowingly not disclose this to PRL, or did PRL not identify it as 'salary cap spend' in the first audit?

The former would be a cover-up by the club. The latter would call into question the efficacy of the auditing regime.

Burying this news and declaring you're not going to make any further comment is not good enough. I hope the rugby journos pick this up and can dig deeper.

There was little comment on the initial fine, but suggested matter closed...matter obviously wasn't closed, both Tigers & PRL have questions to answer.

[PJM]

Seems like they need a new finance director, spreadsheet or accounting package!

Can’t they add up?

[Lutontiger]

Mmm. I expect it was well-hidden, like that other club’s overspending….

[BigDan50]

Lutontiger, don’t know why hour bringing other clubs into this thread, this is squarely down to Tigers being caught cheating again.
So disappointing that we have been caught again, do we not learn by our mistakes.

[sk 88]

I don't think "cheating" is the right word about utilising the over run area anyway.

The wording of the statements here suggests there was a dispute/query about which year £50k of spending should be accounted in, rather than it being undeclared income. Given the Covid era caused many changes to payroll & the settlement of claims from 5 players I can see lots of moving parts where you can genuinely disagree which year expenditure should be booked in.

An extremely basic one is when should a player's image rights from the programmes be booked as income? We definitely do pay the players for image rights. That's legitimate, if you book it when the games occur then the games being delayed into the new cap year would cause this issue, if you book it when you pay it then the money would go out evenly each month.

That's a pedantic accountancy debate with no real world effect, but it could happen. How were the settlement agreements structured with the 5 leavers? If a portion of that was specifically about the "lost" wages then it could be argued should be in the 19-20 cap, others would say it is a ex gratia payment with no liability admitted & should be booked in the season it was paid.

[johnthegriff]

Seems bad that we have been found to have sinned again, I would like to know how it happened and what were the circumstances behind it. Obviously a team spending right up to the cap can be caught out if they anticipate incorrectly a p!ayers England selection and I am sure there are other circumstances where errors can occur with no deliberate breach planned. However to be guilty twice in a short space of time due to innocent mistakes seems unlikely and I think an open and honest explanation to the shareholders at the very least is due.
We all know that the management of our club has radically changed since the dates of the offences so no blame can be attached to the present incumbents and there maybe confidentiality agreements that prevent disclosure of the sins of the past but revealing details to shareholders keeps it inhouse.

[shedhead1]

Mmm. I expect it was well-hidden, like that other club’s overspending….

Shedhead1 here:

Lutontiger - I would be very interested to know which clubs beside Saracens and Tiggers you are talking about please? Can you back it up with evidence?

Bob

[CrumblingTerrace]

I agree with @johnthegriff that an explanation is a reasonable expectation here.

@sk88, I also take your point that there can be very complicated accountancy at-play here.

To find yourself breaching the cap so many times suggests inattentive financial management. And this inattention has brought the club into disrepute. Shareholders ought to know about that.

If we were all prepared to call out Saracens and condemn their practices, we have to accept that our own club warrant similar condemnation. (Accepting that their overrun dwarfed ours.)

I have little patience for the 'it wasn't on my watch' argument because it only serves to protect the individual currently in power. Andrea quite rightly has strong support among fans, but she was also the Chief Operating Officer during some of this overrun period.

[DeadlyDunc]

It sounds like its come about as part of a further audit from which all parties accept it is an accounting oversight/complication/point of debate and not an effort to break the rules.

As such, no real issue other than having to pay the agreed sum as a result & being told to account in the way PRL want moving forwards having had clarification.

Move on.

[wormus]

Seems bad that we have been found to have sinned again, I would like to know how it happened and what were the circumstances behind it. Obviously a team spending right up to the cap can be caught out if they anticipate incorrectly a p!ayers England selection and I am sure there are other circumstances where errors can occur with no deliberate breach planned. However to be guilty twice in a short space of time due to innocent mistakes seems unlikely and I think an open and honest explanation to the shareholders at the very least is due.
We all know that the management of our club has radically changed since the dates of the offences so no blame can be attached to the present incumbents and there maybe confidentiality agreements that prevent disclosure of the sins of the past but revealing details to shareholders keeps it inhouse.

Surely this is the first question to be asked by those on "The new Supporters Forum!!" that Andrea was establishing sometime!
Keep pushing John..

[amazing tiger]

Worst thing about this is we broke the cap and we were utterly rubbish that year as well on and off the pitch we didn’t even gain an advantage