04/24/24
November 25, 2003
The normally reputable publication Forbes has had their recent NHL franchise valuation report deemed "shoddy". This should come as no surprise given the Forbian analysis of League operations.
Great points about concessions and other related incomes that, thanks to 'creative' accounting practices, are left off the P/L sheet. As a result, teams were able to manufacture $300 million in losses last year, while curiously saving the same amount for a self-inflicted rainy day. I'm not sure how other people read this scenario, but its seems relatively straight forward to me. On average, there weren't any losses. On average, the teams broke even. Not accounting for the extra, and 'unrelated', incomes.
posted by garfield at 02:05 PM on November 26, 2003
The way so many corporate executives--not just in sports, i.e., the mutual fund scandal just now--scratch and claw for every advantage and every last penny is a sad indictment of us all. Am I being too positive in advance of Thanksgiving or what?
posted by billsaysthis at 02:16 PM on November 26, 2003
bill, I'm glad you made the comparison. Just as Wall Street execs receive a slap on the wrist for knowingly committing massive fraud, so to will the League owners escape virtually unscathed, despite their collective hand in creating their current mess; fabricated, legitimate, or otherwise. To all (celebrants), Happy Turkey day.
posted by garfield at 02:22 PM on November 26, 2003
The truth of the matter is sports changed irrevocably when Bill Veeck figured out how to show a tax loss while making a profit. Team ownership was no longer for the ex-player or small-time local magnate, but rather a crown jewel for multi-millionaires to write off profits in other businesses. The fact NHL franchises deny their profits shouldn't suprise anyone. Much as I hate to admit it, they're not even committing a crime. They're simply doing what most everyone else does at tax time: claiming as little revenue as possible. I like to think Jeremy Jacobs has a sign on his office desk that says, "Yes, as a matter of fact, I do own the whole damn building."
posted by yerfatma at 04:46 PM on November 26, 2003
I'd be interested to see how they arrived at these figures as well. And do all team owners also have control of concessions like Jeremy Jacob's of the Bruins? or a stake in merchandising? I have to think whether or not they own their own arena adds to the bottom line as well. It has often been said Jacob's would rather field a better chicken sandwich than a team. No wonder there are dozens of boycott groups out there trying to persuade him to change his stingy ways.