No wonder @OU11 gave no shits for our conservative budgeting reasoning @Travis7401
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The Accounting Class
- Thread starter Orlando
- Start date
I thought the $10 @Yankee151 cash max was common knowledge. The reason to run a huge surplus in the past was because it seemed to be the best way to grow your budget.
It it is a little interesting that the budgets are so volatile. You'd think they would lag a little bit each way.
It it is a little interesting that the budgets are so volatile. You'd think they would lag a little bit each way.
Yeah, you are going to get $10M cash no matter what, basically. The lower level teams can hemorrhage cash and will be saved by revenue sharing. The upper level teams will generate plenty of revenue even if they don't make the playoffs, so their budgets stay high regardless, since budget is based on Pre-playoff revenue.
Look at Cairo as an example of the only team from last season that ended in such a way that punished them at all. They finished the seasona $1.1M loss had to pay $2.7M in revenue sharing, so their cash going forward was only $6.2M. So for being fiscally irresponsible they only lost $4M in cash. Even if you fuck the pooch completely, my assumption is you just start at $0 cash?
Look at Cairo as an example of the only team from last season that ended in such a way that punished them at all. They finished the seasona $1.1M loss had to pay $2.7M in revenue sharing, so their cash going forward was only $6.2M. So for being fiscally irresponsible they only lost $4M in cash. Even if you fuck the pooch completely, my assumption is you just start at $0 cash?
They weren't really fiscally irresponsible though. The point of having a budget is to use it. If your team underperforms and attendance takes a hit you can miss by a few million. We just haven't played that way.
The he reason most teams carry cash is to take on FAs or to send in trades. You really shouldn't spend that money if you run a tight budget because it is money available beyond your budget.
The he reason most teams carry cash is to take on FAs or to send in trades. You really shouldn't spend that money if you run a tight budget because it is money available beyond your budget.
lol, how would you change it? Are you going to rewrite the code? This is what I'm tom bout, revenue sharing will always flow into cash, never budget. So if you want to go with more cash, just know that the big budgets get it too, and we make a lot more than you. I've been good for a while and average 30M profit so I'm keeping that in your system. You want a 20M cash budget and I'm going to have it too. That's all I'm saying. I might only have it until the year I spend it, but I will have it.
I mean for any big budgets with aging teams like myself it makes sense, but for up and coming teams with their starters on minimums or first contracts they will have that $20M every year.
For teams like Amsterdam who have payrolls going up, we're going to be able to go off in IFA once unless we get our payroll down. I think I could get whatever max you want to put it at every year until my next wave of contracts. I make $40M~ like clockwork and $10-$12M goes into revenue sharing. Clodio takes the rest.
So, again, how do you think you can change this system that you're trying to revolt against. Ruffling the crowd up when there is no solution doesn't help anyone, whatchu wanna do?
No your cash can go to -infinity
I'm not suggesting changes, just trying to understand how the system works. I just hope you won't be upset when I send someone $40M in cash because I can.
Well you can't unless you send $10M per for 4 years.
Revenue sharing tidies up cash, owner takes the rest. Obviously if budgets are based on regular season revenue those won't be affected by anything but regular season revenue.
So unless you change cash the only reason for revenue sharing is to help the bottom feeders make the most of their budget. If they run a deficit they can be replenished. That is literally the only way revenue sharing helps anyone. If you are a big team, you have to make more than you used to because as your budget goes up so does your tax.
Very simple. If you don't like it, we can tinker with it. I can change different things but you have to tell me how you want it to act. When you tell me what you want I can tell you if that is possible. If you want more cash I can do that, but there are downsides that you might be shortsighted on. The big budgets get there because they make a lot of money, most of which is kept by the owner. If we up the cash budget those guys are going to have the max cash too 9/10 times.
That's all I'm getting at.
Mr. Radpants
Trog Five Standing By
Just submit your resume already Travis
Why can I only send $10M/year, that part I don't understand. Lets say I want to send Cash to someone like Osick who is cash poor. Why can't I send him $20M of my 2050 budget, hypothetically speaking, so that he can afford to sign some draft picks and target some free agents and such. Is there a restriction on that of $10M/year as well?
It should also be noted that the way we have it set up, there is very little financial incentive for making the playoffs vs not making the playoffs, as your owner will almost always just pocket the playoff money. I'm not saying I'm opposed to this, I'm just mentioning it because I've seen people mention "needing to make the playoffs." Teams that are in the playoff hunt at least generally hit their revenue target and will at worst take a small cash hit due to revenue sharing. Whereas the teams who go to the finals and generate $20+ Million cannot take advantage of that with the $10M cap.
Yankee151
Hot Girl Summer
The idea is if you're going to make the playoffs you get an extra 15mm (or whatever playoff money is, idk since I never make the playoffs) to spend on payroll in anticipation of making the playoffs so you can come in under 10mm. The money only disappears into thin air if you dont spend it, if you do it's fine.
but ur budget limits you from overspending anyway, since it is based on regular season revenue from the previous year.
Yankee151
Hot Girl Summer
Like you cant say there's no incentive to running a big profit when I got a 16mm budget increase while going 50-112 on the season, there is obviously a benefit it's just not a cash one. If I wanted to compete this year I could get every FA because I have the room for it. There is certainly a benefit to having 80mm in cash to sign FAs with no matter how you slice it, if we upped the cash I would have 120mm to spend on FAs.
If you make the playoffs then your budget the next year will increase relative to what you would've gotten had you not, simply due to the fact that your profit margin will be larger (or your loss margin lessened)
If you make the playoffs then your budget the next year will increase relative to what you would've gotten had you not, simply due to the fact that your profit margin will be larger (or your loss margin lessened)
No it definitely won't, I've already proven this. Your budget the next year tracks directly with your previous year regular season revenue.
Here you go boys, based only on readily available financial data:
Draw ur own conclusions, but this seems to be pretty clear to me.
[xtable=skin1|50x@]
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{td=64x@} {/td}
{td=154x@} {/td}
{td=87x@}2049{/td}
{td=87x@}2049{/td}
{td=84x@}2049{/td}
{td=94x@}2049{/td}
{td=86x@}2049{/td}
{td=86x@}2049{/td}
{td=108x@}2049{/td}
{td=87x@}2050{/td}
{/tr}
{tr}
{td} {/td}
{td} {/td}
{td}Revenue{/td}
{td}Expenses{/td}
{td}Profit{/td}
{td}Cash{/td}
{td}Balance{/td}
{td}Playoffs{/td}
{td}Regular Revenue{/td}
{td}Budget{/td}
{/tr}
{tr}
{td} {/td}
{td}Amsterdam Tulips{/td}
{td}$196,921,587{/td}
{td}$162,472,318{/td}
{td}$34,449,269{/td}
{td}$10,000,000{/td}
{td}$44,449,269{/td}
{td}$23,791,189{/td}
{td}$173,130,398{/td}
{td}$174,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Berlin Bomber Bears{/td}
{td}$127,892,063{/td}
{td}$109,545,341{/td}
{td}$18,346,722{/td}
{td}$10,000,000{/td}
{td}$28,346,722{/td}
{td}$0{/td}
{td}$127,892,063{/td}
{td}$128,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Buenos Aires Gauchos{/td}
{td}$171,617,739{/td}
{td}$156,604,655{/td}
{td}$15,013,084{/td}
{td}$10,000,000{/td}
{td}$25,013,084{/td}
{td}$20,898,273{/td}
{td}$150,719,466{/td}
{td}$152,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Buffalo Murricans{/td}
{td}$150,656,923{/td}
{td}$148,545,631{/td}
{td}$2,111,292{/td}
{td}$10,000,000{/td}
{td}$12,111,292{/td}
{td}$0{/td}
{td}$150,656,923{/td}
{td}$152,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Cairo Tutankhamuns{/td}
{td}$153,831,913{/td}
{td}$155,027,509{/td}
{td}($1,195,596){/td}
{td}$10,000,000{/td}
{td}$8,804,404{/td}
{td}$0{/td}
{td}$153,831,913{/td}
{td}$154,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Dublin Distillers{/td}
{td}$94,301,655{/td}
{td}$89,534,953{/td}
{td}$4,766,702{/td}
{td}$8,500,000{/td}
{td}$13,266,702{/td}
{td}$0{/td}
{td}$94,301,655{/td}
{td}$95,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}False Bay Flying Whites{/td}
{td}$173,545,184{/td}
{td}$154,778,962{/td}
{td}$18,766,222{/td}
{td}$10,000,000{/td}
{td}$28,766,222{/td}
{td}$6,223,870{/td}
{td}$167,321,314{/td}
{td}$170,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Helsingborg Hammers{/td}
{td}$152,815,396{/td}
{td}$150,135,769{/td}
{td}$2,679,627{/td}
{td}$10,000,000{/td}
{td}$12,679,627{/td}
{td}$0{/td}
{td}$152,815,396{/td}
{td}$154,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Istanbul Ottomans{/td}
{td}$128,860,553{/td}
{td}$59,720,868{/td}
{td}$69,139,685{/td}
{td}($4,433,581){/td}
{td}$64,706,104{/td}
{td}$0{/td}
{td}$128,860,553{/td}
{td}$130,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Kabul Bulls{/td}
{td}$170,602,462{/td}
{td}$110,831,565{/td}
{td}$59,770,897{/td}
{td}$10,000,000{/td}
{td}$69,770,897{/td}
{td}$13,095,061{/td}
{td}$157,507,401{/td}
{td}$158,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Key West Pirates{/td}
{td}$114,552,840{/td}
{td}$85,804,406{/td}
{td}$28,748,434{/td}
{td}$10,000,000{/td}
{td}$38,748,434{/td}
{td}$5,600,260{/td}
{td}$108,952,580{/td}
{td}$110,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Las Vegas Pac Men{/td}
{td}$171,108,405{/td}
{td}$169,702,456{/td}
{td}$1,405,949{/td}
{td}$11,500,000{/td}
{td}$12,905,949{/td}
{td}$7,177,857{/td}
{td}$163,930,548{/td}
{td}$168,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Lisbon Conquistadors{/td}
{td}$95,720,291{/td}
{td}$104,123,067{/td}
{td}($8,402,776){/td}
{td}$10,000,000{/td}
{td}$1,597,224{/td}
{td}$0{/td}
{td}$95,720,291{/td}
{td}$96,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Little Rock Miners{/td}
{td}$83,694,495{/td}
{td}$95,517,476{/td}
{td}($11,822,981){/td}
{td}$10,000,000{/td}
{td}($1,822,981){/td}
{td}$0{/td}
{td}$83,694,495{/td}
{td}$83,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Moscow Mules{/td}
{td}$161,940,483{/td}
{td}$131,395,638{/td}
{td}$30,544,845{/td}
{td}$10,000,000{/td}
{td}$40,544,845{/td}
{td}$14,641,460{/td}
{td}$147,299,023{/td}
{td}$150,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}North Dakota Riggers{/td}
{td}$111,881,680{/td}
{td}$77,323,648{/td}
{td}$34,558,032{/td}
{td}$10,000,000{/td}
{td}$44,558,032{/td}
{td}$0{/td}
{td}$111,881,680{/td}
{td}$112,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}San Francisco Tanners{/td}
{td}$102,594,860{/td}
{td}$94,657,111{/td}
{td}$7,937,749{/td}
{td}$10,000,000{/td}
{td}$17,937,749{/td}
{td}$0{/td}
{td}$102,594,860{/td}
{td}$104,000,000{/td}
{/tr}
{tr}
{td} {/td}
{td}Seoul Glow{/td}
{td}$158,740,305{/td}
{td}$155,888,734{/td}
{td}$2,851,571{/td}
{td}$10,000,000{/td}
{td}$12,851,571{/td}
{td}$5,207,730{/td}
{td}$153,532,575{/td}
{td}$154,000,000{/td}
{/tr}
{/tbody}
[/xtable]
Yankee151
Hot Girl Summer
Alright I'm looking at this and I want to see somethingI'll post my numbers because I don't care. Go through and add subtract expenses and revenue and it is plain as day what is going on. It is the same for every team, if you can't see the numbers of other teams and they are starting way higher than you just know that it is because their revenues are higher and their expenses are lower. Once the season starts that will change dramatically because of payroll
The end balance is certainly affected by playoff Rev. Last year OU's end balance would've been 21mm~ if not for the playoff rev. So that makes my question, What if he was short? Like what if he had more expenses than revenue and didn't make the playoffs vs if he does? You can tell that the next year's starting balance (10m cash after rev sharing and owner floor) uses the previous year in calculation (only to the point where it can get 10m), so if you hit the floor you are going to have less than 10m right?
It still appears that starting balance is Base Revenues + Cash - Base Expenses, if so a negative in cash (by not making enough playoff revenue) would affect that I think. I understand Osick's decision to hide his stuff but I'd be interested to see if that affected him any because I know he's in a tight spot right now, would he be even worse without playoff rev or not?
I understand it 'disappears' if you are running a profit like OU is, but what about if the playoff revenue is the only thing that puts you over?
Yankee151
Hot Girl Summer
Alright I guess Budget = Reg Rev +1-3m unless your regular revenue is negative like Bruin in which case he dropped like 700k. I guess there's no cases this year but I am still wondering what Lisbon or Little Rock would've done had they made the playoffs with their Revenue to Expenses ratios. Lisbon made a loss but covered it with cash while LR's loss was too big for 10m to cover. I think more cash just lets you run more of a loss on budget, you could run a 20m profit deficit and not lose anything to your budget.
Because you only have $10M in cash. Your budget is what you can spend, not what you have. I'll try to break it down like this, your owner says you made him $170M last year, he'll allow you to spend $170 this year. It doesn't mean you have that in cash, it means he'll back your costs up to $170M
He's not going to just give you that in cash money so you can go blow it in vegas
Yankee151
Hot Girl Summer
I guess basically even if you run a loss and dont make the playoffs you're fine, Say LV doesn't (And their Rev becomes 163mm to 169mm in expenses), they would have still be fine since their 10mm in cash would cover it. I think if you raised the cash you could cover even bigger losses. Playoff Revenue DOES count IF that money covers the gap between Regular Revenue and Expenses IF that gap is more than 10mm. So If you are running 100 in Reg Rev and 120 in expenses but make the playoffs and get anywhere from 10-20mm there (as long as it enables your 10mm in cash to cover the rest of your loss), your profit is $0 instead of -$20mm, and thus you avoid a drop in budget (Not making the playoffs would cause a decrease in the budget relative to Regular Revenue as shown by Bruin dropping)
Think about things just a little bit. If you're in the playoffs generally you're selling out throughout the year, meaning you make much more money throughout the year than non playoff teams or teams that are inching in. Look at my team for example, I was out of the playoff race for a while, then I was kind of piddling in 5th for a while, then the last month I raced to the 3rd spot. What is different compared to the years I was in first from start to finish? I lost 4k in attendance.
As long as you are in the playoff hunt, you are very likely generating enough revenue to meet your expectations, since they don't consider playoff revenue, and at least come close to your budget. You can see @osick87 s regular season revenue was $150M and his expenses were $156M. If he didn't make the playoffs, his revenue sharing would have been equivalent to the Buffalo Murricans 2.1 M number (based on their 150M revenue). That means at worst, he would have started this season with about $2M (10-6-2) cash had he not made the playoffs. He was running the highest payroll in the league as well as high scout/dev budgets, spending all his cash, so even going "all in" on making the playoffs, the worst that could have happened would be starting with $8M less cash this season. I'm not actually sure that's what happens though, as his owner could potentially just put cash in to get him up to that $10M mark since he's historically run a surplus?
Yankee151
Hot Girl Summer
Like I think you can even see that BA's projected balanced of -19m is BECAUSE they had 20m in playoff revenue the past season. They had a balance of $25mm at the end of last year, they made $20mm in the playoffs with a profit of $15mm but now they cant rely on that 20mm again this year (since they may make less in the playoffs or not make them at all) so they currently sit at a negative balance. You are correct that playoff revenue doesnt factor into the current balance because it'd be bad accounting to count on money you dont know ur gonna make yet.
Yankee, the playoff money helps your starting balance for the following year (i.e. it helps with revenue sharing and cash). If I don't make the playoffs, maybe the revenue sharing guts my cash and I'm lolpoor.
Regular season ends
Starting balance (10M)
+revenues
- expenses
Final regular season balance.
+playoff revenue (0 if you don't make it)
Final season balance
Fast forward two days and we start the off-season
Final season balance
-revenue sharing
-cash from owner
=cash + money to cover misc player expenses (I.E. starting balance)
+ Revenue (first day of off-season this is only media)
- Exenses (first day of off-season this is only scouting/dev)
- misc. player expenses
Total Balance
-cash
Season Profit/Loss (after one off-season day of course)
Regular season ends
Starting balance (10M)
+revenues
- expenses
Final regular season balance.
+playoff revenue (0 if you don't make it)
Final season balance
Fast forward two days and we start the off-season
Final season balance
-revenue sharing
-cash from owner
=cash + money to cover misc player expenses (I.E. starting balance)
+ Revenue (first day of off-season this is only media)
- Exenses (first day of off-season this is only scouting/dev)
- misc. player expenses
Total Balance
-cash
Season Profit/Loss (after one off-season day of course)
Yankee151
Hot Girl Summer
I just disagree that there is no incentive to making the playoffs, if Osick didn't make the playoffs this year he'd be in a worse situation I think, $5mm of his cash would've been used to pay down the loss (his rev would've been 151 to expenses of 156) and thus he'd have $5m less in starting cash this year (see Cairo, Lisbon, LR as other teams who started out with less cash this year) so his proj balance would be even worse (his payroll went up like 2mm as well but that's not really relevant to the macro portion of this
Basically he ended on $25mm(15m profit +10m cash) last year in balance, without the 20 from playoffs he would have $5mm(subtract the 20m he got from playoff revenue and spend 5m of the 10m in cash to pay off the -5mm debt) and thus only that much in cash (Actually even less with rev sharing, he'd start with negative cash).
Playoff revenues don't matter if you aren't running a loss in the regular revenue-expenses department, but it matters if you are.
Basically he ended on $25mm(15m profit +10m cash) last year in balance, without the 20 from playoffs he would have $5mm(subtract the 20m he got from playoff revenue and spend 5m of the 10m in cash to pay off the -5mm debt) and thus only that much in cash (Actually even less with rev sharing, he'd start with negative cash).
Playoff revenues don't matter if you aren't running a loss in the regular revenue-expenses department, but it matters if you are.
So I can send $10M in cash, right?
No, owners are supposed to be out of it. Only way the owner puts money in is if you start with less than $10M and make enough for him to put it back. Osick made $15M in profit last year (excluding cash) so he covered his expenses in the end.
If he had missed the playoffs he would have started with $2M cash and in a hole that would require him to make $165Mish to get out of.
Karl Hungus
Here to fix the cable
Yes. If you trade with someone you can send 10M cash. If you're trying to just send 10M because you think the financial system sucks then whatever. I honestly don't care
I just think it sucks that Osick made the shampionship game and is still facing budgetary problems because his owner took the money. He was profitable last season and he's been capped by his regular season revenue only.
Yankee151
Hot Girl Summer
Right the important thing is that he only made a profit because of playoff revenues, so they are important
Making the playoffs is crucial for teams like BA, and is pretty necessary for teams like Orlando and myself. When you're in 1-3rd throughout the season your attendance is higher. If you do what I did you lose 16% year over year or whatever it was and lose $16M on your budget.
Well I'd get something for it of course, I just know that I'm not ready to compete yet and I'm going to be able to meet my win goals on about 1/3rd of my budget. With IFA being effectively capped, what else would you suggest I do with my budget or cash?
Helsingborg way under performed expectations last season and still made $2M profit. I just don't think it is as sensitive as you make it out to be. Decade long losing streak or something may sink you as fan support and attendance drops, but obviously missing the playoffs doesn't kill you even for a team like Borg.
lol the highest payroll in the league is facing budgetary problems, no wai. His owner looks and sees osick brings in $152 without the playoffs. You can't count on the playoffs, sure his team got hot but wasn't he the 4th seed? So his budget doesn't go up because the playoffs can't be assured and it's where his revenue falls.
But how much revenue did they have? 2M isn't enough to cover the revenue sharing is it?
The cash is also money above your budget. So you have $180mm to spend with $10mm being cash.
Yankee151
Hot Girl Summer
If you want another example look at Buffalo, if he doesn't make the playoffs this year he will lose $5m (and start the next year with $5m in cash +/- rev sharing), if he does he will surely make a profit and not need to dip into his cash to pay down his debt in regular revenue to expenses. These things happen when ur payroll is 85% (eyeballing) of your budget, if you dont bring in the revenue you're gonna bring in a loss.
So for teams who do not have the talent to compete yet, and only need about 30% of their budget to meat their revenue expectations, what would you suggest they do with the rest?
Lol my budget was lowered after making the ship.
Here is the deal. They base the budgets on the revenue they can expect which is regular season. IF you cut it close like osick has, you must make the playoffs to make sure you don't start out in the hole the next year.
Yes it is fair for osick to be strained, any team run like a business would which is what we have the settings as. His expenses are $20M higher than his revenue.
Where is this hard to understand?
Yes it is fair for osick to be strained, any team run like a business would which is what we have the settings as. His expenses are $20M higher than his revenue.
Where is this hard to understand?
What was your regular season seed that year out of curiosity? This is my point that the regular season place seems to be what matters, not how you do in the playoffs since you can't keep the excess money anyway.
Yankee151
Hot Girl Summer
If he misses the playoffs again he will lose $7m in cash plus rev sharing. He had enough budget room ($2m in profit+$10m in cash) to squeeze out a profit and keep $10m for the next year. If we up cash to $20m now Orlando gets $10.5mm or something since that is what was left over after rev sharing
I understand that. What I don't understand is the fact that he made the championship game and is still strained. Not making the playoffs and making the championship game makes a max difference of $8M on that strain, but he was going to be strained either way.
Spend it on IFA or eating salaries. Again there are limitations at work here, we can only do so much without coding a new game. Figure out what you want to do with the rest.
I can manipulate this in a ton of ways, but I can't change what budgets are based on without adding a wildcard in owners.
I like how ya'll are telling me "the deal" now when nobody had a fucking clue how budgets even work until I showed you this morning. Please explain more to me what the deal is.
Yankee151
Hot Girl Summer
Okay TLDR
Playoffs dont matter for budget if you make them, however if you DONT make them and are running a deficit that your cash CANNOT COVER you will be running a negative balance the following year. Even if your budget isnt changed very much (see Bruin, loss of 1m, budget dropped by like 200k) the following a year, a negative balance the year after will cause it to drop again. It's a multi year thing if you miss the playoffs, thats why they are important. Trust me if Osick didn't make the playoffs he'd be in a much worse spot
Playoffs dont matter for budget if you make them, however if you DONT make them and are running a deficit that your cash CANNOT COVER you will be running a negative balance the following year. Even if your budget isnt changed very much (see Bruin, loss of 1m, budget dropped by like 200k) the following a year, a negative balance the year after will cause it to drop again. It's a multi year thing if you miss the playoffs, thats why they are important. Trust me if Osick didn't make the playoffs he'd be in a much worse spot