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budgeting for a loss
Post Wed Jul 11, 2018 10:51 am
Posted by snowie on Wed Jul 11, 2018 10:51 am
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can someone explain to me how you can budget for a loss above £2 million in a business, seems crazy to me, I understand making a loss investing in the future but £2 million :shock:

https://www.bbc.co.uk/sport/rugby-league/44793394
Re: budgeting for a loss
Post Wed Jul 11, 2018 11:00 am
Posted by Trinity18 on Wed Jul 11, 2018 11:00 am
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It would depend on the overall spend, £2 million could be nothing in the grand scheme of things. It's a pretty poor write up by the BBC.
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Re: budgeting for a loss
Post Wed Jul 11, 2018 11:03 am
Posted by snowie on Wed Jul 11, 2018 11:03 am
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Trinity18 wrote:
It would depend on the overall spend, £2 million could be nothing in the grand scheme of things. It's a pretty poor write up by the BBC.

here's a better one including £400,000 loss on Odsal stadium valuation

http://www.rugby-league.com/article/528 ... -in-future
Re: budgeting for a loss
Post Wed Jul 11, 2018 11:18 am
Posted by homme vaste on Wed Jul 11, 2018 11:18 am
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A business can budget for anything really, it is just basically what goes into strategy documents/business plans preempting profit/loss. If a organisation makes a £2m profit in 2014, 2015 and 2016 they may look to have a investment/transformation period whereby they invest in facilities/additional resources etc it does not necessarily mean the loss has had a massive financial impact on the organisation.
Re: budgeting for a loss
Post Wed Jul 11, 2018 11:26 am
Posted by bren2k on Wed Jul 11, 2018 11:26 am
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I'm not for a minute suggesting the RFL is well run - or that some of those losses couldn't be avoided; such as Mr Woods big fat pay-off or the costs of the Odsal deal - but from an accounting perspective, it's entirely normal to forecast an in-year loss. At least they appear to have some mitigation - if you don't, that spells real trouble.
Re: budgeting for a loss
Post Wed Jul 11, 2018 11:46 am
Posted by wrencat1873 on Wed Jul 11, 2018 11:46 am
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snowie wrote:
can someone explain to me how you can budget for a loss above £2 million in a business, seems crazy to me, I understand making a loss investing in the future but £2 million :shock:

https://www.bbc.co.uk/sport/rugby-league/44793394


Budgeting for a loss is nothing too unusual for many businesses, especially when they operate on a cyclical level of income (ie, lack of revenue from not staging home internationals) and as long as this is preceded and/or followed by a profitable year then, there is no problem.
However, the write off regarding Odsal is far more interesting.
Should this be put down as being as business decision or, is this in fact giving advantage to an individual club ?
I'm sure that the Bulls fans would say that it's part of the deal but, if so, it's just another shocking decision by the RFL to take on the lease for Odsal.
Also, I wonder just how much they are paying in rent to their landlord (The RFL) ?

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