One question no one has asked in all of this...

[SuperUnknown]

Horcoff is a guy that can excel in a no contact, bigger rink league. But thats not the NHL. Thats why hes lighting up SEL and very mediocre in Edmonton.

Don't get me wrong, I think Horcoff is a decent player, but it kind of takes credit away from the SEL when he's one of the stars there. C'mon!

 

[CarlRacki]

Because then the can of worms as to what is revenue gets opened.

The NFL and NBA answered that question. It's hardly a can of worms.

 

[OilerFan4Life]

Don't get me wrong, I think Horcoff is a decent player, but it kind of takes credit away from the SEL when he's one of the stars there. C'mon!

lol...Ill give you that.

 

[vanlady]

Again, as I said. 53% of revenues.

The teams and players can sit down and define hockey-related revenues. Once that's done, a percentage of revenue that will be allocated to players can be agreed upon. Until now, revenues have been murky because the league has had no reason to show to the world their books since it hasn't been an issue.

With a cap, it becomes a big issue and the books will be opened and an auditor that both sides select will go over the books to tally up what has been agreed upon will constitute hockey-related revenues. Owners won't be able to hide what has been mutually agreed upon will make up those revenues because the auditor will know what to look for. If the auditor determines an owner does somehow manage to hide revenues, the players will be able to take them to the cleaners.

I suggest you talk to an accountant. I did, I talked to a woman that leads a team of forensic auditors for KPMG, she audits books in cases of bankruptcy, unfreindly takeovers and Revenue Canada tax audits. In her words, the task would be hurculian, if not impossible. The system you would require is a team of forensic auditors that would out number the players in the NHL to determine a reasonalbly accurarate number and even then if an owner is bent on hiding revenue, there is very little an auditor can do to find it. As she pointed out, how many millionaires go bankrupt, but are still millionaires a year later.

 

[SuperUnknown]

I suggest you talk to an accountant. I did, I talked to a woman that leads a team of forensic auditors for KPMG, she audits books in cases of bankruptcy, unfreindly takeovers and Revenue Canada tax audits. In her words, the task would be hurculian, if not impossible. The system you would require is a team of forensic auditors that would out number the players in the NHL to determine a reasonalbly accurarate number and even then if an owner is bent on hiding revenue, there is very little an auditor can do to find it. As she pointed out, how many millionaires go bankrupt, but are still millionaires a year later.

Then why audit at all any company? Why provide audited financial statements? Why do people invest in the stock market at all? I mean, if she told you that basically you can't get anything accurate at all because it's an herculean task?

Also, how do the other leagues manage to do it (NFL and NBA)? They outsourced to India?

Heck, if *I* (alone mind you) was to have a full year to verify a team's financial statements and operations to look for hidden revenues, I would find anything meaningfull that's missing. We're not talking about assessing an individual's revenues (which is significantly harder), we're talking about assessing *one* business (each franchise) revenues...

 

[CarlRacki]

I suggest you talk to an accountant. I did, I talked to a woman that leads a team of forensic auditors for KPMG, she audits books in cases of bankruptcy, unfreindly takeovers and Revenue Canada tax audits. In her words, the task would be hurculian, if not impossible. The system you would require is a team of forensic auditors that would out number the players in the NHL to determine a reasonalbly accurarate number and even then if an owner is bent on hiding revenue, there is very little an auditor can do to find it. As she pointed out, how many millionaires go bankrupt, but are still millionaires a year later.

That's just silly. If they can do it every year for 32 NFL teams and 30 NBA teams, I'm pretty sure they can manage it in the NHL.

 

[Wetcoaster]

The NFL and NBA answered that question. It's hardly a can of worms.

Not so. It is real problem currently for the NFL and NFLPA.

According to Gene Upshaw (Goodenow's counterpart) it has not worked well. The NFLPA has stated that they are not prepared to renew the cap and that once it is gone it is not coming back.

This year the NFLPA went through the NFL books with a fine-tooth comb (at least the NFL owners give access unlike the NHL owners) and found over $100 million in undeclared revenue. This resulted in the salary cap rising from predicted $78.7 million per team for this season to $80.6 million from the previous season cap of $75.1 million.

Upshaw has complained that some big revenue teams are using accounting sleight of hand to move revenues out of the shared revenue pools and thereby reducing the money. Some of the small market teams (such as the Steelers) have also made the same complaint.

Upshaw is worried about the skewing of the system to the eight most powerful teams. "When we started this process, there were 14 teams above the average and 14 below it, and everyone was close enough to keep things fair,'' the executive director of the NFL Players Association said. "Now we have eight haves and 24 have-nots and the haves are getting a discount on everything.''

Under the current NFL CBA agreement, there will be no salary cap for the 2007 season.

"We don't have that much time, because if we actually get to that uncapped year, it's over,'' Upshaw said. "We'll never get the cap back once it goes away.''

Since the first contract with free agency and the salary cap took effect in 1994, it always has been extended before it expired to avoid the uncapped year. It was last extended in 2001.

Upshaw noted that the high-revenue teams such as Washington and Dallas get more local money, which is not part of the league's revenue sharing. The union is asking that high-revenue teams contribute more money to the shared pool, a move that would also increase the salary cap and provide more money for players.

"The money that isn't shared has gone from 30 percent (of total revenues) in 1994 to 37 percent today, and with revenues at almost $6 billion, that's a significant amount of money,'' he said. "We've had a good deal for 10 years now, and we want that to go forward, but the model has to change.''

Upshaw also says his union won't agree to an extended CBA with the "defined gross revenues" in the current deal.

Upshaw's presentation impressed Pittsburgh's Dan Rooney, one of the small-market owners who is a proponent of sharing more revenue. Bob Irsay owner of the Coltscontends the disparity is glaring when considering the Colts paid more than 70% of their revenue to salaries in 2003 while richer teams paid roughly 38%. Irsay of the Colts had this to say in complaining about the direction of revenue sharing:

"As an owner," Irsay says, "you're faced with, 'Are you going to become the Florida Marlins?' Will you look at it strictly in the short-term business sense, or are you going to make a long-term investment and want to win?"

The high revenue teams disagree with the Upshaw/Rooney and Irsay approach

Note the key to the NFL system is REVENUE SHARING and this is something the NHL owners refuse to embrace in any meaningful way.

 

[Wetcoaster]

I suggest you talk to an accountant. I did, I talked to a woman that leads a team of forensic auditors for KPMG, she audits books in cases of bankruptcy, unfreindly takeovers and Revenue Canada tax audits. In her words, the task would be hurculian, if not impossible. The system you would require is a team of forensic auditors that would out number the players in the NHL to determine a reasonalbly accurarate number and even then if an owner is bent on hiding revenue, there is very little an auditor can do to find it. As she pointed out, how many millionaires go bankrupt, but are still millionaires a year later.

I disagree. I have talked to a several of the top forensic accountants about this and they say it can be done as long as the NHL teams cooperate. It would not be Herculian nor impossible -it is done all the time.

The NFL does this and this year put a real effort into their review of the books and came up with over $100 million in additional revenue. That money was added to this season's salary cap.

 

[OilerFan4Life]

Actually in the NFL they hire literally 1000's of people to go over teams numbers. Example- The Denver Broncos last year got hit with a huge fine, for going over the salary cap in 1998. The NHL could not afford to hire people to go over teams spendings. So therefore even with a cap some team (cough*cough* Rangers cough*) will manage to go over.

 

[CarlRacki]

Not so. It is real problem currently for the NFL and NFLPA.

According to Gene Upshaw (Goodenow's counterpart) it has not worked well. The NFLPA has stated that they are not prepared to renew the cap and that once it is gone it is not coming back.

This year the NFLPA went through the NFL books with a fine-tooth comb (at least the NFL owners give access unlike the NHL owners) and found over $100 million in undeclared revenue. This resulted in the salary cap rising from predicted $78.7 million per team for this season to $80.6 million from the previous season cap of $75.1 million.

Upshaw has complained that some big revenue teams are using accounting sleight of hand to move revenues out of the shared revenue pools and thereby reducing the money. Some of the small market teams (such as the Steelers) have also made the same complaint.

Upshaw is worried about the skewing of the system to the eight most powerful teams. "When we started this process, there were 14 teams above the average and 14 below it, and everyone was close enough to keep things fair,'' the executive director of the NFL Players Association said. "Now we have eight haves and 24 have-nots and the haves are getting a discount on everything.''

Under the current NFL CBA agreement, there will be no salary cap for the 2007 season.

"We don't have that much time, because if we actually get to that uncapped year, it's over,'' Upshaw said. "We'll never get the cap back once it goes away.''

Since the first contract with free agency and the salary cap took effect in 1994, it always has been extended before it expired to avoid the uncapped year. It was last extended in 2001.

Upshaw noted that the high-revenue teams such as Washington and Dallas get more local money, which is not part of the league's revenue sharing. The union is asking that high-revenue teams contribute more money to the shared pool, a move that would also increase the salary cap and provide more money for players.

"The money that isn't shared has gone from 30 percent (of total revenues) in 1994 to 37 percent today, and with revenues at almost $6 billion, that's a significant amount of money,'' he said. "We've had a good deal for 10 years now, and we want that to go forward, but the model has to change.''

Upshaw also says his union won't agree to an extended CBA with the "defined gross revenues" in the current deal.

Upshaw's presentation impressed Pittsburgh's Dan Rooney, one of the small-market owners who is a proponent of sharing more revenue. Bob Irsay owner of the Coltscontends the disparity is glaring when considering the Colts paid more than 70% of their revenue to salaries in 2003 while richer teams paid roughly 38%. Irsay of the Colts had this to say in complaining about the direction of revenue sharing:

"As an owner," Irsay says, "you're faced with, 'Are you going to become the Florida Marlins?' Will you look at it strictly in the short-term business sense, or are you going to make a long-term investment and want to win?"

The high revenue teams disagree with the Upshaw/Rooney and Irsay approach

Note the key to the NFL system is REVENUE SHARING and this is something the NHL owners refuse to embrace in any meaningful way.

1. Talk about misleading. Upshaw has not said the cap doesn't work well. Quite the opposite, in fact. He wants to extend the current cap through 2011. What he wants to change is the defintion of shared revenue. The NFLPA, as expected, wants the definition of revenue expanded. The NHLPA could have these same negotiations once they agree to a cap.
Here's something Upshaw said about the cap two years ago:
"We agreed to a cap on salaries, sure, but at the same time we negotiated that about 65% to 70% of all shared revenues be designated for the players. That allows us to get a fair share of the pie."
(NFLPA Executive Director Gene Upshaw, January 27, 2003)

2. If the NFLPA went through the books, found additional revenue and got the cap raised, isn't that just proof the system of audits can and does work?
3. There have been other scheduled "uncapped" seasons before. The league has extended the CBA every time before it's actually gotten that far and it's highly likely it will again.
4. Don't the remarks of the Pittsburgh and Indy owners prove my long-held contention that revenue sharing alone does not make all things equal and that it's the cap, and not the revenue sharing, that provides the competitive balance in the NFL?