Simple Poll -- whose side are you on?

[habitual_hab]

Dissecting the Levitt Report

link

Bettman, in the news conference introducing the (Levitt) report, said, "Actually, we thought the percentage of gross revenue taken up by player salaries was 76%, he [Levitt] said 75%."

Actually, he said no such thing. Levitt said 75% of net revenue, not gross revenue, goes toward total player costs, not just salaries. These are significant differences. What the NHL calls net revenue (a measure it invented all for itself that comes closest to what everyone calls gross profit) is gross revenue net of direct costs -- except for player salaries, as direct a cost as there is for a hockey operation. Other costs, such as travel expenses, insurance, social security, and the like, make up part of the 75% Bettman incorrectly called "player salaries" -- Levitt even includes minor league salaries, which would be fine if minor league revenues were included, but they were not.

An interesting read

 

[codswallop]

But: I'm not going to quibble.

The books that the NHL showed Levitt might have been legitimate but NOT acurate.

How exactly do you know if they were accurate or not? Unless you're in with every CFO and/or chief accountant of every NHL team, or you work for the some department of the government, how could you possibly know?

I certainly don't know. I'm more willing to believe one of the more respected economists in the world, call me crazy. He could have made mistakes or been duped, he's human. It happens. But the possibilities of that are far less with him than with most.

The books didn't say what the NHLPA wanted, now they're crying foul. I don't blame them for doing so; they are in a battle, wanting to gain every advantage. What makes me curious is why the PA has not accepted Mr. Levitt's invitations to discuss the report, or why they have not done their own independent audit of every NHL team. Truthfully, there could be a variety of reasons. But one kinda smacks you in the face, saying the likely reason is that the numbers are close to accurate (or at least there is no material difference).

 

[habitual_hab]

How exactly do you know if they were accurate or not? Unless you're in with every CFO and/or chief accountant of every NHL team, or you work for the some department of the government, how could you possibly know?

I certainly don't know. I'm more willing to believe one of the more respected economists in the world, call me crazy. He could have made mistakes or been duped, he's human. It happens. But the possibilities of that are far less with him than with most.

The books didn't say what the NHLPA wanted, now they're crying foul. I don't blame them for doing so; they are in a battle, wanting to gain every advantage. What makes me curious is why the PA has not accepted Mr. Levitt's invitations to discuss the report, or why they have not done their own independent audit of every NHL team. Truthfully, there could be a variety of reasons. But one kinda smacks you in the face, saying the likely reason is that the numbers are close to accurate (or at least there is no material difference).

Do you have a job? If so, how is your salary stated?

 

[codswallop]

Do you have a job? If so, how is your salary stated?

Time and patience are prescious commodities in these places. Making a point piece by piece is a good way of doing it I'll admit. But it'll save us both the time and aggrivation if you skip to the end, making a point or asking a question relevant to all this.

I have an idea where you're going with this, but I'm not one to assume. So fire away.

 

[habitual_hab]

Time and patience are prescious commodities in these places. Making a point piece by piece is a good way of doing it I'll admit. But it'll save us both the time and aggrivation if you skip to the end, making a point or asking a question relevant to all this.

I have an idea where you're going with this, but I'm not one to assume. So fire away.

Well, Levitt’s 75% player cost ratio includes all player costs, not just salaries - that the NHL includes insurance, per diem expenses, social security, NHL trophy and playoff awards, worker's compensation, pension plan – as player costs, but they are actually benefits, not salaries, and not negotiated between player agents and GMs.

And, the $273 million in operational losses is for hockey operations as isolated entities, not including the joint operations at least 22 teams have with related business entities like arenas and media networks.

 

[codswallop]

Well, Levitt’s 75% player cost ratio includes all player costs, not just salaries - that the NHL includes insurance, per diem expenses, social security, NHL trophy and playoff awards, worker's compensation, pension plan – as player costs, but they are actually benefits, not salaries, and not negotiated between player agents and GMs.

And, the $273 million in operational losses is for hockey operations as isolated entities, not including the joint operations at least 22 teams have with related business entities like arenas and media networks.

I'll refer you to a post in your thread about the report, by victor I believe.

My knowledge of accounting/auditing is limited on such high levels, so my opinion wouldn't mean much one way or the other in terms of how the auditors come by the numbers that they do. But I have read a few articles on that site you linked to before. To me, they seem to read like the "X-Files" of the NHL. Conspiracy and half-truths are the norm for that site. Take it with a heavy dose of salt.

 

[habitual_hab]

It's not surprising how one who is so pro owner can dismiss the article so quickly. Despite the author not being an accountant of Levitt's ability, he clearly raises some very serious doubts about how the NHL states its operational losses and how it arrives at its 75% player cost ratio. Combine that with NHL owners under-reporting revenues, as was clearly shown in the article, and one can see how the NHLPA feels about the NHL's salary cap argument based on its (fictional) 75% player cost ratio.

Of course, if one doesn't like the message, the easiest way to dismiss it is to vilify the messenger (and the presentation) while avoiding the content.

 

[codswallop]

It's not surprising how one who is so pro owner can dismiss the article so quickly. Despite the author not being an accountant of Levitt's ability, he clearly raises some very serious doubts about how the NHL states its operational losses and how it arrives at its 75% player cost ratio. Combine that with NHL owners under-reporting revenues, as was clearly shown in the article, and one can see how the NHLPA feels about the NHL's salary cap argument based on its (fictional) 75% player cost ratio.

Of course, if one doesn't like the message, the easiest way to dismiss it is to vilify the messenger (and the presentation) while avoiding the content.

I didn't avoid the content, that was the problem. I just happen to believe that what he wrote in his article was wrong in many, many ways. Your choice whether to believe that or not. I'm not chalk full of motive...

If you think that I'm pro-owner, then you really have mis-read me this whole time. I'm not on one side or the other. I don't care about blame, though you (like too many others here) have shown me that you do. Both sides share the responsibility for this mess. I don't give a damn about blame, or pulling for one side over the other. Basically because neither side cares enough about the fan for me to actually give a rat's behind how they fare in this dispute. All I want is for the NHL to do well; to give every team the opportunity to be financially healthy as well as competitive on the ice. What they do with the opportunity, that's up to them.

That's it. No more, no less.

 

[habitual_hab]

I didn't avoid the content, that was the problem. I just happen to believe that what he wrote in his article was wrong in many, many ways. Your choice whether to believe that or not. I'm not chalk full of motive...

If you think that I'm pro-owner, then you really have mis-read me this whole time. I'm not on one side or the other. I don't care about blame, though you (like too many others here) have shown me that you do. Both sides share the responsibility for this mess. I don't give a damn about blame, or pulling for one side over the other. Basically because neither side cares enough about the fan for me to actually give a rat's behind how they fare in this dispute. All I want is for the NHL to do well; to give every team the opportunity to be financially healthy as well as competitive on the ice. What they do with the opportunity, that's up to them.

That's it. No more, no less.

My bias is that I'm a Ted Lindsay fan.

I just happen to believe that what he wrote in his article was wrong in many, many ways.

How so? The author raised some very vaild questions/points:

That the $273 million in operational losses is for hockey operations as isolated entities, not including the joint operations at least 22 teams have with related business entities like arenas, other sports franchises, and media networks.

That Levitt’s 75% player cost ratio includes all player costs, not just salaries? - that the NHL includes insurance, per diem expenses, social security, NHL trophy and playoff awards, worker's compensation, pension plan – as player costs, but they are actually benefits, not salaries, and not negotiated between player agents and GMs.

That teams can assign whatever ticket value they want to a seat in a luxury suite in completing the UROs. Levitt's assignment was not to question that, just to make sure it was reported -- he had to force at least one team that controls both a team and its arena (Chicago) to report any luxury suite revenue at all. And remember, we are only dealing with the ticket value of luxury seats -- total revenue received from suites far exceeds that figure (data is not available, but the Rangers' VIP program is a good gauge -- suite-like amenities raise the price of a $154.50 seat to $550).

These are issues that cannot just be flippantly dismissed.

 

[codswallop]

How so? The author raised some very vaild questions/points:

That the $273 million in operational losses is for hockey operations as isolated entities, not including the joint operations at least 22 teams have with related business entities like arenas, other sports franchises, and media networks.

That Levitt’s 75% player cost ratio includes all player costs, not just salaries? - that the NHL includes insurance, per diem expenses, social security, NHL trophy and playoff awards, worker's compensation, pension plan – as player costs, but they are actually benefits, not salaries, and not negotiated between player agents and GMs.

That teams can assign whatever ticket value they want to a seat in a luxury suite in completing the UROs. Levitt's assignment was not to question that, just to make sure it was reported -- he had to force at least one team that controls both a team and its arena (Chicago) to report any luxury suite revenue at all. And remember, we are only dealing with the ticket value of luxury seats -- total revenue received from suites far exceeds that figure (data is not available, but the Rangers' VIP program is a good gauge -- suite-like amenities raise the price of a $154.50 seat to $550).

These are issues that cannot just be flippantly dismissed.

That I believe is a big part of the argument between the two sides. Defining the revenues and expenses; what should be included and what should not be. That's their fight, not mine. If you have a bias to one side or the other, you are more apt to believe their side of the story (ie flippantly dismissing valid arguments coming from the other direction). I'm not an auditor or accounting professional, my opinion of the specifics won't mean much.

Taxes and depreciation actually make the numbers look worse. Even though he correctly leaves them out, that's an argument someone who is pro-owner could possibly throw back at you. It's give and take, still too biased to take that seriously.

And 75% of all player costs is still too much. I cannot think of one business that has survived or could possibly survive with that. That's more of a practicality than anything.

Posters arguing on issues they are ill-equipped to argue about, taking sides in a debate where we actually don't fit in on either side. Everyone's heard the saying about seeing the forest for the trees. Many people here don't see the forest; hell, some of them barely see the trees.

 

[YellHockey*]

Taxes and depreciation actually make the numbers look worse. Even though he correctly leaves them out, that's an argument someone who is pro-owner could possibly throw back at you. It's give and take, still too biased to take that seriously.

Depreciation is a loss only on the books. It doesn't affect cash flows.

And why would the teams be paying taxes if they are losing money?

 

[habitual_hab]

That I believe is a big part of the argument between the two sides. Defining the revenues and expenses; what should be included and what should not be. That's their fight, not mine. If you have a bias to one side or the other, you are more apt to believe their side of the story (ie flippantly dismissing valid arguments coming from the other direction). I'm not an auditor or accounting professional, my opinion of the specifics won't mean much.

Taxes and depreciation actually make the numbers look worse. Even though he correctly leaves them out, that's an argument someone who is pro-owner could possibly throw back at you. It's give and take, still too biased to take that seriously.

And 75% of all player costs is still too much. I cannot think of one business that has survived or could possibly survive with that. That's more of a practicality than anything.

Posters arguing on issues they are ill-equipped to argue about, taking sides in a debate where we actually don't fit in on either side. Everyone's heard the saying about seeing the forest for the trees. Many people here don't see the forest; hell, some of them barely see the trees.

I'm just a simple man who runs a simple small business. I'm no accounting genius - I pay an accountant to do my books - but I know the difference between "net revenue" and "gross revenue". So when Bettman says player salaries are 75% of "gross revenues" and Levitt says 75% of net revenue, not gross revenue, goes toward total player costs, not just salaries, I wonder what game the NHL is playing.

And yes, I am biased. Bettman et al has no respect for what Ted Lindsay built.

 

[codswallop]

I'm just a simple man who runs a simple small business. I'm no accounting genius - I pay an accountant to do my books - but I know the difference between "net revenue" and "gross revenue". So when Bettman says player salaries are 75% of "gross revenues" and Levitt says 75% of net revenue, not gross revenue, goes toward total player costs, not just salaries, I wonder what game the NHL is playing.

And yes, I am biased. Bettman et al has no respect for what Ted Lindsay built.

I don't know if they are playing a game actually.

You can correct me on this if I'm wrong. I don't pay attention to everything Bettman says, same with Goodenow. Same party line that never changes, it gets boring after a while. But Bettman could have simply stated the wrong term, an honest mistake. They happen. Like when Goodenow said something about the NHL paying Levitt $1M. There's no harm done and no hidden agenda if it was just an honest mistake.

But listening to either man is a dangerous proposition at best. They've both spouted enough crap in their press appearences to fertilize a small country. The rhetoric flies on both sides, it has to be taken with that grain of salt.