Derby could still be RELEGATED from Championship this season as EFL say they will work to impose points deduction ‘as soon as reasonably possible’ after winning appeal to find club did breach Financial Fair Play rules
- Derby escaped relegation to League One on the final day with a dramatic draw
- Wayne Rooney’s side drew 3-3 with Sheffield Wednesday, who were relegated
- Wycombe Wanderers and Rotherham United were the other sides to go down
- But the EFL could sanction Derby due to a breach of Financial Fair Play rules
- The league say they will push to apply sanctions for this season and not next
- A fine or points deduction could be applied – and the latter enforced this season would see the Rams relegated from the Championship after all
The EFL will push for sanctions against Derby County ‘as soon as reasonably possible’ after the Championship club were found in breach of financial fair play rules.
As revealed by Sportsmail on Monday night, Wayne Rooney’s team could yet be relegated into League One if the EFL succeed in imposing a points deduction this season.
Both Derby and the EFL confirmed the news on Tuesday lunchtime with the Rams found in breach of league rules regarding their accounting policies.
Derby could be relegated from the Championship after the EFL (pictured right is chairman Rick Parry) won its appeal to find the Rams in breach of Financial Fair Play
Sportsmail broke the news on Monday that the EFL had won their appeal to find Derby in breach of profit and sustainability rules.
And a statement released by the league said: ‘An Independent League Arbitration Panel has allowed the EFL’s appeal against the outcome of an independent Disciplinary Commission in respect of misconduct charges brought against Derby County.
‘The panel concluded that the Disciplinary Commission was wrong to dismiss the League’s expert accountancy evidence, which demonstrated that the Club’s policy regarding the amortisation of player registrations was contrary to standard accounting rules.
‘More specifically, the panel determined that the Club’s policy was not in accordance with accounting standard FRS102 because it failed to accurately reflect the manner in which the Club takes the benefit of player registrations over the lifetime of a player’s contract.
Derby manager Wayne Rooney celebrated his side’s Championship survival on Saturday
‘The original Disciplinary Commission had already concluded that the Club did not adequately disclose in its financial statements the nature and or effect of its change in accounting policy, and there has been no appeal against that decision.
‘The Club and EFL will now have the opportunity to make submissions on the appropriate sanction arising out of those breaches.
‘Despite media speculation there is no definitive timescale for a determination on sanction though the League will press for a decision as soon as reasonably possible and will provide a further update at the appropriate time.’
Wycombe would be restored to the Championship if Derby were hit with a points deduction
PAST POINT DEDUCTIONS
2000: Chesterfield deducted nine points for financial irregularities — including not paying transfer fees and under-reporting gate receipts.
2002: Boston United deducted four points for misleading FA over player wages.
2004: Cambridge become the first of 16 clubs to be deducted 10 points for entering administration: Wrexham (2004), Boston (2006), Rotherham (2006 and 2007), Leeds (2006), Luton, Bournemouth (both 2007), Darlington, Stockport (both 2008), Southampton, Crystal Palace (both 2009), Plymouth (2010), Port Vale, Portsmouth (both 2011), Aldershot and Coventry (both 2012).
2007: Leeds are the first club to be docked points (15) for leaving administration without a Company Voluntary Agreement.
2008: Three League Two clubs are fined for breaching the same EFL requirement. Bournemouth and Rotherham are each fined 17 points and Luton lose 20 points. They are later docked a further 10 points.
2009: Portsmouth are the first Premier League side to lose points (nine) for entering administration. They’re given a 10-point deduction in the 2011-12 season and in 2012-13 are docked another 10 for leaving administration without a CVA. They are relegated to League Two that season.
2019: Birmingham are the first club to fall foul of the EFL’s profit and sustainability rules for breaching the maximum rolling three-year loss of £39million.
2019: Bury are deducted 12 points for arranging a CVA to ensure payment of the club’s creditors. Membership of the Football League is later withdrawn.
2019: Bolton are docked 12 points for entering administration — the new penalty. Wigan get the same in 2020.
2019: Macclesfield are deducted 17 points for various breaches including postponements following player strikes over non-payment of wages.
2020: Sheffield Wednesday are docked 12 points for breaching FFP rules by overspending, despite selling Hillsborough to owner Dejphon Chansiri for £60m. It’s reduced to six points on appeal but Owls are relegated to League One.
Derby avoided a points deduction last August when an independent disciplinary commission cleared them on two charges brought by the EFL.
One of those related to the £81million sale of Pride Park to a company set up by Morris, allowing the club to turn a loss into a profit.
The other — and the charge upon which the EFL have won their appeal — concerns Derby’s valuation of players.
The club did not use the accepted practice of including the depreciation of player assets in their accounts and sources claim this removed losses in excess of £30million over a three-year period.
An appeal panel has now found Derby guilty of breaching EFL rules, although their punishment is yet to be determined by an independent commission.
The timescale on this remains unclear and sources say it could be that they escape with a fine for the breach of accountancy practice.
However, sources state the second part of the process will involve the restatement of Derby’s books using the correct method of player amortisation.
If it is found their losses are beyond the threshold of £39m over the three-year period allowed within EFL rules, another charge would be brought. This is where the EFL face a race against time.
Some senior figures within the EFL believe the case has been allowed to drag on for too long, especially given Derby were charged in January of last year, not long after Sheffield Wednesday were charged with financial breaches.
Wednesday were subsequently docked 12 points — reduced to six on appeal — and that proved the difference in relegating them following their draw at Derby on Saturday.
There is a frustration at the EFL and among some of their member clubs that Derby have avoided sanction so far.
There is a precedent in relegating teams after a season has finished. Macclesfield Town were demoted from the EFL last year when they were handed a retrospective points deduction in relation to the payment of player wages.
This latest twist in Derby’s battle against the EFL over Financial Fair Play leaves the future of the club in even greater doubt, with Morris desperate to sell.
Spanish businessman Erik Alonso has agreed a deal to buy the club but has so far been unable to produce funds when asked by the EFL.
The deal includes an initial payment of £2.5m to Morris, followed by £2.5m in 12 months —and taking on debts of more than £40m.
Sportsmail has been told that Derby – owned by Mel Morris (above) – did not follow accepted practice by including the depreciation of player assets in their accounts