Audited Numbers Show NBA Lost Over 1.5B over last 5 years

[_nokturnal]

Contraction need to happen.

4 teams need to go.

This...particularly those that have proven to be least profitable over the past 10 years.

Minnesota
Indiana

Ridiculous.

[Sasaki]

Lets just get rid of the Bucks they arent really going anywhere and im sure not too many people would miss them

The Bucks may not have been really relevant in a while, but there's no way one of the older teams in the league would be dumped.

I'd argue in favor of Charlotte and New Orleans, and maayyybbbbeee Sacramento. That's it. Definitely not Minnesota ( they can fill it up if they had a competent front office) or Indiana ( state with very rich basketball tradition).

[MF Doom]

Minnesota
Indiana

Ridiculous.

Scratch those two.

Sacramento

[Iman Shumpert]

Lets just get rid of the Bucks they arent really going anywhere and im sure not too many people would miss them

The Bucks may not have been really relevant in a while, but there's no way one of the older teams in the league would be dumped.

I'd argue in favor of Charlotte and New Orleans, and maayyybbbbeee Sacramento. That's it. Definitely not Minnesota ( they can fill it up if they had a competent front office) or Indiana ( state with very rich basketball tradition).

They had no problem ripping the Sonics out of Seattle.

[Buckeye-NBAFan]

Contraction need to happen.

4 teams need to go.

This...particularly those that have proven to be least profitable over the past 10 years.

The least profitable teams are the Thunder, Nets, Bobcats, Pistons, Hornets, Warriors and Wizards, because they were all recently sold, and most of the purchase price is recorded as operating expenses over some time period.

[hebrewhammer]

fire stern

[Sark]

http://en.wikipedia.org/wiki/Accounting_scandals

You guys are acting like numbers can't be fudged.

[JF5]

2 Teams probably are going to get contracted

that's it.....

[leroydaman]

Auditors are only meant to check if the accounting methods used comply with the accounting standards, they can still easily bs these number up. Really contraction seems like the best idea if these numbers are actually true

Really is this factually correct? Only check accounting methods? Are you an auditor and exactly how many audit have you done? How is there any credibility in an audit if "they can still easily bs these number up?

[ChosenSavior]

Stern sux

[Mindflayer]

If any of you believe the NBA lost this much money in 5 years I have some magic beanstalk beans I am willing to sell for a good price. $100,000 OBO.

Most of these "losses" are accounting loses that prevent the team from paying all the taxes it might be responsible for. The owners get to write off a certain percentage of thier purchase price of the franchise each year. This is the majority of the loses are on probably 5 teams which make up the bulk of the overall losses and account for the numbers the NBA quotes. The problem is that the players do not share any of the windfall when an owner sells a team at a much higher price than he bought it for. If the owners are willing to cut the players in each time a team is sold then their arguement might have more valadity. On paper the owners arguement looks better to the uninformed fan then reality.

I have not read the Forbes article that refutes the owners assertions but the owners did come out and say that Forbes has not seen the real numbers. I challenge the owners to turn over the same data including tax returns they allegedly gave the players union and let a non-bias third party make a dertermination as to actual losses. Only then will we the fan get a true picture.

[NCHeels2008]

I believe Mindflayer is right on; look at the Deadspin article for an example of how you can legally jig the numbers

[Wigginstime]

Auditors are only meant to check if the accounting methods used comply with the accounting standards, they can still easily bs these number up. Really contraction seems like the best idea if these numbers are actually true

Really is this factually correct? Only check accounting methods? Are you an auditor and exactly how many audit have you done? How is there any credibility in an audit if "they can still easily bs these number up?

Depends on the audit. Its typically easy to verify the accounting methods. Verifying the actual expenses is an entire different ball game. I know absolutely nothing about the Denver Nuggets fiances; however, I will use this as an example.

They are owned by Stan Kroenke. The are required to pay certain expenses for the right to play at the Pepsi Center, which, just so happens to be owned by Stan Kroenke. They generate profit from their TV contract with Altitude Sports and Entertainment which just so happens to be owned by.... Stan Kroenke.

With all the various costs and expenditures its not overly difficult for large corporations to "fudge" numbers in their favor. Something as simple as the purchase, sales, and deprecations of capital assets can drastically alter their reported earnings. This becomes further complicate when a corporation is conducting business with other entities that share stakeholders such as seen with various NBA teams. Its hard to justify if the Nuggets are receiving fair value for their TV contract and are paying reasonable expenses to play at Pepsi Center.

Their is a reason why so many large business are able to carry on with scandals totaling in the billions for years before anyone even begins to suspect they are in trouble.

[redux46]

So if you include the 10 or so profitable teams does the NBA still come out negative? Posting the figures only for the unsuccessful teams is only half the picture.

[JF5]

There is no way I believe the number are misconstrued. It's been documented and said over the years by various news outlets, and information from money magazines like Forbes that the NBA has been losing money for some time now.

[Dr Pepper]

IIRC even the players union conceded that at least 10 teams were losing money significantly. Imo if the numbers were a fraud then it'd be a much bigger issue and the players and agents would turn it into one quickly.

[HEATindaHouse]

REVENUE SHARING PROBLEM SOLVED!!!!!!!!!!

[Teen Girl Squad]

As someone with an accounting background, I can see both sides of the argument. Things like depreciation, interest expense etc... are things that are legitimate and not just "accounting tricks," but the thing I want to see is their cash flow statements year to year. Most people don't understand the difference between income and cash flow, using the terms interchangeably when they are quite different.

So much of the financial crisis in America was people/companies who had pumped up asset values and capital gains but had poor cash flow and/or poor liquidity, which any decent accountant will say is the most important accounting documents a entity should care for. I'm assuming a lot of what the players are arguing about is their pay relative to estimated cash flow rather than depreciation/gains on assets/intangible assets. That is not to say all of those things should not be taken into consideration (which is what the players would like to do) but just a complication when arguing over how much money is owed. A legitimate counter from the owners, for example, is that with how quickly stadiums become "obsolete" and need to be replaced/renovated, that depreciation is a very real expense.

[Ditchweed]

Contraction need to happen.

4 teams need to go.

How exactly does that solve the problem? It leaves 19 teams losing money. Also, the buyout would cost the NBA over $1 billion (for three teams, not including NOH).

If you want to contract all losers, there would only be 7 to 8 teams left in the league, and the cost would be roughly $8.5 billion for the buyouts.

I don't think the NBA has that kind of extra money floating around. Easier and better to fix the problem with a hard cap.

[Realmckoy265]

How do operate at a loss like that for ten years? Something isn't right ...