Books of Barca: Secrets behind transfers

In the world of finance, there's an age-old saying that goes: "If you owe the bank $100 that's your problem. If you owe the bank $100 million, that's the bank's problem." Now if you're wondering how the quote bears relevance with the footballing world it is because Spanish giants Barcelona have pretty much been functioning on this very thin line as they have continued to pummel their finances with big money signings but behind every deal lurks the question of how they have been spending money that supposedly isn't there.

To sum up Barcelona's fiasco, they are reportedly in 1.3 billion Euros worth of debt. Their salary limit, which is the amount they are allowed to spend and invest which is determined by La Liga after analysing the club's audited accounts, stands at a jaw-dropping -144 million Euros. 

Yes, you read that right. Negative one hundred and forty-four million Euros. No wonder their president was quoted saying that the club was "clinically dead".

Despite all these supposed constraints, Barcelona have recently signed Kessie and Christensen. They followed it up with a 58 million dollar signing of former Leeds winger Raphinha. Moreover, it is presumed that the announcement of Robert Lewandowski is soon to follow. They renewed the contract of French winger Dembele. How can they pay for all these in such a situation?

The short answer is that they cannot. At Least not yet.

Kessie and Christensen were presented this past week, but they can't be registered because Barcelona don't meet the league's financial fair play criteria. They are not within the salary limits LaLiga sets, in other words, and those budget deficits prevent their new players from formally joining the squad.
For now, anyway. They will eventually, or at least that's the aspiration and the expectation. This is why "they can't" isn't the answer, even if it's strictly speaking about the present. 

There are a few ways a club that appears unable to sign any players, actually can end up signing them anyways. 

Firstly, it is about the general financial state of the club, something that always has to be balanced with the competitive state of the club in the short, mid and long-term. Another is the ability of the club to hit budgetary targets, which is why there was a rush to bring in the first of the now-famous "economic levers". The third is the ability of the club to fulfil the league's criteria to sign.

To make up for all the shortcomings, Laporta has taken some shrewd steps which he probably wouldn't have opted for in an ideal world but hey, nothing about Barcelona is ideal these days.

Laporta was permitted to sell club assets by the Barca members' assembly last June as they targeted investment funds capable of providing financing so that operations could run as normal in the short term.

They sold the first package of financial assets before striking a 207 million euros deal with an investment group last month.

They sold 10% of its La Liga TV rights, which ensured that they turned a profit at the end of the 2021-22 financial year.

A second economic lever is now being worked on to raise funds so that Barca no longer exceeds La Liga's salary limit, with another 15 per cent of their TV rights set to be sold in return for an extra of almost €300m.

The Blaugrana are also selling 49.9% of the shares of the Barca Licensing and Merchandising company, which will bring their total revenue for the summer beyond €600m and allow them to register new players for the 2022-23 season.

Moreover, they had taken steps to reduce their total wages paid to players by asking most of the players to take wage cuts and even deferred wages of certain players, Frenkie de Jong being one of them who reportedly has over 17 million euros wages, yet to be paid.

All in all, these are the technicalities through which Barcelona can sign new players. They will get away with it. Now whether a club of this stature should be functioning in this manner is an entirely different conversation. However, the situation is undoubtedly messy. Very very messy, and I don't mean Leo.