CHL minimum wage lawsuit reveals clubs' financials

[PeteMoss]

Originally Posted by Lord Carnage

?!? Don't even see how that makes sense... ?!?

They'll get paid their minimum wage wherever they play. What difference is it whether they sell in one city or another... well, i guess different provinces have different minimum wages? OK - you win that one...


The players are provided the opportunity to play in the CHL to further develop their game and hopefully make it into the NHL. The teams are providing things for the players to assist with that, and to make their time in the league easier. It really isn't supposed to be about money at this level. The league has a scholarship program set up (that could be improved) to assist those who don't make it to the big leagues.

Not sure what the expectation is here. The players are being taken care of in exchange for working on improving their level of play in a game they love while they try and get to the NHL. The CHL is not a job - it is an opportunity.

What exactly is the difference between this and the NHL. I'm sure NHL owners would love to convince players that playing in the NHL is a big opportunity and they shouldn't get paid. But the players have a union so they can't screw them around like crazy. CHL players are in and out of the league so fast that getting any type of players representation is out of the question so they get hosed.

[Locke]

Originally Posted by PeteMoss

Shocking turn of events that some posters are pro-owners even when the players are only getting paid $100/week plus a scholarship that may be completely useless to some of them.

I'm sorry, I fail to see how a scholarship is completely useless?

They play hockey.

In return they get paid, albeit poorly I wont argue that, and they're given the opportunity to get an education.

[Locke]

Originally Posted by PeteMoss

From what I've read - these figures are all based on tax returns. As you know, taxable income <> accounting income.

Keep in mind with the Knights the owners are also employees so you can pull funds out of the business as wages or bonuses to show what you want to show.

But these franchises are like pro franchises in that the gains tend to come from appreciation in value rather than income.

All very true.

But again, this instance is disingenuous.

They took the best team's best year and hollered from the rooftops about how much money they make.

They may not be wrong, and again, the players should probably be paid more than they are, but be real about it. What happens if the London Knights slump for 5-7 years? Are the players willing to take a pay-cut then?

[sureLoss]

Winterhawks tax return:

[The Familia]

I don't see the issue. Kids have to PAY to play hockey when they are younger. If they are good enough and decide to pursue it further, they enter the CHL and come out even (don't have to pay, are not being paid. In fact they come out on top as they receive a stipend and free education). If they are good enough to make the NHL then they will get PAID. Seems like a fair chain of events to me. At the end of the day they are playing a sport. They are not critical to the survival of mankind. If they don't like it, they are free to drop out and join the rest of society either working or going to university. I don't feel CHL players should be paid a penny above free education and basic necessities while on the road (food and housing).

[Jay Random]

Originally Posted by PeteMoss

But these franchises are like pro franchises in that the gains tend to come from appreciation in value rather than income.

Appreciation in value does not normally occur unless there is an expectation of future income.

Of course, it does sometimes happen that a person invests in a business that is losing money, knowing it will continue to lose money, but hoping to sell his interest in the future and profit by capital gains. Such a person, in economics, is technically known as a ‘fool’. The branch of economic knowledge concerning this phenomenon (and related things like pyramid schemes) is called ‘greater fool theory’. This label pretty nearly tells you all you need to know about it.

[Alberta_Beef]

Originally Posted by sureLoss

Winterhawks tax return:

am I correct in reading that as the WinterHawks lost $192k?

[Cecil Terwilliger]

On paper. They have $5.6M in deductions.

[Resolute 14]

Originally Posted by PeteMoss

Shocking turn of events that some posters are pro-owners even when the players are only getting paid $100/week plus a scholarship that may be completely useless to some of them.

And equipment paid for, and tutors/personalized education help, and room and board...

[Alberta_Beef]

Originally Posted by Cecil Terwilliger

On paper. They have $5.6M in deductions.

Deductions don't add to income, they just affect how much you pay in taxes.

[sureLoss]

Originally Posted by Alberta_Beef

am I correct in reading that as the WinterHawks lost $192k?

Yup that is what they are reporting to the IRS.

[Alberta_Beef]

Originally Posted by Resolute 14

And equipment paid for, and tutors/personalized education help, and room and board...

food too I assume

[Jay Random]

Originally Posted by Cecil Terwilliger

On paper. They have $5.6M in deductions.

The other word for deductions is ‘expenses’. Did you think they pocketed every dollar of ticket sales and never had to pay their bills?

[Locke]

Originally Posted by Jay Random

The other word for deductions is ‘expenses’. Did you think they pocketed every dollar of ticket sales and never had to pay their bills?

And then taxes on whatever was left.

[Cecil Terwilliger]

Originally Posted by Jay Random

The other word for deductions is ‘expenses’. Did you think they pocketed every dollar of ticket sales and never had to pay their bills?

Oh yeah, I guess you also believe disney when they say the force awakens lost money...

[Maritime Q-Scout]

is there a reason that the judge required WHL and OHL teams but not QMJHL teams? That seems odd to me.

The issue is with the CHL and you're leaving out around 1/3 of the teams financials. Especially when you have teams like Québec, Moncton, Saint John, Halifax and Gatineau. (on the other hand the Bathurst's of the league would skew the average the other way).

[Jay Random]

Originally Posted by Cecil Terwilliger

Oh yeah, I guess you also believe disney when they say the force awakens lost money...

Hollywood accounting is notorious for ensuring that no film ever shows a net profit. But the studios routinely show net profits, and pay taxes on them.

To use your own example, Disney (for fiscal 2016) showed net profits of $14.686 billion before tax, and paid income taxes of $5.078 billion. They don't fancy having their assets impounded by the IRS. Neither do the Winterhawks.

Nice try at deflection, though. —On second thought, no, it wasn't; it was a terrible try at deflection. All you've shown so far is that you don't understand the difference between gross revenue and net income, and think businesses pocket every penny of the former and should pay income tax on it.

[Cecil Terwilliger]

Originally Posted by Jay Random

Hollywood accounting is notorious for ensuring that no film ever shows a net profit. But the studios routinely show net profits, and pay taxes on them. They don't fancy having their assets impounded by the IRS. Neither do the Winterhawks.

Nice try at deflection, though. —On second thought, no, it wasn't; it was a terrible try at deflection. All you've shown so far is that you don't understand the difference between gross revenue and net income, and think businesses pocket every penny of the former and should pay income tax on it.

You're making some crazy assumptions.

[Jay Random]

Originally Posted by Cecil Terwilliger

You're making some crazy assumptions.

No, if anyone is making crazy assumptions here, you are. Here are my assumptions:

1. When businesses list deductible expenses on their tax returns, it is because they had expenses, which are deductible.

2. When businesses pay income tax, they do so on their net pre-tax income, not on their gross revenues.

3. Anybody who cites the gross revenue as evidence that the business must be making a positive net income, does not understand the basic rules of accounting or taxation.

Now, in which of these assumptions was I at fault?

[Cecil Terwilliger]

what position exactly do you think you're arguing against?