Interesting article on Deadspin about NBA teams accounting practices.

[TBonewannabe]

http://deadspin.com/5816870/exclusive-how-and-why-an-nba-team-makes-a-7-million-profit-look-like-a-28-million-loss

Interesting that owners actually depreciate the athletes. Athletes are considered a depreciable asset instead of an employee. I wonder if the athlete gets to depreciate himself on his taxes.

 

[patdog]

The author even admitted he was wrong about the loss on player contracts. But he doesn't realize he's wrong about trying to compare tax income to book income. The depreciation of the cost of acquiring the team is a tax deduction but doesn't affect book income. A simple look at the cash flow statements shows that the Nets were a financial disaster in those years. Any business wants to generate cash from its operating activities and use cash in its investing activities (financing can go either way). The Nets have huge CASH losses in all 3 years. And those are REAL losses.

 

[ckDOG]

Funny how he tries to pick apart the Income Statement and paint the picture that he wants and completely ignores the Statement of Cash Flows. If you are losing cash, you are losing cash - most of the teams are definitely doing that.