While Liverpool are set to be bystanders in the mad scramble that is transfer deadline day, Chelsea's spending is seemingly far from over.
The Stamford Bridge club, acquired by Todd Boehly and Clearlake Capital last year, have engaged in a spending spree the likes of which the Premier League hasn't seen before.
After landing Mykhailo Mudryk earlier this month there was no slowing down in the approach of Chelsea's new owners. Having been rebuffed in their attempts to lure Argentinian World Cup winner Enzo Fernandez, 21, from Benfica earlier in January the London club have returned ahead of the window closing to try and get their man, bidding over the €120m (£105m) release clause for a player who had been linked with Liverpool for some time.
READ MORE: Julian Ward putting plans in place for transfer window as Liverpool search for successor
READ MORE: Liverpool could miss out on £10m windfall as defender transfer confirmed
Chelsea's approach of signing players on long-term deals to spread the annual cost to the balance sheet through amortisation has pushed boundaries and forced European football's governing body, UEFA, to be reactive and impose regulation that limits deals to being five years and not the seven and eight that Chelsea have been dishing out. That regulation will come later this year and by that time the Chelsea rebuild that Boehly and Clearlake have been financing through investors money will be complete.
For some it is something to be lauded, for others it is a strategy of risk against reward where the potential risks are very clear.
Chelsea are pretty much betting it all that this group of players that they are assembling under Graham Potter will manifest into a juggernaut of domestic and European football in the coming seasons. As an accounting trick it makes sense. Chelsea have assets to sell now and in selling those players they can put transfer fees into accounts as straight profit and not an amortised cost. That means that in selling someone like Conor Gallagher for £40m they are effectively covering their amortised annual costs, and then some, of the players they have already acquired, and likely Fernandez too.
The risk is that it puts a great deal of emphasis on these players being the ones to lead them to new heights. Chelsea sit a place behind Liverpool in 10th and are, like the Reds, facing an enormous task to make the top four and Champions League football next season. While it wouldn't be disastrous for Chelsea financially this year if they did not make the grade there is a real risk of financial tumult if the group that they have assembled/are assembling do not fire as is hoped.
It is a bet for the long run for Chelsea. Long contracts protect value, yes, but they also make it harder and more expensive to move players on who have not achieved what the club need them to. Chelsea will need success and to grow revenue streams in order to ensure that they can continue to invest. While there is a heavy spend in the here and now the sheer volume of deals being struck, the length of such deals and the cost implication of them will mean that, given new regulation from UEFA and changes to Financial Fair Play rules moving forward, that Chelsea will have to be extremely conservative in windows to come, which could put them at a competitive disadvantage if they have got their recruitment wrong these past two windows.
For many Liverpool fans the lack of transfer spend when compared to their rivals has been the major bone of contention with owners Fenway Sports Group and the cause of considerable ire.
The struggles that have existed this season have only served to see that ire grow and FSG, who are mulling their long-term options around whether to sell Liverpool or whether to welcome on board new investors, have been feeling the heat.
The FSG mantra has always been one of sustainable success, where the revenues and the moving on of players - as well as attention to detail on the recruitment side that led the field for some time - are key components in what the club actually spends in the transfer market.
In the wake of Mudryk's €70m (£62m) move to Chelsea from Ukrainian side Shakhtar Donetsk, a signing that saw the London club's spending under the new Boehly/Clearlake Capital regime push the £300m mark, many comparisons have been drawn around what is happening at Stamford Bridge and what is not happening at Anfield. That £300m is set to be closer to £450m by the time the transfer window closes if they get deals done for Fernandez and Brighton & Hove Albion's Moises Caicedo.
When Boehly and Clearlake arrived on the scene in May having won the fierce bidding process following the forced sale of the club by the sanctioned Roman Abramovich, there was the suggestion that the free spending of the Russian's era at Stamford Bridge, one that saw the club end up with some £1bn worth of debt to their former owner's company that was written off, would be replaced by spending that was more conservative due to the impending tightening of Financial Fair Play rules by UEFA.
Boehly, speaking at a conference last year, said: "Financial fair play is starting to get some teeth and that will limit the ability to acquire players at any price.
"UEFA takes it seriously and will continue to take it seriously. [More teeth] means financial penalties and disqualification from sporting competitions."
The arrival of Mudryk saw Chelsea continue to flex their muscles, something that raised eyebrows among the wider football community, especially given the impending signing of Christopher Nkunku next summer and the continued pursuit of Fernandez and Caicedo, another long-rumoured target for Liverpool.
There has a notable pattern to the majority of the deals struck so far.
There is a window of opportunity for Chelsea to spend. The current level of investment in the playing squad is one that simply cannot be sustained under FFP regulations moving forward, nor is it something that Chelsea's owners, who are spending a good chunk of other people's money with this investment, are able to continue to do relentlessly.
It is a bold play, one that will impact Chelsea's balance sheet for a large portion of the next decade. The emphasis has been placed on buying highly-rated young players and placing them on long contracts, keeping them tied to the club and protecting value while also reducing the amortisation figures on their yearly financials.
While the payment structure on some of the deals may be done in one, two or three instalments, likely inside three years, the way the fees are accounted for at the end of the financial year comes down to the transfer fee divided by the number of years on the contract. The amortised costs relate to guaranteed transfer fees only and do not account for add-ons.
Mudryk signed an eight-and-a-half year deal at Stamford Bridge (£62m), Benoit Badiashile (£33m) signed a seven-and-a-half year deal, Wesley Fofana (£70m) signed a seven-year deal, David Datro Fofana (£8m) signed a six-and-a-half year deal and Marc Cucurella (£55m) signed a six-year deal.
Mudryk's annual amortised cost on the balance sheet would appear as £7.3m, while Badiashile's would show as £4.4m. The other deals would see Fofana appear as £10m, Datro Fofana show as £1.2m, and Cucurella show as £9.2m. In total the annual amortisation costs on the balance sheet would show an additional £32.1m, something that Chelsea's owners would be confident of absorbing given they had rid themselves of some amortisation costs that existed on the balance sheet through the sales of the likes of Timo Werner back to RB Leipzig (£9.6m per year amortised cost in Chelsea's accounts), while the loan fee paid for Romelu Lukaku to Inter Milan would offset his amortisation cost. And with Inter picking up his major wages, that would allow for flexibility to bring players in, with those arriving unlikely to command the kind of fees that more experienced players carry.
The sales of the likes of Emerson, Billy Gilmour and Werner can all be accounted for in the accounts, with around £45m brought in that will show on the balance sheet for the 2022/23 accounts.
Boehly and Clearlake chiefs Behdad Eghbali and Jose E. Feliciano are playing the long game with Chelsea and backing their new hires behind the scenes, new man in the dugout and recruitment strategy to give them the edge when competing over the next five to 10 years. It is a bold move but one that comes with considerable risk if the signings that they have made are unable to deliver.
Liverpool will need to revamp their own playing squad when the summer arrives, with doing it beforehand not looking like being something that will come to pass as things stand and as the hours tick away on transfer deadline day.
Chelsea (£162m) had the highest amortisation costs in the Premier League last season, ahead of Manchester City (£146m), Manchester United (£120m), Arsenal (£117m) and Liverpool (£108m), according to figures presented by football finance expert Swiss Ramble back in August. Liverpool's figures have been added to since with the arrival of the likes of Darwin Nunez and Cody Gakpo. Some figures which had accounted towards amortisation will drop off, notably the final £10.6m that was costed for Naby Keita's £53m deal back in 2018.
With record revenues expected when the 2021/22 accounts are published in a few weeks time they have the room to spend, the question will be to what degree they will be willing to do so. While much will depend on structure of payments and how much up front Liverpool would have to shell out, they have more than enough wriggle room for a major rebuild, one that evidenced by this season's struggles is in need in order for the Reds to stave off the plans of their rivals to push them out of the picture.
READ NEXT
Darwin Nunez starts in new role with new-look Liverpool midfield on the cards
- Eight players tipped to sign for Liverpool as transfer deadline nears
Joao Cancelo and Man City have just shown Liverpool exactly what they've done wrong
FSG have £10bn reason to make Liverpool sale decision that John Henry favours
Liverpool transfer deadline day Q&A as links continue over late signings and exits
