NBA Labor Update

Ken Berger at CBS Sportsline had an article 10 days ago regarding the NBA Players Association response to David Stern’s initial labor proposal. A quick review of Stern’s proposal can be found here.  The big picture is Stern claims that the league will lose about 400 million this season and radical changes must be made to control costs for the owners.  The Players Association believes this figure is inaccurate.  The head of the Players Association, Billy Hunter, said:

“The basis of our objection is just when it comes to general accounting principles,” Hunter said. “We think that there’s been an overstatement, that some of the things that they discount should not be discounted because they relate to non-operating expenses and related parties.”

This should come to no surprise to people studying the business of sports.  As Brad posted last year, Paul Beeston has been quoted as saying:

“Anyone who quotes profits of a baseball club is missing the point. Under generally accepted accounting principles, I can turn a $4 million profit into a $2 million loss and I could get every national accounting firm to agree with me.”

If this is true, the players would seem to have the upper-hand in the labor negotiations.   It will be interesting to see the results from the Players Association investigation of the league’s finances and what their counter proposal will be.

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