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Harvard Business School 9-187-088 Rev. July 24, 1996 Kansas City Zephyrs Baseball Club, Inc. On April 17, 1985, news report Ahern sit down in his office and contemplated a difficult judgment he had to make in the next two days. Two weeks before, Bill had been asked to be an arbitrator in a dispute amid the Owner-Player Committee (OPC, the representatives of the owners of the 26 major league baseball game teams in collective bargaining negotiations) and the Professional Baseball Players Association (PBPA, the players union). A Baseball Accounting Dispute The issue Ahern had to resolve was the profitability of the major league baseball teams. The players felt they should share in the teams get; the owners maintained, however, that most of the teams were actually losing money each year, and they produced financial statements to livelihood that position. The players, who had examined the owners statements, countered that the owners were hiding profits through a number of invoice tricks and that the statements did not accurately reflect the economic reality. Aherns decision on the profitability issue, was important because it would affect the ongoing contract negotiations, especially in the areas of minimum salaries and team contributions to the players pension fund.

On April 9, Ahern met with the OPC and the representatives of the PBPA. They explained they valued him to focus on the finances of the Kansas City Zephyrs Baseball Club, Inc. This floorshow was selected for review because both sides agreed its operations were representative, yet it was a relatively clean and simple example to study: the baseball club entity was not owned by another corporation, and it did not own the stadium the team played in. Furthermore, no head-to-head financial data would have to be revealed because the corporation was publicly owned. Aherns task was to review the Zephyrs financial statements, hear the owners and players arguments, and then pass on a decision as to the profitability... If you want to get a full essay, order it on our website: Orderessay

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