Everton have been hit with the largest points deduction in Premier League history.

The Toffees have lost 10 points after they were found to have breached profitability and sustainability rules for the three-year period ending in the 2021-22 season.

Here, we take a look at five big questions as the Merseyside club aims to overturn the penalty.

Are Everton guilty?

The Premier League says the club accepts it was in breach of the rules.

Everton dispute the extent of the breach and contend that the punishment – a record points deduction – is disproportionate.

They also say mitigating factors – such as the deflationary effect of COVID on transfer fees – were not taken sufficiently into account.

What happens now?

Everton plan to appeal.

This will be heard by another independent panel – not the same people who brought forward today’s verdict.

Everton fans should be aware that some of the points the club is making in its defence have already been addressed in today’s written reasons for the points deduction.

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Everton FC: 10-point penalty ‘wholly unjust’

Will Everton be relegated?

They have every chance of avoiding that fate. Manager Sean Dyche has the team in good form.

Even after the points deduction, Everton are only two points short of climbing out of the relegation zone. They could in theory achieve that in their next match against Manchester United on 26 November.

What does it mean for Manchester City?

Everton’s statement includes their intention to “monitor with great interest the decisions made in any other cases”.

Be in doubt, they mean above all Manchester City, who are accused of more than 100 breaches of financial rules over a nine-year period from 2009.

City deny every accusation, and have sounded bullish and confident in all their pronouncements on the case.

But the Everton ruling can only make them more nervous, both because of its severity and because the independent panel was notably dismissive of some factors which Everton put forward as mitigation.

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What’s the bigger picture?

The Premier League is determined to keep its clubs sustainable for what will be an increasingly challenging environment.

The world’s biggest club competition is a magnet for mega-rich would-be owners, including nation states. Changes in ownership are attracting ever-increasing scrutiny inside and outside football.

Politicians were quick today to urge the government to speed up plans for an independent regulator.