820 Kar 1:057. Accurate Records

Link to law: http://www.lrc.ky.gov/kar/820/001/057reg.htm
Published: 2015

PUBLIC PROTECTION CABINET

Department of Charitable Gaming

(Amendment)

 

      820 KAR 1:057. Accurate records.

 

      RELATES

TO: KRS 238.550(5), 238.560(2)

      STATUTORY

AUTHORITY: KRS 238.515(4), (9), 238.550(3)

      NECESSITY,

FUNCTION, AND CONFORMITY: KRS 238.515(4) and 238.550(5) authorize the department[office]

to establish and enforce standards for accounting, recordkeeping, and reporting

to the department[office] to ensure charitable gaming receipts

are counted and reported. This administrative regulation establishes the

minimum requirements for accurate records.

 

      Section

1. Bank Account and Records. (1) A licensed charitable gaming organization

shall maintain a single bank account for charitable gaming receipts. This

account shall be separate from any other account maintained by the

organization.

      (2)

Disbursements for charitable gaming expenses and charitable donations shall be

made by check or electronic fund transfer directly from the charitable gaming

account.

      (3)

All receipts from each gaming occasion shall be deposited by the second

business day following the occasion at which they were received. The deposit

for each occasion shall be made separately and shall not be combined with the

deposit from any other occasion.

      (4)

All types of deposits, including startup cash, bad checks collected and check

collection fees, progressive game carry forward, and adjusted gross receipts,

shall be listed separately on the deposit reconciliation sheet, and the deposit

slip, if possible. Each individual check shall be listed separately on the

deposit slip. If a register tape is run listing the amounts of the individual

checks, it may be attached to the deposit slip. Total cash and coins shall be

listed separately. The organization shall keep a copy of the deposit slip.

      (5)

Checks that have been returned for insufficient funds that have not been

collected shall be retained by the organization for three (3) years following

the close of the calendar year in which the check was issued. If the check has

been turned over to someone else for collection, the organization shall keep a

copy of the check with information regarding the person collecting the check.

      (6)

Monthly bank statements and reconciliations for all accounts shall be

maintained for three (3) years following the close of a calendar year.

      (7)

Copies of the fronts and backs of checks from any account into which charitable

gaming funds are deposited or transferred shall be provided to the department[office]

upon request.

      (8)

Gross receipts shall include the money received from the sale of raffle

tickets, bingo cards or faces, pickle jars, bonanza balls, or hot balls,

card-minding devices, pulltabs, electronic pulltab devices and electronic

pulltabs, charity fundraising event games, special limited charity

fundraising event games, bad check collections, credit card fees and reasonable

check collection fees minus bad checks.

 

      Section

2. Start-up Cash. (1) If the source of start-up cash is not the charitable

gaming account, the source of the start-up cash shall be identified on the

gaming occasion sheet and signed by the chairperson.

      (2)

Start-up cash from one (1) organization shall not be commingled with the

start-up cash from another organization. The start-up cash shall be identified

on the check withdrawing the funds and on the deposit slip, if possible.

 

      Section

3. Organization Records. (1) The chief financial officer shall be the custodian

of the gaming records and shall be responsible for ensuring that the records

are accurate, complete, and maintained regularly for inspection by the department[office].

      (2)

An organization that hand-writes data and later enters the information onto

another form or computer program shall retain the hand-written records along

with the other form or computer generated record.

      (3)

Organizations shall prepare and maintain accurate and adequate corporate or

other organizational records including articles of incorporation, minutes of

board of directors meetings, and resolutions.

      (4)

Organizations shall maintain detailed records of all expenditures made in

furtherance of its charitable purpose, including all charitable contributions.

      (5)

All records shall be made available for inspection and audit at the request of

the department[office].

      (6)

Any organization’s records, or copies of those records, deemed necessary to

complete an inspection, audit, or investigation may be retained by the department[office]

or its employees or agents. The department[office] shall provide

a written receipt of the records at the time of removal.

      (7)

Organizations shall provide records requested by the department[office],

or any of its employees, within ten (10) calendar days, unless a longer

response time is allowed by the request.

      (8)

An organization shall perform an inventory and obtain permission of the department[office]

before destroying a bulk amount of gaming supplies. The gaming supplies shall

be destroyed by burning in compliance with state and federal law, shredding,

destroying or defacing in some manner to prevent reuse of any pulltab, flare,

prize board, seal card, bingo paper or any portion thereof. An organization

may also donate gaming supplies to the department for demonstration and

training purposes if the department so requests.

      (9)

When an organization ceases to game, the organization shall:

      (a)

Perform a final inventory;

      (b)1.

Return all unused product to a distributor;

      2.

Donate the product to another organization with the permission of the department

or,

if another organization does not want the gaming supplies, they may be donated

to the department, upon request, for training and demonstration purposes[office]; or

      3.

Destroy the product with the permission of the department[office]; and

      (c)

Spend or disburse the charitable gaming funds consistent with its charitable

purpose.

 

SCOTT

JONES, Commissioner   

AMBROSE

WILSON IV, Secretary

      APPROVED

BY AGENCY: August 12, 2015

      FILED

WITH LRC: August 14, 2015 at 11 a.m.

      PUBLIC

HEARING AND PUBLIC COMMENT PERIOD: A public hearing on this administrative

regulation shall be held on September 24, 2015 at 10:30 a.m., Eastern Time at

the Department of Charitable Gaming, 132 Brighton Park Boulevard, Frankfort,

Kentucky 40601. Individuals interested in being heard at this hearing shall notify

this agency in writing by five (5) workdays prior to the hearing of their

intent to attend. If no notification of intent to attend the hearing is

received by that date, the hearing may be canceled. This hearing is open to the

public. Any person who wishes to be heard will be given an opportunity to

comment on the proposed administrative regulation. A transcript of the public

hearing will not be made unless a written request for a transcript is made. If

you do not wish to be heard at the public hearing, you may submit written

comments on the proposed administrative regulation. Written comments shall be

accepted until the end of the calendar day on September 30, 2015. Send written

notification of intent to be heard at the public hearing or written comments on

the proposed administrative regulation to the contact person.

      CONTACT

PERSON: Noelle J. Bailey, General Counsel, Department of Charitable Gaming, 132

Brighton Park Boulevard, Frankfort, Kentucky 40601, phone (502) 573-5528, fax

(502) 573-6625.

 

REGULATORY IMPACT ANALYSIS AND TIERING STATEMENT

 

Contact

person: Noelle J. Bailey

      (1)

Provide a brief summary of:

      (a)

What this administrative regulation does: This administrative regulation establishes standards

for accounting, recordkeeping and reporting by setting the minimum requirements

for accurate records.

      (b)

The necessity of this administrative regulation: This regulation is necessary

to establish the requirements for recordkeeping for charitable gaming

licensees.

      (c)

How this administrative regulation conforms to the content of the authorizing

statutes: The statutory authorities for this regulation are KRS 238.515(4),

(9), 238.550(3). KRS 238.515 (4), and (9) sets forth the powers of the

department to establish standards of accounting, recordkeeping, and reporting

to insure charitable gaming receipts are properly accounted for; and, to "promulgate

administrative regulations which are necessary to carry out the purposes and

intent of [KRS Chapter 238]." This regulation conforms to the statute by

setting out minimum standards for organizations regarding accurate records.

      (d)

How this administrative regulation currently assists or will assist in the

effective administration of the statutes: This administrative regulation

facilitates effective administration of the statutes by providing the

requirements for handling and reporting money obtained in the conduct of

charitable gaming.

      (2)

If this is an amendment to an existing administrative regulation, provide a

brief summary of:

      (a)

How the amendment will change this existing administrative regulation: This

amendment states that electronic pulltab device and electronic pulltab sales

shall be included in gross receipts. It also allows organizations to donate

charitable gaming supplies and equipment to the department. Finally, it

corrects the improper use of "Office of Charitable Gaming" by

changing the language to "Department of Charitable Gaming." Similarly

the amendment corrects the improper labeling of the "Public Protection

Cabinet" as the "Environmental and Public Protection Cabinet."

      (b)

The necessity of the amendment to this administrative regulation: This

amendment is necessary to include electronic pulltabs in gross receipts. The

amendment was further necessary to note the correct cabinet and department

names.

      (c)

How the amendment conforms to the content of the authorizing statutes: The statutory

authorities for this regulation are KRS 238.515 (4), (9) and 238.550(3). KRS

238.515 (4), and (9) sets forth the powers of the department to establish and

enforce reasonable standards for the conduct of charitable gaming and the operation

of charitable gaming facilities; to establish standards of accounting,

recordkeeping, and reporting to insure charitable gaming receipts are properly

accounted for; and, to "promulgate administrative regulations which are

necessary to carry out the purposes and intent of [KRS Chapter 238]." This regulation

amendment incorporates conforms to the authorizing statute by stating what is

included in gross receipts. It also conforms by providing parameters for the

disposition of supplies and equipment when an organization no longer intends to

game. The amendment further corrects the regulation to reflect the current cabinet

and department names as stated in the statutes.

      (d)

How the amendment will assist in the effective administration of the statutes: The

amendment will clarify that electronic pulltab devices and pulltabs are

included in gross receipts and will give organizations another option to donate

their supplies when they no longer intend to game. It will also now reflect the

correct agency name.

      (3)

List the type and number of individuals, businesses, organizations, or state

and local governments affected by this administrative regulation: This

amendment will impact licensed charitable organizations. There are currently

603 licensed charitable organizations.

      (4)

Provide an analysis of how the entities identified in Question (3) above will

be impacted by either the implementation of this administrative regulation, if

new, or by the change, if it is an amendment, including:

      (a)

List the actions that each of the regulated entities identified in Question (3)

will have to take to comply with this administrative regulation or amendment:

The organizations will have additional options to get rid of supplies when they

quit gaming. They will also be required to report electronic pulltab sales in

their gross receipts.

      (b)

In complying with this administrative regulation or amendment, how much will it

cost each of the entities identified in Question (3): There should be no cost

to the organization.

      (5)

Provide an estimate of how much it will cost to implement this administrative

regulation:

      (a)

Initially: There will be no cost to implement this amendment to the

administrative regulation.

      (b)

On a continuing basis: There should be no additional cost on a continuing

basis.

      (6)

What is the source of the funding to be used in the implementation and

enforcement of this administrative regulation: There is no additional funding

necessary to implement this amendment to the administrative regulation. There

will be no additional funding necessary to enforce the provisions of the

amended regulation.

      (7)

Provide an assessment of whether an increase in fees or funding will be

necessary to implement this administrative regulation, if new, or by change, if

it is an amendment: There will be no increase in fees or funding necessary to

implement this amendment to the administrative regulation.

      (8)

State whether or not this administrative regulation establishes any fees or

directly or indirectly increases any fees: This amendment to the regulation

does not establish any new fees or directly or indirectly increase any fees.

      (9)

TIERING: Is tiering applied? No. Only licensed charitable organizations are

affected by this regulation and it applies equally to all.

 

FISCAL NOTE ON STATE AND LOCAL GOVERNMENT

 

      1.

What units, parts, or divisions of state or local government (including cities,

counties, fire departments, or school districts) will be impacted by this

administrative regulation? The Kentucky Department of Charitable Gaming as

implementer of this regulation.

      2.

Identify each state or federal statute or regulation that requires or

authorizes the action taken by the administrative regulation. KRS 238.515 and

KRS 238.550.

      3.

Estimate the effect of this administrative regulation on the expenditures and

revenues of a state or local government agency (including cities, counties,

fire departments, or school districts) for the first full year the

administrative regulation is to be in effect. There should be no effect on the

expenditures or revenues of any government agency.

      (a)

How much revenue will this administrative regulation generate for the state or

local government (including cities, counties, fire departments, or school

districts) for the first year? The amendment to the regulation should not

generate revenue in the first year or in subsequent years.

      (b)

How much revenue will this administrative regulation generate for the state or

local government (including cities, counties, fire departments, or school

districts) for subsequent years? See response to (a) above.

      (c)

How much will it cost to administer this program this program for the first

year? It is not anticipated that that there will be any cost in administering

the program that this regulation relates to.

      (d)

How much will it cost to administer this program in subsequent years? See

response to (c) above.

      Note: If specific dollar estimates

cannot be determined, provide a brief narrative to explain the fiscal impact of

this administrative regulation.

      Revenues

(+/-): Not applicable; see response to (c) above.

      Expenditures

(+/-): Not applicable; see response to (c) above.

      Other

explanation: There should be no fiscal impact.
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