§ 542.15 What are the minimum internal control standards for credit? 

(a) Computer applications. For any computer applications utilized, alternate 

documentation and/or procedures that provide at least the level of control described by 

the standards in this section, as approved in writing by the Tribal gaming regulatory 

authority, will be acceptable. 

Justification: Based on previous MICS audits, gaming operations do not always obtain 

specific approval of the computer applications being utilized. Adding the words “in 

writing” will require them to obtain documentation of approval. 

(b) Credit standards. The following standards shall apply if the gaming operation 

authorizes and extends credit to customers: 

(1) At least the following information shall be recorded for customers that have credit 

limits or are issued credit (including the issuance of markers but excluding personal 

checks, payroll checks, cashier's checks, counter checks and traveler's checks): 

Justification: Clarifies that the issuance of markers is an issuance of credit but counter 

checks is not. 

Comment (October): Verify that this paragraph does not conflict with Section 

542.2 definition of credit. 

Response: Paragraph is consistent with the Section 542.2 definition of credit. 

(i) Customer's name, current address, and signature; 

(ii) Identification verifications including type of identification credential, credential 

number, expiration date of credential, and date credential was examined. A 

driver’s license is the preferred method for verifying the customer’s identity. A 

passport, non-resident alien identification card, other government issued 

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identification credential or another picture identification credential normally 

acceptable as a means of identification when cashing checks, may also be used.

Justification: Clearly delineates information required to be recorded and preference for 

driver’s license as identification credential.

 

Comment (October): Include a specific reference to the Tribal ID of the gaming 

operation’s tribe as an accepted alternative identification credential. 

Response: Disagree. It is left to management to interpret "other government 

issued identification credential" to include the Tribal ID of the gaming operation's 

tribe, taking into consideration the characteristics of the credential, and the 

specific operating environment.

(iii) Authorized credit limit; 

(iv) Documentation of authorization Signature of approval by a person designated

authorized by management to approve credit limits (for computerized systems, a credit 

limit approval controlled through system passwords is adequate); 

Justification: Stipulates that the required documentation is a signature of a person 

authorized to approve credit limits or the use of a password protected system. 

(v) Date, time and amount of credit issuances and payments; and

Justification: Provides for detailed record-keeping of credit issued and repaid. 

(vi) Amount of available credit.

(2) Prior to the issuance of gaming extending credit, the customer's gaming operation 

credit record and/or other documentation shall be examined to determine the 

following the individual preparing to issue the credit shall:

(i) Determine whether the Properly authorized credit limit is properly authorized;

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(ii) Determine the amount of available credit and whether remaining credit is 

sufficient to cover the credit issuance; and 

(iii) Verify the identity of the customer by examining the customer’s identity 

credential or other reasonable method to ensure the customer’s identity (except for 

known customers).

Justification: Specifies the tasks that must be performed by the employee preparing to 

issue the credit prior to credit issuance. 

(3) Credit extensions over a specified dollar amounts shall be approved by personnel 

designated by management. 

Justification: Permits the establishment of differing levels of approval for differing 

dollar amounts. 

(4) Proper approval of credit extensions over ten percent (10%) of the previously 

established limit, including a temporary increase, shall be documented. 

Justification: Clarifies that a temporary increase, as well as a “permanent” increase 

must be approved 

(5) The job functions of credit approval (i.e., establishing the customer's credit 

worthiness) and credit extension (i.e., advancing customer's credit) shall be segregated 

for credit extensions to a single customer of $10,000 or more per day (applies whether the 

credit is extended in the pit or the cage). 

(6) If cage credit is extended to a single customer in an amount exceeding $2,500, 

appropriate gaming personnel shall be notified on a timely basis of the customers playing 

on cage credit, the applicable amount of credit issued, and the available balance. 

Comment (October): Paragraphs (5) and (6) appear to conflict. 

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Response: Disagree. Paragraph (5) addresses the credit approval and extension 

process, paragraph (6) addresses floor notification of credit extended by the cage. 

However, paragraph (6) will be revised to provide more differentiation. 

Note: On review, the standard is missing clarification regarding the notification 

process. Proposal has been modified accordingly. 

Revised proposal incorporating note: 

(6) If cage credit is extended to a single customer in an amount exceeding $2,500, the 

amount established by management (not to exceed $10,000, Tribal gaming 

regulatory authority approval recommended), appropriate gaming personnel shall be 

notified on a timely basis (e.g., via computer and provided the gaming department 

can access computer record of gaming activity) of the customers playing on cage 

credit, the applicable amount of credit issued, and the available balance. 

Comment (December): Replace TGRA approval recommendation with approval 

requirement. 

Comment (December): Notification requirement and TGRA approval of the 

threshold should be separate paragraphs to enhance clarity. 

Response: Agree. Revised accordingly. 

Revised proposal as a result of December comments: 

(6) If cage credit is extended to a single customer in an amount exceeding $2,500, the 

threshold established by management (threshold not to exceed $10,000), appropriate 

gaming personnel shall be notified on a timely basis (e.g., via computer and provided 

the gaming department can access computer record of gaming activity) of the 

customers playing on cage credit, the applicable amount of credit issued, and the 

available balance. 

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(i) The threshold amount that the cage is authorized to extend credit without 

required notification to appropriate gaming personnel shall be approved by the 

Tribal gaming regulatory authority.

(ii) [Reserved]

(7) Cage marker forms shall be at least two parts (the original marker and a payment 

slip), prenumbered by the printer or concurrently numbered by the computerized system, 

and utilized in numerical sequence. 

(8) The completed original cage marker shall contain at least the following information: 

(i) Marker number; 

(ii) Player's name and signature; 

(iii) Amount of credit issued (both alpha and numeric); and 

(iv) Signature of the cashier.

Justification: Adds the requirement for the cashier’s signature.

(9) The completed payment slip shall include the same marker number as the original, 

date and time of payment, amount of payment, nature of settlement (cash, chips, etc.), 

and signature of cashier receiving the payment. 

(c) Payment standards. (1) All payments received on outstanding credit instruments shall 

be recorded in ink or other permanent form of recordation in the gaming operation's 

records. 

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(2) When partial payments are made on credit instruments, they shall be evidenced by a 

multi-part sequentially-numbered receipt (or another equivalent document) that 

contains: 

Justification: Clarifies requirement that receipts must be sequentially numbered.

(i) The same preprinted receipt number on all copies; 

Justification: Clarifies that it is the same receipt number that is required. 

(ii) Customer's name; 

(iii) Date of payment; 

(iv) Dollar amount of payment (or remaining balance if a new marker is issued), and 

nature of settlement (cash, chips, etc.); 

(v) Signature of individual receiving payment; and 

(vi) Marker N number or other identifying characteristic of credit instrument on 

which partial payment is being made. 

Justification: Permits the use of identifying characteristic other than marker number.

Comment (October): Strike “or other identifying characteristic”, or provide 

examples. Phrase is not defined. 

Response: Agree. Modified accordingly 

Revised proposal as a result of October comment: 

(vi) Marker N number of credit instrument on which partial payment is being made. 

(3) Unless credit account balances are routinely confirmed on a random basis by the 

accounting or internal audit departments, or statements are mailed by a person 

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independent of the credit transactions and collections thereon, and the department 

receiving payments cannot access cash, then the following standards shall apply: 

Justification: Clarifies that sub-section refers to credit accounts. 

(i) The routing procedures for credit instrument payments by mail require that they be 

received by a department independent of credit instrument custody and collection; 

(ii) Such receipts Credit instrument payments received by mail shall be documented 

on a listing indicating the customer's name (and the name of the individual making the 

payment if different than the customer), amount of payment, nature of payment (if 

other than a check), and date payment received; and 

Justification: Clearly specifies the receipts to which the requirement applies and 

prescribes procedure to be followed if someone other than the customer makes the 

payment. 

(iii) The total amount of the listing of mail receipts shall be reconciled with the total mail 

receipts recorded on the appropriate accountability form by the accounting department on 

a random basis (for at least three (3) days per month). 

(d) Access to credit documentation. (1) Access to credit documentation shall be restricted 

as follows: 

(i) The credit information shall be restricted to those positions that require access and are 

so authorized by management; 

(ii) Outstanding credit instruments shall be restricted to persons authorized by 

management; and 

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(iii) Written-off credit instruments shall be further restricted to persons specified 

authorized by management. 

Justification: Substitution of “authorized” for “specified” creates consistency within 

the sub-section. 

(2) [Reserved] 

(e) Maintenance of credit documentation. (1) All extensions of cage credit, pit credit 

transferred to the cage, and subsequent payments received shall be documented by cage 

personnel on a credit instrument control form.

Justification: Specifies that it is the cage personnel who must prepare this 

documentation. 

(2) Records of all correspondence, transfers to and from outside agencies, and other 

documents related to issued credit instruments shall be maintained. 

(f) Write-off and settlement standards. (1) Written-off or settled credit instruments shall 

be authorized in writing. 

(2) Such authorizations shall be made by at least two management officials who are 

from departments independent of the credit transaction at least one of whom is 

independent of the initial credit limit approval process and the issuance and 

collection of credit relative to the customer’s account. The individuals approving 

the write-off or settlement must sign a document indicating their authorization.

Justification: Clarifies the independence requirement and stipulates that the document 

authorizing the write-off must contain signatures of both individuals. 

(3) Completed written-off and settled credit instrument documentation is submitted 

to the accounting department within 72 hours of completion.

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Justification: Requirement added to ensure timely delivery of information to accounting 

department. 

(g) Collection agency standards. (1) If credit instruments are transferred to collection 

agencies or other collection representatives, a copy of the credit instrument and a receipt 

from the collection representative shall be obtained and maintained until the original 

credit instrument is returned or payment is received. 

(2) A person independent of credit transactions and collections shall periodically review 

the documents in paragraph (g)(1) of this section to ensure all required documents are 

present.

Justification: Clarifies the objective of reviewing documents.

542.15 (h) Accounting/auditing standards have been moved to proposed Revenue Audit 

542.50 (g). 

(h) Accounting/auditing. (1) A person independent of the cage, credit, and collection 

functions shall perform all of the following at least three (3) times per year:

(i) Select a sample of credit accounts;

Justification: Clarifies that not all credit accounts need to be reviewed.

(ii) (i) Ascertain compliance with credit limits and other established credit issuance 

procedures;

(iii) (ii) Randomly Reconcile outstanding balances of both active and inactive 

(includes write-offs and settlements) accounts on the accounts receivable listing to 

individual credit records and physical instruments. This procedure need only be 

performed once per year for inactive accounts; and

Justification: Clarifies that both write-offs and settlements are considered inactive 

accounts. 

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(iv) (iii) Examine credit records to determine that appropriate collection efforts are 

being made and payments are being properly recorded; and

(iv) (2) For a minimum of five (5) days per month, a person independent of the cage, 

credit, and collection functions shall subsequently reconcile partial payment receipts 

shall be subsequently reconciled to the total payments recorded by the cage for the 

day and shall be numerically accounted for account for the receipts sequentially.

Comment (October): Functions other than cage, credit, and collection may 

not be sufficiently independent to perform the reconciliation.

Response: Disagree. The functions listed here are the functions usually 

responsible for accepting and accounting for partial payments on credit 

instruments. Other functions will normally have the degree of independence 

necessary to perform the reconciliation.

Comment (October): Replace all occurrences of “person independent of cage, 

credit, and collection functions” in sub-section (h) with “revenue audit”.

Response: Disagree. “Revenue audit” is not a universal term in the 

industry, and is not defined in Part 542. For gaming operations where 

revenue audit is a distinct and defined function, and revenue audit is 

independent of the partial payment transactions, it is left to the TGRA to 

assign procedures in sub-section (h) to revenue audit.

Note: 542.50 (g) (3)-(5) were previously located in 542.14 Cage. However, 

because they are applicable to credit, they have been moved to this section.

(3) A trial balance of gaming operation accounts receivable, including the name of 

the customer and current balance, shall be prepared at least monthly for active, 

inactive, settled or written-off accounts. 

(4) The trial balance of gaming operation accounts receivable shall be reconciled to 

the general ledger each month. The reconciliation and any follow-up performed 

shall be documented, maintained for inspection, and provided to the Tribal gaming 

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regulatory authority upon request. 

(5) On a monthly basis an evaluation of the collection percentage of credit issued to 

identify unusual trends shall be performed.

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