Code of Massachusetts Regulations › 205 CMR - MASSACHUSETTS GAMING COMMISSION › Title 205 CMR 139.00 - Continuing disclosure and reporting obligations of gaming licensees › Section 139.07 - Annual Audit and Other Reports

Current through Register 1525, July 5, 2024
(1) On an annual
			 basis a gaming licensee shall, at its own expense, cause an audit to be
			 prepared by an independent certified public accountant of its financial
			 statements relevant to the operation of its Massachusetts gaming establishment.
			 The gaming licensee may satisfy this requirement by submission of the audit of
			 the consolidated financial statement, including applicable notes, of the gaming
			 licensee's holding company or intermediary company provided that such audit is
			 accompanied by a supplemental information, appendix, or other financial
			 information section specific to the gaming licensee which includes an audited
			 financial statement containing, at a minimum, a balance sheet, income
			 statement, and a statement of cash flows for the gaming licensee. In either
			 event, the independent certified public accountant shall attest to the
			 financial condition of the gaming licensee, disclose whether the accounts,
			 records and control procedures examined are maintained by the gaming licensee
			 as required by M.G.L. c. 23K and 205 CMR, and opine as to whether there are
			 material weaknesses in the gaming licensee's system of internal controls.
In the event that the independent certified public accountant
				makes recommendations to improve the system of internal controls, or to
				increase the gaming licensee's level of compliance, the gaming licensee's Chief
				Financial Officer shall respond, in writing, to the recommendations of the
				independent certified public accountant and provide the commission with a copy
				of its response.
(2) To
			 ensure the independence of the annual audit, at least every five years a gaming
			 licensee, whose holding company or intermediary company is not publicly traded,
			 shall rotate the lead (or coordinating) audit partner having primary
			 responsibility for the audit, and the audit partner responsible for reviewing
			 the audit. For a gaming licensee, whose holding company or intermediary company
			 is publicly traded, lead (or coordinating) audit partner rotation shall comply
			 with the requirements of federal law, including the requirements of the United
			 States Securities and Exchange Commission and/or the Public Company Accounting
			 Oversight Board.
(3) In the event
			 the annual audited financial statements differ from financial statements
			 maintained by the gaming licensee throughout the year, the gaming licensee
			 shall provide a summary of these differences as part of the annual
			 audit.
(4) The annual audit and
			 associated statements required in accordance with 205 CMR 139.07(1) shall be
			 filed with the commission within three months following the end of the quarter
			 following the end of the gaming licensee's fiscal year.
(5) In cases where a gaming licensee's parent
			 or holding company is not publicly traded, in the event the gaming licensee's
			 independent certified public accountant shall resign or be removed as the
			 gaming licensee's principal accountant or auditor, the gaming licensee shall
			 submit a written report to the commission within 20 days of such resignation or
			 removal, signed by its Chief Financial Officer and Chair of its Audit
			 Committee, outlining the cause or nature of the resignation or removal, stating
			 whether the resignation or removal was related to material differences between
			 the parties as to financial statement presentation issues, disclosures, or the
			 adequacy of the gaming licensee's system of internal accounting control and, if
			 so, a complete and detailed description of the differences for consideration by
			 the commission. The gaming licensee shall submit as an exhibit to this report a
			 letter from the former independent certified public accountant stating whether
			 he or she agrees with the statements made by the gaming licensee in the report
			 submitted to the commission.
In cases where a gaming licensee's parent or holding company is
				publicly traded, the gaming licensee shall file with the commission copies of
				such information and documents as are required to be filed with the United
				States Securities and Exchange Commission and/or the Public Company Accounting
				Oversight Board upon the resignation or removal of the publicly traded holding
				company's independent certified public accountant.
(6) To the extent possible, any adjustments
			 resulting from the annual audit required in accordance with 205 CMR 139.07
			 shall be recorded in the accounting records of the year to which the adjustment
			 relates. In the event the adjustments were not reflected in the gaming
			 licensee's quarterly report for the fourth quarter and the commission concludes
			 the adjustments are significant, a revised quarterly report for the fourth
			 quarter may be required from the gaming licensee. The revised filing shall be
			 due within 30 calendar days after notification to the gaming licensee, unless
			 an extension is granted by the commission.