Audit Division Personnel
The Audit Division currently has a professional staff of 84 employees (63 located in Las Vegas and 21 in Reno), and a clerical staff of 6. All professionals have degrees and, as Agents of the Board, are peace officers of the State of Nevada and are required to carry a badge and identification. The Audit Division is organized much like a large CPA firm, but with different job titles (i.e., Chief, Deputy Chief, Supervisor, Special Agent, Senior Agent, and Agent).
The Audit Division’s experience qualifies for CPA certification experience in Nevada. The requisite college degree and four years experience with the Audit Division are required to become certified. Presently, over 50% of the Audit Division’s professional staff are either CPAs, or have passed the CPA exam and are in the process of satisfying their experience requirement.
Audit Division Responsibilities
The Audit Division is charged with performing the following specific responsibilities:
1. Audits -The Audit Division is primarily responsible for auditing Group I casinos throughout the state (i.e., those casinos with annual gaming revenue that exceeds the annual threshold amount). Presently, there are approximately 149 such casinos, and the audit cycle is about 2.87 years.
The primary objectives of a Board audit are to determine the proper reporting of gaming revenue, and to determine if the casino has complied with all applicable gaming laws and regulations. In meeting these objectives, the division uses procedures common to the auditing profession. Internal accounting controls are thoroughly analyzed, in-depth analytical review of operating statistics is undertaken, and detail tests of transactions are performed. The objective of these procedures is to gather sufficient audit evidence to render an audit opinion. At the conclusion of an audit the division issues a written report to the Nevada Gaming Control Board, which includes this audit opinion. The Audit Division is required by regulation to perform audits in accordance with generally accepted auditing standards.
The division employs various means in gathering audit evidence. Surprise observations of casino procedures are routinely conducted on an interim basis throughout the audit period. Interviews with casino personnel are periodically performed to ensure that the casino is complying with documented internal accounting controls. For those casinos with branch offices outside of Nevada (including those outside of the country), inspections of these offices are performed by Audit Division Agents to ensure that proper operating procedures are being followed.
2. Compliance Reviews - A number of other businesses in Nevada are required to be licensed in
addition to casinos. Operators of slot machine routes, slot machine
manufacturers and distributors, disseminators of racing information, operators
of inter-casino linked gaming systems, and pari-mutuel systems operators are
required to comply with a number of statutes and regulations. The Audit
Division will periodically review these operations for regulatory and statutory
3. Special Investigations - On occasion, the Audit Division is assigned special investigations work. These investigations often entail developing evidence to prove skimming (the diversion of funds to avoid the payment of taxes) or money laundering in a casino. This work may be performed in conjunction with other state or federal agencies such as the FBI, IRS, etc.
4. Other Responsibilities - The Audit Division has a number of additional responsibilities, including but not limited to:
a) Audit Division Agents periodically observe cash counts to ensure that the casinos have sufficient funds, pursuant to Regulation 6.150, to operate.
b) Casinos with revenues in excess of the annual threshold amount are required to submit annual audited financial statements. The Audit Division analyzes these statements to monitor the entities continuing financial viability.
c) Certain transactions (e.g., loans and leases) made to casinos must be approved by the Board and Nevada Gaming Commission. The Audit Division reports to the Board all such transactions that have been submitted, along with the source of the funds. This is necessary to ensure that the casinos only receive funds from reputable sources.
d) The Audit Division routinely monitors, through numerous statistical reports, the performance of all casino games in the state. If substandard performance is observed, various types of follow-up work are performed to determine the reasons for this poor performance.