(b)

1. (1)

   1. (A) General accounting records shall be maintained on a double-entry system of accounting with transactions recorded on the accrual basis.
   2. (B) Detailed, supporting, subsidiary records sufficient to meet the requirements of subsection (c) of this section shall also be maintained in accordance with the requirements of this section.
2. (2) The licensee will submit to the Arkansas Racing Commission for its approval a chart of accounts and accounting classification in order to ensure consistency, comparability, and effective disclosure of financial information.
3. (3) The chart of accounts shall provide the classifications necessary to prepare the standard financial statements required by 23 CAR § 358-609.
4. (4) The prescribed chart of accounts shall be the minimum level of detail to be maintained for each accounting classification by the licensee.

5. (5)

   1. (A) The licensee shall use the prescribed chart of accounts but may, with the permission of the Arkansas Racing Commission, expand the level of detail for some or all accounting classifications and/or alter the account numbering system.
   2. (B) In such instances, the licensee shall provide to the Arkansas Racing Commission, upon request, a cross-reference from the prescribed chart of accounts.

(c) The detailed, supporting, and subsidiary records shall include, but not necessarily be limited to:

1. (1) Records supporting the accumulation of the costs and number of persons, by category of service, for regulated complimentary services;
2. (2) Records of all investments, advances, loans, and receivable balances due to the establishment;
3. (3) Records related to investments in property and equipment;
4. (4) Records which identify the gross wagering revenue, payout, win amounts, and percentages will be reported daily, and theoretical win amounts and percentages and differences between theoretical and actual win amounts and percentages for each casino gaming periodically, monthly, or as requested by the Arkansas Racing Commission;
5. (5) Records of all loans and other amounts payable by the establishment; and
6. (6) Records provided for in the system of internal accounting controls submitted to the Arkansas Racing Commission.

(f)

1. (1) The financial statements required by this section shall include a footnote reconciling and explaining any differences between the financial statements included in the licensee’s annual report, filed in conformity with this part, and the audited financial statements.

2. (2) Such footnote shall, at a minimum, disclose the effect of such adjustments on:

   1. (A) Revenues from casino gaming;
   2. (B) Revenues net of complimentary services;
   3. (C) Total costs and expenses;
   4. (D) Income before extraordinary items; and
   5. (E) Net income.

(h) Each licensee shall require its independent certified public accountant to render the following additional reports:

1. (1)

   1. (A) Report on material weaknesses in internal accounting control.
   2. (B) Whenever in the opinion of the independent certified public accountant there exist no material weaknesses in internal accounting control, the report shall so state;
2. (2) Whenever in the opinion of the independent certified public accountant the licensee has materially deviated from the system of internal accounting control approved by the Arkansas Racing Commission or the accounts, records, and control procedures examined are not maintained by the licensee in accordance with this part, the report shall enumerate such deviations and such areas of the system no longer considered effective, and shall make recommendations regarding improvements in the system of internal accounting control; and

3. (3)

   1. (A) The licensee shall prepare a written response to the independent certified public accountant’s reports required by subdivisions (h)(1) and (2) of this section.
   2. (B) The response shall indicate, in detail, the corrective actions taken.
   3. (C) Such response shall be submitted to the Arkansas Racing Commission within ninety (90) days from receipt of the independent certified public accountant’s reports.

(k) If an independent certified public accountant who was previously engaged as the principal accountant to audit the licensee’s financial statements resigns or is dismissed as the licensee’s principal accountant, or another independent certified public accountant is engaged as principal accountant, the licensee shall file a report with the Arkansas Racing Commission within ten (10) days following the end of the month in which such event occurs, setting forth the following:

1. (1) The date of such:

   1. (A) Resignation;
   2. (B) Dismissal; or
   3. (C) Engagement;

2. (2)

   1. (A) Whether in connection with the audits of the two (2) most recent years preceding such resignation, dismissal, or engagement there were any disagreements with the former accountant on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements if not resolved to the satisfaction of the former accountant would have caused him or her to make reference in connection with his report to the subject matter of the disagreement, including a description of each such disagreement.
   2. (B) The disagreements to be reported include those resolved and those not resolved;

3. (3)

   1. (A) Whether the principal accountant’s report on the financial statements for any of the past two (2) years contained an adverse opinion or a disclaimer of opinion or was qualified.
   2. (B) The nature of such adverse opinion, disclaimer of opinion, or qualification shall be described; and

4. (4)

   1. (A) The licensee shall request the former accountant to furnish to the licensee a letter addressed to the Arkansas Racing Commission stating whether he or she agrees with the statements made by the licensee in response to subsection (i) of this section.
   2. (B) Such letter shall be filed with the Arkansas Racing Commission as an exhibit to the report required by subsection (i) of this section.