Casino Accounting and Financial Management: Second Edition

Chapter 9: Bingo, Poker, Race and Sports Book

Bingo, poker, race and sports book operations are minor contributors to the overall revenue stream of a casino. As described in table 9-1, these games collectively contribute about 3.5% of the total revenue statewide in Nevada. Still, despite their minor revenue contribution, they are often a vital part of the casino product line and are very popular with many patrons. In fact, the gaming customer who plays these games is often quite different that the traditional slot machine or table games customer. In addition, the popularity of poker as a casino game has been enhanced as a result of the spread of online poker games, as well as increased television coverage of both regular and tournament poker. In spite of the greatly increased activity of these games, their contribution to casino profitability remains relatively minor. bingo Virtually all states permit bingo games for charity purposes or as a part of the tribal gaming operations allowed under the IGRA of 1988. The Cabazon tribe’s high-stakes bingo originally led to the legal challenge by the state of California and the U.S. Supreme Court to tribal gaming, with the court decision in favor of the tribe and ultimately the IGRA.1 Bingo was originally played as a low-stakes game in church hall basements and other fraternal organizations as a fundraising activity. Later developments allowed bingo as a community-based activity, usually for larger prizes. With the increase of more widespread commercial bingo operations, there have been enhanced electronic developments which allowed more games to be played at a more rapid pace. This, in turn, increased the profitability to the operator as well as improved the game’s popularity. c h a p t e r 9 Bingo, Poker, Race and Sports Book Bingo, Poker, Race and Sports Book 257 Tribal bingo, defined as a Class II game, has become commercially important . Table 9-2 and figure 9-1 illustrate the growth in both commercial bingo and tribal Class II bingo across the nation since 1992. Bingo is important in the tribal environment, since it is not subject to state control, and can be offered virtually with a variety of options. This lack of control has also led to numerous electronic enhancements to traditional paper bingo, and to bingobased electronic gaming devices that appear similar to slot machines. More modest electronic enhancements include electronic player stations and handsets that enable players to manage hundreds of cards per game. Electronic signage is another important improvement in the game. Finally, electronic bingo can offer linked games covering wide areas with much larger prizes. The larger prizes and progressive jackpots enhance the popularity of the game. Bingo Accounting and Controls The basic accounting and internal control procedures relating to bingo operations can be categorized according to the main phases of the bingo game: table 9-1 Other Game Revenue Sources in Nevada Nevada Las Vegas Las Vegas RenoStatewide Strip Downtown Sparks Bingo 0.04% 0.03% 0.43% 0.18% Poker 0.80% 0.86% 0.89% 0.75% Other 0.62% 0.94% 0.98% 0.47% Race Book 0.89% 0.91% 0.55% 0.65% Sports Book 1.14% 1.03% 0.76% 1.43% Total 3.49% 3.77% 3.61% 3.48% table 9-2 Commercial Bingo and Tribal Class II Revenues 1992–2001 ($ in Millions) Commercial Tribal Year Bingo Revenue Class II Bingo 1992 1050 400 1993 1048 550 1994 1000 570 1995 980 680 1996 970 980 1997 972 1000 1998 1100 1080 1999 1050 1140 2000 1020 1200 2001 1100 1400 258 Accounting· Controls over “selling” cards to customers· Controls over drawing the balls during the bingo game· Controls over the payoff of winnings Bingo is a game that has wide popularity outside of casinos.2 However, as a casino game, it represents a very small amount of revenue and is offered merely to assure a full range of entertainment products to the casino customers. On a structural and procedural basis, bingo games resemble keno in certain areas, particularly where the procedures for the draw of the game and the jackpot payoff processes are concerned. However, a major difference exists with respect to the revenue earning process. Card Control: The first area of concern is the control over the issuance of bingo cards in the game, as well as the collection of revenue from customers. The control of...