Financial reporting

(a) New games, division approval. After acquiring the CLCB's approval, the CLC shall obtain the division's review and approval of all new game designs, and official game procedures and working papers, in order to insure the integrity of the games. The division's review or approval shall be conducted within seven (7) business days of receipt. If the division fails to approve or disapprove within such seven (7) day period, it shall be deemed to have approved such game designs and procedures. Such approval shall not be unreasonably withheld. (b) Provision of all CLC records. The CLC shall provide to the division all business records, reports, documents, policies and procedures required by the division in its sole discretion. (c) Provision of CLC payroll listings and organizational charts. The CLC shall provide to the division a complete payroll listing of all CLC employees on a monthly basis. The CLC shall provide to the division on an annual basis a complete organizational chart, including officers and directors, and advise the division promptly concerning changes in key personnel. (d) Annuity providers, division approval. (1) All annuities, from which payments shall be made to winners of lottery prizes, shall be invested in instruments issued by agencies of the United States government and backed by the full faith and credit of the United States, or shall be issued by insurance companies licensed to do business in the state. (2) The division shall approve, prior to utilization by the CLC, the financial stability and acceptable minimum investment rating of all annuity providers. (e) Cost of regulatory oversight paid for by CLC. The CLC shall reimburse the division for all reasonable direct and indirect costs associated with the regulatory oversight of the corporation, as determined by the division in its sole discretion. (f) Offices for Division. The CLC shall provide suitable office space for the use of division personnel at the CLC corporate offices and the primary site. Final determination as to the suitability of said office space is in the sole discretion of the division. Division personnel shall have unfettered access to all areas of the CLC offices and the primary site. (g) Records retention. The CLC and any vendor shall retain all business records for a period of not less than five (5) years. (h) Return of agent licenses. The CLC shall obtain the lottery sales agent license certificate of surrendered, canceled, suspended, or revoked agents. If the CLC is unable to obtain the license, it shall provide the division with an affidavit explaining the reason therefor. (i) Changes in agent status. The CLC shall, on a monthly basis, notify the division of changes in the status of issued lottery sales agent licenses and the reason(s) for such, and any withdrawal of pending license applications. (j) Delinquency assessment accounting. The CLC shall account to the division on a monthly basis, those amounts that remain outstanding for all delinquent agents. Said reporting shall delineate delinquencies by individual agent. (k) Acceptance testing. (1) Prior to the installation of any on-line wagering system or the implementation of any software or hardware modifications, the CLC shall certify to the division that the system has been tested and is operating correctly. The CLC shall make available the acceptance test plans, test script and test results for review by the division prior to implementation. (2) In the sole discretion of the division, the CLC shall require a vendor to produce a test system accessible and available for division testing prior to implementation of the on-line wagering system or any software or hardware modifications. (3) The division shall have final approval over the implementation of any system modification. (l) Unclaimed prize funds, accounting. (1) The CLC shall maintain a separate accounting of unclaimed prize funds. Information on unclaimed prize contributions for on-line gaming shall be made available through the CLC's on-line wagering system's management information system and for off-line gaming from other sources, as approved by the division. Such information shall include, but not are limited to, accurate reports of purged tickets. (2) Information on unclaimed prize dispersals shall be submitted quarterly to the division by the CLC and shall be distinguished by allowable categories as specified in section 12-806(b)(10) of the Connecticut General Statutes. (3) The CLC shall make available all information required under this section and shall submit an annual report of all unclaimed prize funds available for disposition after the expiration date of the unclaimed prize. All information shall be in a format approved by the CLC. (m) Tax withholding and reporting. (1) The CLC shall be responsible for all applicable federal and state withholding and reporting responsibilities arising under the provisions of chapters 226, 226b and 229a of the Connecticut General Statutes pertaining to lottery prize winners, lottery agents and any other applicable person or entity. The division shall be held harmless from any federal or state tax penalties or interest that may arise as a result of the CLC's activities in performing these responsibilities. (2) The division shall have the right to inspect withholding and miscellaneous income records and related tax filings as prepared by the CLC at all times. (n) Federal gaming occupation tax. If, at any time, the operation or the management of the CLC becomes subject to the federal gaming occupation tax, the CLC shall be responsible for meeting all applicable requirements and shall hold lottery agents, any other applicable person or entity and the division, harmless from any penalties or interest that may arise as a result of the CLC's activities in performing these responsibilities. (o) Contact personnel. (1) The CLC shall designate individual(s) knowledgeable in, and responsible for, the CLC's accounting and reporting systems as contact person(s) who shall respond to and cooperate with the division regarding accounting and other financially related questions or problems. (2) The CLC shall provide the division with the names(s) of contact persons from each financial consultant and CPA firm utilized for financial advice, accounting and auditing functions, as applicable, and shall provide the name(s) of contact person(s) from any law firm utilized for legal counsel and advice. Such information as submitted to the division shall be updated for any changes as they occur. (3) The CLC shall provide the division with the name(s) of vendor contact personnel in the event of system problems. (p) Disclosure of odds of winning. (1) The CLC shall include a prominent and clear statement of the average chances of winning per lottery ticket in each advertisement intended to promote the purchase of lottery tickets. (2) The provisions of subdivision (1) of this subsection shall apply only to (A) advertisements in newspapers, magazines, brochures and on posters and (B) television and radio advertisements thirty seconds or longer for one game. (3) The CLC shall include a prominent and clear statement of the odds of winning each individual prize level on all game brochures. (q) Automated wagering system balancing and reconciliation. The CLC shall have procedures to internally balance and reconcile the on-line wagering system on a daily, weekly, and monthly basis and shall provide reports of same to the division.