Arkansas Lottery Commission an Enterprise Fund of the State of Arkansas
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Arkansas Lottery Commission An Enterprise Fund Of The State Of Arkansas Allison Rubio | Cabot Byron Wesson | Little Rock Jasper Stewart | Little Rock Karey Russell | Pine Bluff Amanda Shults | El Dorado Brice Smith | Fordyce Comprehensive Annual Financial Report For The Fiscal Year Ended Corey Parks | Fort Smith JUNE 30, 2013 I’m thankful that I have received the Arkansas Academic Chal- lenge Scholarship. It allows me the opportunity to attain a quality education without being burdened with financial hardships. This scholarship allows me to remain home in Arkansas while receiving my education, which prepares me for the future. I appreciate those who contribute to this scholarship. For this, I am grateful. Torey Peterson | Freshman | Southeast Arkansas College White Hall Arkansas Lottery Commission An Enterprise Fund of the State of Arkansas Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2013 Mike Beebe Governor, State of Arkansas Bishop Woosley Director Prepared by Finance Division The [Arkansas] Academic Challenge Scholarship is allowing me to pursue my passion of teaching young children and helping them ¿QGWKHLUZD\LQWKHZRUOG Teyah Green | Sophomore | University of the Ozarks Jacksonville Arkansas Lottery Commission An Enterprise Fund of the State of Arkansas Comprehensive Annual Financial Report For the Fiscal Year Ended June 30, 2013 Table of Contents INTRODUCTORY SECTION Letter from Commission Chairman I Letter of Transmittal III Mission, Vision, Values XI Listing of Commissioners XII Organizational Chart XIV Department Overview XV &HUWL¿FDWHRI$FKLHYHPHQWIRU([FHOOHQFHLQ)LQDQFLDO5HSRUWLQJ XVI FINANCIAL SECTION ,QGHSHQGHQW$XGLWRU¶V5HSRUW 1 Management’s Discussion and Analysis 3 Basic Financial Statements Statement of Net Position 11 6WDWHPHQWRI5HYHQXH([SHQVHVDQG&KDQJHVLQ1HW3RVLWLRQ 12 6WDWHPHQWRI&DVK)ORZV 13 Notes to Financial Statements 15 STATISTICAL SECTION 6WDWLVWLFDO6HFWLRQ7DEOHRI&RQWHQWV 29 )LQDQFLDO7UHQGV 3ULQFLSDO5HYHQXH6RXUFHV 30 5HYHQXHV([SHQVHVDQG&KDQJHLQ1HW3RVLWLRQ 31 1HW3RVLWLRQE\&RPSRQHQW 32 &KDQJHVLQ&DVKDQG&DVK(TXLYDOHQWV 33 'HPRJUDSKLFVDQG2SHUDWLRQ,QIRUPDWLRQ 7RWDO3HUVRQDODQG3HU&DSLWD,QFRPHDQG8QHPSOR\PHQW5DWH 34 6WDWHRI$UNDQVDV3ULQFLSDO(PSOR\HUV 35 (PSOR\HHVE\'HSDUWPHQWDQG)XQFWLRQ 36 &DSLWDO$VVHWVE\'HSDUWPHQW 37 Other Information 86/RWWHULHV¶6DOHV 38 'HPRJUDSKLF6XPPDU\ 40 Supplementary Information 8QFODLPHG/RWWHU\3UL]H0RQH\ 41 6FKRODUVKLS6KRUWIDOO5HVHUYH7UXVW$FFRXQW 42 0LQRULW\RZQHGDQG)HPDOHRZQHG%XVLQHVV3DUWLFLSDWLRQ 43 The [Arkansas Academic] Challenge Scholarship is much more than just money for my education – it is the open door of oppor- tunity for me to better myself. If it were not for this scholarship, I would have never been able to even consider obtaining a doctor- ate degree, let alone plan to pursue it like I am doing now. This funding allows me to not only achieve the goals that I have set for myself – it allows me to go beyond them. Kaitlyn Riggin | Sophomore | Arkansas State University-Newport Weiner Table of Contents, continued 5HWDLO6DOHVE\&RXQW\ 44 'HPRJUDSKLF5HSRUWIURPWKH$UNDQVDV'HSDUWPHQWRI+LJKHU(GXFDWLRQ 46 3URMHFWHG2EOLJDWLRQVIURP6FKRODUVKLSDQG*UDQW)XQGLQJ6RXUFHVIURP$UNDQVDV'HSDUWPHQW RI+LJKHU(GXFDWLRQ 47 $FDGHPLF&KDOOHQJH6FKRODUVKLS3URJUDP 48 'HEW6HWRII&ROOHFWLRQV 50 )XQG%DODQFHVDQG2WKHU,QIRUPDWLRQIURP$UNDQVDV'HSDUWPHQWRI+LJKHU(GXFDWLRQ 51 7HUP&RQWUDFWVIRU*RRGVDQG6HUYLFH 52 Other Reports 5HSRUWRQ,QWHUQDO&RQWURORYHU)LQDQFLDO5HSRUWLQJDQGRQ&RPSOLDQFHDQG2WKHU0DWWHUV %DVHGRQDQ$XGLWRI)LQDQFLDO6WDWHPHQWV3HUIRUPHGLQ$FFRUGDQFHZLWK Government Auditing Standards 53 The Arkansas Academic Challenge [Scholarship] has helped me because I no longer have loans adding up and it is providing me with a brighter future. Tamara Esaw | Sophomore | University of Arkansas at Monticello Dumas INTRODUCTORY section The Arkansas Academic Challenge Scholarship has allowed students to attend Arkansas State University who otherwise may not have had the resources. Additionally, the Academic Challenge Scholarship has enabled students to graduate with reduced student loan debt.” Dr. Tim Hudson | Chancellor Arkansas State University Novermber 12, 2013 Fellow Arkansans: Since 2009, the Arkansas Lottery Commission has remained steadfast in our commitment to maximizing funds for the stu- dents of Arkansas. Over the past four years, we have gener- ated $344,796,599 in net proceeds, resulting in 98,279 schol- arships awarded by the Department of Higher Education to deserving college students. As a commissioner and an educator, I understand the importance of providing opportunities for our students to pursue their dreams through higher education – which, in turn, will help to VHFXUHDEHWWHUIXWXUHIRU$UNDQVDV7KHPLOOLRQJHQHUDWHGLQ¿VFDO\HDUWRSURYLGH 32,881 scholarships demonstrates our continuing commitment to the students and families of this state. Our success would not be possible without the dedication of our employees and retail partners and the support of so many who participate in purchasing lottery tickets. This year, 92 cents of every lottery dollar was returned to the state in the form of scholarships, prizes and retailer com- PLVVLRQV:LWKPRUHWKDQPLOOLRQLQSUL]HVDZDUGHG±LQFOXGLQJ¿YHSUL]HVRIPLOOLRQDQG three prizes of $2 million – it has been a truly exciting year for lottery participants. Our network of more than 1,890 retailers across the state, who are vital to our organization, received almost $25 million in retailer commissions. ,LQYLWH\RXWRUHYLHZWKHGHWDLOVRIRXU¿VFDO\HDULQFOXGLQJWKHDXGLWHG¿QDQFLDOVWDWH- PHQWV:HORRNIRUZDUGWRSURXGO\FRQWLQXLQJZLWKRXUPLVVLRQLQ¿VFDO\HDUDQGKRSH each of you will continue to contribute to these efforts and accept the challenge to support and UHZDUGRXUGHVHUYLQJFROOHJHVWXGHQWV7KLV\HDUZLOOEHDQH[FLWLQJRQHDVZHFHOHEUDWHWKH¿UVW group of traditional Arkansas Academic Challenge Scholarship recipients who are expected to complete their baccalaureate degrees in the spring. Please accept our sincere appreciation, George Hammons Chairman, Arkansas Lottery Commission I The Arkansas Academic Challenge [Scholarship] has helped me FRYHUWKHFRVWRIVFKRROWKDW¿QDQFLDODLGDQGP\IDPLO\FRXOGQRW cover. It helps keep me focused as a reminder of what I’m here for. The Arkansas Academic Challenge [Scholarship] means a lot to my family and I, and I am very thankful for this opportunity the state has given me. Braeden Miller | Freshman | University of Central Arkansas Maumelle II State of Arkansas 3RVW2I¿FH%R[ Arkansas Lottery Commission /LWWOH5RFN$UNDQVDV 3KRQH )D[ KWWSP\DUNDQVDVORWWHU\FRP November 12, 2013 The Honorable Mike Beebe, Governor Members of the Arkansas Lottery Commission Legislative Oversight Committee Dr. George Hammons, Chair, Arkansas Lottery Commission Members of the Arkansas Lottery Commission Citizens of the State of Arkansas We are pleased to submit to you this Comprehen BACKGROUND VLYH$QQXDO)LQDQFLDO5HSRUW &$)5 RIWKH$UNDQ $FRQVWLWXWLRQDODPHQGPHQWDSSURYHGRQ1RYHP VDV/RWWHU\&RPPLVVLRQ $/& IRUWKH¿VFDO\HDU EHUDOORZHGWKH*HQHUDO$VVHPEO\WRHV HQGHG-XQH7KH&$)5LVSUHSDUHGLQDF WDEOLVKD6WDWHRI$UNDQVDVORWWHU\ZLWKSURFHHGV FRUGDQFHZLWKWKHUHTXLUHPHQWVVHWIRUWKLQ$UNDQ XVHGWRIXQGFROOHJHVFKRODUVKLSV:LWKWKHSDVVDJH VDV&RGH$QQRWDWHG $&$ D RI$FWDQGRIWKH*HQHUDO$VVHPEO\ & 7KHVH¿QDQFLDOVWDWHPHQWVKDYHEHHQSUHSDUHG FUHDWHGWKH$/&7LFNHWVDOHVEHJDQRQ6HSWHPEHU LQDFFRUGDQFHZLWKDFFRXQWLQJSULQFLSOHVJHQHUDOO\ ZLWKWKHLQWURGXFWLRQRIIRXULQVWDQWWLFNHW DFFHSWHGLQWKH8QLWHG6WDWHVRI$PHULFD *$$3 JDPHV$/&SURFHHGVDUHXWLOL]HGWRIXQGFROOHJH IRUORFDOJRYHUQPHQWVDVSUHVFULEHGE\WKH*RY VFKRODUVKLSVXQGHUWKH$UNDQVDV$FDGHPLF&KDO HUQPHQWDO$FFRXQWLQJ 6WDQGDUGV %RDUG *$6% OHQJH6FKRODUVKLSSURJUDPDGPLQLVWHUHGE\WKH$U NDQVDV'HSDUWPHQWRI+LJKHU(GXFDWLRQ $'+( 0DQDJHPHQWLVUHVSRQVLEOHIRUWKHDFFXUDF\RIWKH ¿QDQFLDOGDWDDVZHOODVWKHFRPSOHWHQHVVDQGIDLU QHVVRIWKHLQIRUPDWLRQDQGGLVFORVXUHVZLWKLQWKLV UHSRUW7RWKHEHVWRIRXUNQRZOHGJHDQGEHOLHIWKH HQFORVHGLQIRUPDWLRQLVDFFXUDWHLQDOOPDWHULDOUH VSHFWVDQGLVUHSRUWHGLQDPDQQHUGHVLJQHGWRSUHV HQWIDLUO\WKH¿QDQFLDOSRVLWLRQUHVXOWVRIRSHUDWLRQV DQGFDVKÀRZVRIWKH$/&:HKDYHLQFOXGHGDOO GLVFORVXUHVQHFHVVDU\WRHQDEOHWKHUHDGHUWRJDLQ DQXQGHUVWDQGLQJRIWKH$/&¶V¿QDQFLDODFWLYLWLHV Kaelin Hutchinson | Newport Alyson Mueller | Newport III Arkansas Lottery Commission | 2013 CAFR PRODUCTS 7KHSXEOLFKDVWKHRSSRUWXQLW\WRSDUWLFLSDWHLQDYDULHW\RILQVWDQWDQGWHUPLQDOJHQHUDWHGJDPHVIURPPRUH WKDQ$/&OLFHQVHGUHWDLOHUVDFURVVWKHVWDWH ,167$177,&.(7*$0(6 DUHSOD\HGE\UHPRYLQJDVFUDWFKRIIFRDWLQJIURP WKHSOD\DUHDRIWKHWLFNHW7KHUHDUHYDULRXVZD\VWRZLQLQFOXGLQJPDWFKLQJ FHUWDLQ V\PEROV DGGLQJ XS WR D VSHFL¿HG WRWDO RU RWKHUZLVH VDWLVI\LQJ WKH UHTXLUHPHQWVOLVWHGRQWKHWLFNHW,IWKHVSHFL¿HGFRQGLWLRQRFFXUVWKHWLFNHW LVDQLQVWDQWZLQQHU7KHVHSOD\VW\OHVDUHFRPELQHGZLWKDYDULHW\RIJDPH WKHPHVDQGWLFNHWSULFHV,QVWDQWJDPHVZHUHWKH¿UVWW\SHRIJDPHVRIIHUHG E\WKH$/&)RU¿VFDO\HDUHQGHG-XQHZHUHOHDVHGLQVWDQWWLFNHWJDPHVZLWKSULFHSRLQWVRI DQG 7(50,1$/*(1(5$7('*$0(6 DOORZ SOD\HUV WR VHOHFW WKH QXPEHUV IRU WKHLU ZDJHU RU SOD\HUV PD\ XWLOL]HFRPSXWHUJHQHUDWHGSOD\V3OD\HUVUHFHLYHDWLFNHWZLWKWKHQXPEHUVVHOHFWHGRUDXWRPDWLFDOO\JHQ HUDWHGDQGDZDLWWKHUHVXOWVRIDGUDZLQJWRGHWHUPLQHLIWKH\KDYHPDWFKHGWKHQXPEHUVDQGZRQ:H RIIHUVHYHQGLIIHUHQWW\SHVRIWHUPLQDOJHQHUDWHGJDPHV3RZHUEDOO®0HJD0LOOLRQV®'HFDGHVRI'ROODUV 1DWXUDO6WDWH-DFNSRW&DVK&DVK)DVW3OD\$UNDQVDVDQG$53URJUHVVLYH-DFNSRW 32:(5%$//® LV D PXOWLVWDWH GUDZ JDPH MRLQWO\ RSHUDWHG E\ WKH PHPEHUORWWHULHVRIWKH0XOWL6WDWH/RWWHU\$VVRFLDWLRQDQGVROGLQ VWDWHVDQGWHUULWRULHV3OD\HUVVHOHFWRQHVHWRI¿YHQXPEHUVIURPDSRRO RIRQHWRDQGRQHDGGLWLRQDOQXPEHUGHVLJQDWHGDVWKH³3RZHUEDOO´ IURPDVHFRQGSRRORIRQHWR7RZLQWKHMDFNSRWDOOVL[QXPEHUVPXVW EHPDWFKHG7KHPLQLPXPMDFNSRWDPRXQWLVPLOOLRQZKLFKLQFUHDVHVIRUHDFKVXEVHTXHQWGUDZZKHQ