BASIS AND PURPOSE FOR AMENDMENTS TO RULE 1
The purpose of amendments to Rule 1 is to present definitions of various terms used throughout the rules of the Colorado Limited Gaming Control Commission so that the rules can be uniformly applied and understood. The statutory basis for Rule 1 is found in sections 12-47.1-201, C.R.S., 12-47.1-203, C.R.S., and 12-47.1-302, C.R.S.
RULE 1	  GENERAL RULES AND REGULATIONS
47.1-106	Definitions. 
The following definitions of terms, in addition to those set forth in section 12-47.1-103, C.R.S., shall apply to all rules and regulations promulgated pursuant to article 47.1 of title 12, of the Colorado Revised Statutes:
The following definitions of terms, in addition to those set forth in section 12-47.1-103, C.R.S., shall apply to all rules and regulations promulgated pursuant to article 47.1 of title 12, of the Colorado Revised Statutes:
(12)	“Free play” in relation to promotional items, means the use of a coupon that is issued to a patron by an establishment for slot machine play for which no bet is required;
(20)	“Matched play” in relation to promotional items, means the use of a coupon at table games that is issued to a patron by an establishment for play that must be accompanied by a bet;
(28)	“Token” means a metal, paper or other approved material representative of value, redeemable for cash, issued and sold by a licensee for use at in gaming; and (47.1-106(28) amended perm. 10/30/99)
(29)	“Wager” means a sum of money or thing of value risked on an uncertain occurrence. Credit and debit cards are not considered wagering instruments and cannot be used in conjunction with limited gaming.

BASIS AND PURPOSE FOR AMENDMENTS TO RULE 8
The purpose of amendments to Rule 8 is to establish wagering rules for blackjack. The statutory basis for amendments to Rule 8 is found in sections 12-47.1-201, C.R.S., 12-47.1-203, C.R.S., and 12-47.1-302, C.R.S.
RULE 8`	RULES OF BLACKJACK
47.1-809 	Wagering rules.
Except when splitting pairs, doubling down, surrendering, or making an insurance wager, no wager may be increased, decreased, or withdrawn after the first card of a round has been dealt. All wagers at blackjack must be made by placing gaming chips, tokens, coins, valid free play coupons, valid match play coupons, or any combination thereof, on the appropriate areas of the blackjack layout. (47.1-806 renumbered as 47.1-809 and amended, perm. 12/30/98)

BASIS AND PURPOSE FOR AMENDMENTS TO RULE 16
The purpose of amendments to Rule 16 is to establish accounting and internal control procedures for licensees. The statutory basis for these requirements is found in sections 12.47.1-201, C.R.S., 12-47.1-203, C.R.S., and 12-47.1-302, C.R.S.
RULE 16	ACCOUNTING REGULATIONS
47.1-1602	Accounting and financial records. 
(1)	Each licensee must keep accurate, complete, legible, and permanent records of all transactions pertaining to revenue that is taxable or subject to fees under Article 47.1 of Title 12, C.R.S. A licensee who keeps permanent records in a computerized form or imaging system on microfiche must provide the Division, on its request, with a detailed index to the imaging system microfiche or computer database record. All such records must be made available upon demand to employees of the Commission and Division.
(2)	Each licensee must keep general accounting records on a double entry system of accounting, maintaining necessary detailed, supporting, subsidiary records, including:
(a)	Detailed records identifying revenues, expenses, assets, liabilities, and equity for each establishment;
(b)	Detailed records of all returned checks;
(c)	Slot and table game statistical reports and supporting documentation as required by the internal control minimum procedures;
(d)	The records required by the internal control minimum procedures, as approved by the Division, applicable to the licensee;
(e)	Journal entries prepared by the licensee and adjustments proposed by its independent accountant; 
(f)	Any other records that the Division specifically requires to be maintained; and
(g)	All tax returns relating to the licensed establishment.
(3)	Each licensee must create and maintain detailed records sufficient to accurately reflect adjusted gross proceeds, and expenses relating to its operations on a monthly and year-to-date basis, as well as financial statements.
(4)	If a licensee fails to keep the records used by it to calculate adjusted gross proceeds, the Division may compute and determine the amount of taxable proceeds upon the basis of an audit conducted by the Division, upon any information within the Division’s possession, upon statistical analysis or projections, or by other means determined by the Division based on best information available. (47.1-1602 amended perm. 10/30/99)
47.1-1603	Adjusted gross proceeds computations. 
(1) 	For each blackjack game, adjusted gross proceeds equals the closing bankroll plus credit slips for cash, chips, or tokens returned to the casino cashier cage, plus drop, plus face value of coupons less fifty (50) percent of face value of coupons, less opening bankroll and less fills to the table.
(2)	For each slot machine, adjusted gross proceeds equals drop plus tickets dropped cashless gaming system’s electronic in less fills to the machine, less hand pay jackpot payouts and accumulated credits, and less tickets redeemed cashless gaming system’s electronic out. The initial hopper load is not a fill and does not affect adjusted gross proceeds. The difference between the initial hopper load (or the amount in the hopper at the time of the previous hopper count if the coins/tokens counted were returned to the hopper) and the total amount that is in the hopper at the time the hopper is currently counted must be adjusted accordingly as additional revenues or a credit adjustment when calculating adjusted gross proceeds. This amount is reported on the monthly gaming tax return for the month in which the hopper count was conducted, and is reflected in the hopper adjustment column for the corresponding denomination. Hoppers must also be counted and the corresponding adjustment reflected on the gaming tax returns at other times as specified in the internal control minimum procedures. If a licensee does not make or makes inaccurate additions or subtractions when calculating adjusted gross proceeds, the Division may compute an estimated total amount in the slot machine hoppers and may make reasonable adjustments to adjusted gross proceeds during the course of an audit, review, or other examination procedures.  (amend. perm. 03/30/02)
(3)	For each player banked poker game, adjusted gross proceeds equals all money received by the licensee as compensation through the rake process, for conducting the game, plus poker tournament entry fees exceeding winnings paid out to tournament players any accounting or administrative fee for offering poker jackpots. (47.1-1603(3) amended; perm. 11/30/96)
(4)	For each house banked poker game, adjusted gross proceeds equals the closing bankroll plus credit slips for cash, chips, or tokens returned to the casino cashier cage, plus drop, plus face value of coupons less fifty (50) percent of face value of coupons, less opening bankroll, less fills to the table, and less hand-paid jackpots or awards. (47.1-1603(4) (shill computations) deleted; new (4) added, perm. 11/30/96)
(5)	A licensee shall not exclude from adjusted gross proceeds money paid out on wagers that are knowingly accepted by the licensee in violation of Article 47.1 of Title 12, C.R.S., or the regulations thereunder of the Commission.
(6)	Returned and uncollectable checks are not allowed as a deduction from adjusted gross proceeds. (47.1-1603 amended perm. 10/30/99)
(7)	A licensee shall not exclude from adjusted gross proceeds money paid out on wagers that exceed the value of the winning combination posted unless previously approved by the Division.
47.1-1607	Records retention - noncompliance. 
Each licensee must provide the Division, upon its request, with the records required to be maintained. Licensees must maintain accurate and complete records as required in the internal control minimum procedures. Each licensee is responsible for the acts and omissions of its agents, employees, and contractors in complying with all obligations imposed by law, these rules, and internal control minimum procedures. Each licensee must retain all such records within Colorado for at least three years after they are made and the related gaming tax return is filed. Records include but are not limited to formats as hard copy documents, revenue system database, tables and fields structures of the database, meter files, and electronic reports.  Failure to keep and provide such records is an unsuitable method of operation and subject to a fine, penalty, or revocation of license. (47.1-1607 amended perm. 10/30/99)
47.1-1608 	Commission examination procedures.
(1)	The Division of Gaming shall:
(a)	Conduct periodic examinations of the accounting and financial records of licensees, including but not limited to revenue, systems, and compliance audits;
(b)	Review the accounting principles and procedures used by licensees;
(c)	Review and observe methods and procedures used by licensees to count and handle cash, chips, tokens, gaming coupons, hopper tickets, gaming wagers, gaming payments, and negotiable instruments;
(d)	Examine licensees’ internal control procedures;
(e)	Examine accounting and financial records of the licensee or a person controlling, controlled by, or under common control with the licensee, within the licensee’s establishment or licensee’s other establishments located in Colorado, or other locations as agreed to with the licensee;
(f)	Examine the accounting and financial records of any licensee when conditions indicate the need for such action or upon the request of the Director or the Commission; 
(g)	Investigate each licensee’s compliance with the Colorado Limited Gaming Act of 1991, the regulations of the Commission, and internal control minimum procedures as directed by the Director; and
(h)	Review tax returns, tax records and tax adjustments.
(2)	The Division may conduct an audit, a review, or other examination procedures in conformity with the examination procedures established by the Division. The Division shall prepare a report, as appropriate for the examination conducted, at the conclusion of each examination for submission to the Commission. (47.1-1608(2) temp. 5/13/92, perm. 6/30/92)
(3)	At the conclusion of each examination, and prior to submitting the report to the Commission, the Division shall review the results of the examination with the licensee. If the licensee disagrees with the Division’s report, the licensee may, within 10 days of the examination, submit written comments to the Division as to why the results of the examination should not be submitted to the Commission for acceptance. If the Division and the licensee cannot reach an agreement on the report, the Commission shall consider the Division’s report and the submission of the licensee’s response prior to its determination of its acceptance of the report.
(4)	When the Division finds that the licensee is required to pay additional fees and taxes or finds that the licensee is entitled to a refund of fees and taxes, it shall report its findings, and the legal basis upon which the findings are made, to the Director and to the licensee in sufficient detail to enable the Director to determine if an assessment or refund is required. (47.1-1608 amended perm. 10/30/99)
47.1-1613	Promotional items. 
(1)	A licensee who engages in promotions to increase business and gaming at his business may not deduct payouts made pursuant to the promotion from adjusted gross proceeds except for money or tokens paid at face value directly to a patron as the result of a specific wager. Licensees must receive prior approval from the Division prior to offering and paying such additional funds  as a result of a specific wager as outlined in the internal control minimum procedures.  A specific wager requires two or more persons to stake something of value on an event, the outcome of which is uncertain. Depending upon the outcome, the winning party receives everything that was staked. If only one party risks something of value, there is no wager. 
(2)	No deduction is allowed in the computation of adjusted gross proceeds for any prizes, premiums, drawings, benefits, or tickets awarded as promotions that are redeemable for money, merchandise, or other promotional allowances. (47.1-1613(2) amended perm. 10/30/99)
47.1-1614	Free play coupons items. 
Free play coupons items are allowed, but once used may not be retained for subsequent play by the customer. Free play coupons and resulting payments to players for slot machines are not included in the calculation of adjusted gross proceeds. Free play coupons do not apply to table games of blackjack or poker.  When a free play item is used, the fills to the game must be increased by 50 percent multiplied by the total dollar value of the free play item as listed in the count. The total face value of the coupons must be reflected on the soft count card as a part of the drop. A free play coupon must have printed on it the name of the issuing establishment, the city in which the establishment is located, explanation of its use, and the monetary worth of the coupon. All coupons must have an expiration date printed on them. (47.1-1614 amended perm. 10/30/99)
47.1-1615	Match play coupons items. 
Match play coupons items are allowed, but once used may not be retained for subsequent play by the gaming patron. Match play coupons do not apply to slot machines.  When match play promotional coupons items are used in blackjack and poker a game, the value of the coupon item must increase fills by 50 percent, and the promotional item must be reflected at its face value in the total drop amount for that table for that shift count. The combination of the match play coupons and the required wager of the patron cannot exceed the value of $5.  The patron must match the dollar value of the match play coupon.  A match play coupon must have printed on it the name of the issuing establishment, the city in which the establishment is located, its value, and an explanation of its use. No coupon may be issued which authorizes payments greater than two-for-one to gaming patrons. All coupons must have an expiration date printed on them. (47.1-1615 amended perm. 10/30/99)