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Louisiana became the center of all gaming activity in the United States, and gaming underwent various periods of legalization and prohibition depending on the mood of local politics. I also wish to thank Tom Doyle for his encouragement and support and to Steve Hixon and Frank Streshley of the Nevada Gaming Control Board for help with gaming regulations and various statistics. In a departure from the earlier edition of the book, many of the statistical tables were removed, and only where the data tells an important story about the nature and the structure of the industry were they still included. This electronic revolution has changed the types of slot machines, the way they operate, and the way they are accounted for and controlled. In assessing the impact of the industry changes on the detail organization and content of the book, the following major points seem to stand out. Today only two states, Hawaii and Utah, do not have any form of legalized gambling. The modern word gambling has its roots in the Anglo-Saxon word gamnian , which means to sport or play. It is also necessary to understand the historical development and structure of the casino industry, as well as the typical organization and operation of an individual casino. The spread of tribal casinos first occurred in the upper Midwest, spread throughout the Northwest, and has culminated with the establishment of more than tribal casinos across the nation. No part of the material protected by this copyright notice may be reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording, or by any informational storage system without written permission of the copyright owner. As the United States grew, frontier laissez-faire attitudes toward gaming eventually gave way to the acceptance of widespread actions to eliminate public gambling. The material also incorporates the latest changes proposed by the American Institute of Certified Public Accountants for changes and alterations to the Gaming Industry Audit Guide. Gaming also has become the economic salvation of many Native American Indian tribes. Of course, in any industry, particularly one as dynamic as the casino industry, changes occur very quickly, and as much as possible I have tried to keep the examples general and the data relevant and up-to-date. Finally, I want to thank Cindy White for her excellent editorial suggestions and her positive contribution to the finished product. It is also interesting to note that national lotteries and various forms of pari-mutuel wagering are far more popular than casino gambling. I particularly wish to thank Sherri Winkler for her help in preparing and proofreading the manuscript. Also included for the first time is a gaming glossary to help readers understand the operating environment of a casino. Gambling today is a business, a very big business. In , the federal government approved the establishment of the National Gaming Impact Study Commission. Chapters 4 through 9 have been extensively changed. The topic of currency transaction reporting and suspicious activity reporting, both of which represent new regulatory responsibilities for casinos, is discussed extensively in the new chapter While the responsibility for the contents of the text must be mine alone, I am deeply indebted to many people for their assistance and advice as I have prepared this second edition. In the United States there were frequent lotteries as the new country was struggling for survival, and economic needs for government funds were acute. The industry now comprises riverboats, floating casinos, racinos racetracks with a casino-type operation , and governmentally operated video lottery terminals which closely resemble traditional slot machines. In addition to domestic gaming, various forms of casino gaming exist throughout the world—ranging from Bangkok to Berlin and New Zealand to Norway. All rights reserved. Casino gambling is legal in more than thirty-five countries around the world. Future growth of approved gaming is expected to continue. Legalization of new types of gaming is continuing and undoubtedly the next decade will bring a number of new jurisdictions and new types of gaming activity. Gambling of various forms was popular in western European civilizations, and card games were extremely popular in Europe during the thirteenth century. The only thing constant in the gaming industry seems to be change. The most significant change, however, has been the growing dominance of slot machines as the major revenue generating sources in most casinos, regardless of their type, ownership, or geographic location. These institutions survived the modernization of the frontier, and various forms of legal gambling were widespread in New Mexico, Arizona, Colorado, Minnesota, Idaho, Montana, and Nevada in the late s.{/INSERTKEYS}{/PARAGRAPH} Out of fifty-three domestic jurisdictions District of Columbia, Puerto Rico, and the Virgin Islands are added to the states , some form of legal gaming activity exists or is approved in the states indicated in table Appendix 1 lists the types of gaming activities on a state-by-state basis in detail. However, the report's conclusion was clearly that gaming is a part of American society today, much as it was one hundred years ago. In the last dozen years a limited and localized industry has exploded into the newest and most exciting national industry. It was expanded to include discussion of the taxation models used in other states. Gaming is also found aboard cruise ships and on many foreign U. Table illustrates the distribution of gaming revenues by type of gaming in the United States in The first casinos in the United States were undoubtedly the early taverns of New England. The term gaming is both a corruption of the word gambling and a deliberate attempt to differentiate legalized casino gambling from its illegal predecessor activities. Gambling has been accepted, encouraged, and banned. The expansion of slot machines and gaming devices has resulted in the old chapter on slot machine accounting being expanded into two chapters. The final report of the commission made a number of positive recommendations about the nature of, regulatory control over, and economic importance of the casino industry. It has been a rule that economic pressure for government revenues has often brought increased tolerance toward gambling, as illustrated in the practices in many states, both in the past and at present. The history of gambling is also the history of public acceptance of the various games of chance that form the basis of gambling. Great Britain and Australia have extensive gaming based on slot machines or amusement with prize AWP machines. They also pointed out some of the problems with compulsive gaming behavior and other adverse impacts on some casino-related business. The chapter on keno, bingo, and poker has been split into two chapters, and the increasing importance of poker gaming is discussed in the new chapter 9. Figure graphically indicates the status of gaming in the United States. {PARAGRAPH}{INSERTKEYS}Malcolm Greenlees. During the latter part of the century, this drove the remaining professional gamblers even further west with the new settlers. There had been some concern that the tables used in the first edition were very quickly out-of-date. In examining the history of casino gaming, one must first secure an understanding of gambling of all types. Coincident with the growth of the number of slot machines and their revenue dominance has been the continued evolution of various slot machine games. The book has been enlarged from thirteen to fifteen chapters. This oversight is exercised by states, by tribal gaming authorities, and by the casino operators themselves. The second edition of Casino Accounting and Financial Management represents both an updating and an expansion of the original text published first in In the intervening years, the casino industry has experienced both unprecedented growth and change. Another major change in the industry involves the additional forms of casino gaming which have occurred since the publication of the first edition. Chapters 1 and 2 have been substantially enlarged and updated to reflect the changes in the industry outlined above. The West had fostered many frontier locations, originally designed for the rough-and-ready entertainment that gambling provided. Chapter 6 discusses the accounting for slot machine transactions, and covers the new forms of play including ticket-in—ticket-out technology, as well as the accounting and control over bill acceptors or bill validators. Income tax topics now include tip reporting responsibilities and customer reporting requirements. American Indians were enthusiastic gamblers for centuries before the discovery of the New World. The first recorded banning of card games was in , when John I, the king of Castile, prohibited card playing because of heavy financial losses by members of his court. By , an industry trade group studying the impact of gaming as an entertainment activity indicated that the gaming industry had more attendees than movies! The word gaming also focuses on the air of sport and minimizes the negative emotional aspects of excessive risk taking sometimes associated with gambling. The last twelve years have seen quantum leaps in gaming technology, innovative games, and significant new casino accounting and finance issues. Although the procedures for the basic accounting and finance transactions have not changed significantly since the first edition, there have been many evolutional steps involving slot machines in particular. Even the state of Hawaii periodically considers adding gaming casinos as a solution to limited state funding sources. This scenario was repeated on a similar basis in most developing population centers of the country. Chapter 3 has been updated and rewritten to clarify the role of gross revenue taxation in casino operations. The spread of gaming to other state jurisdictions has resulted in a much broader discussion of the gaming regulations, rules, and practices in states other than Nevada and New Jersey. Games such as bingo have achieved widespread popularity in the United States, Canada, and England. Chapter 5 describes the nature, type, and general operation of slot machines and other gaming devices. The spread of legalized gaming has also led to increased regulatory oversight. The chapters on central cashiering and casino credit have been modestly updated to reflect current practice. The chapters on income taxation and managerial accounting have been updated. Following the Civil War, the southern states instituted state lotteries to assist in rebuilding depleted state treasuries. Chapter 12 now encompasses casino accounting, auditing, and financial reporting, which has continued to evolve over the years. Gambling is as old as man himself. Managerial accounting has also been upgraded and broadened to include discussion of new techniques to allow casino personnel to do a better job of internal financial management. Around , the French contributed the style of cards which has become the world standard. To understand the details of casino accounting, it is necessary to understand the overall operating environment in which the accounting and finance takes place. Special thanks go to my former students Michelle Lanourette and Dan Davison for their help in scanning and preparing early drafts of the text and to Michael Harrison for his help with games chapters and the gaming glossary. In the absence of revenue taxation in tribal gaming, there is little need for the discussion of taxation in the tribal environment. The industry has evolved to include traditional commercial interests as well as including state governments and Native American tribal casino operations. A major addition to the text includes discussions of the role of currency transaction reporting and increasing information reporting to various agencies. The control over and use of electronic and computerized control procedures has also been expanded. Gambling was practiced in India and Greece long before the birth of Christ. These taverns were set up with card games, and other activities were accepted as a regular part of the social fabric of the day. Appendix 2 indicates the growth of gross annual wager from through , a period of just five years. As thousands of men poured westward, many early boomtowns had only two industries: saloons and casinos. The industry has spread geographically—from what was a commercial industry spanning just two states—to an industry which is nationwide in the United States, with significant international gaming activity as well. Increasingly, as new international gaming locations are approved, United States gaming companies and personnel are frequently involved in this newest form of international business. The gaming business has experienced unprecedented growth—both in existing as well as new jurisdictions.