Md. Code Regs. 36.10.13.04

Current through Register Vol. 51, No. 17, August 23, 2024

Section 36.10.13.04 - Review of Internal Controls

A. At least 60 days before sports wagering operations are to commence or another timeframe as approved by the Commission, a sports wagering licensee shall submit its internal controls to the Commission for review and written approval.

B. The internal controls shall be accompanied by:

(1) A certification by the sports wagering licensee's chief executive officer or chief legal officer that the submitted internal controls conform to the requirements of State Government Article, Title 9, Subtitle 1E, Annotated Code of Maryland, and this chapter;

(2) A certification by the sports wagering licensee's director of finance that the submitted internal controls:

(a) Establish a consistent overall system of internal controls;

(b) Provide reasonable assurance that financial reporting conforms to generally accepted accounting principles in the United States; and

(c) Conform to the requirements of State Government Article, Title 9, Subtitle 1E, Annotated Code of Maryland, and this chapter; and

(3) An opinion letter by an independent certified public accountant expressing an opinion as to:

(a) The effectiveness of the design of the submitted system of internal controls over financial reporting;

(b) Whether the submitted system of internal controls conforms to the requirements of State Government Article, Title 9, Subtitle 1E, Annotated Code of Maryland, and this chapter; and

(c) If applicable, whether a deviation from the requirements of State Government Article, Title 9, Subtitle 1E, Annotated Code of Maryland, or this chapter identified by the independent certified public accountant in the course of its review of the submitted system of internal controls is material.

C. A sports wagering licensee may not commence operations until its internal controls are approved in writing by the Commission.

D. If the Commission determines that a submitted internal control is deficient, the Commission shall:

(1) Provide the sports wagering licensee with written notice of the deficiency;

(2) Require the sports wagering licensee to revise the internal control as appropriate; and

(3) Request the sports wagering licensee to resubmit the internal controls to the Commission for review and approval.

E. A sports wagering licensee may not implement a change or amendment in its approved internal controls without the prior written approval of the Commission.

F. A sports wagering licensee's initial internal controls submission and a change or amendment to its approved internal controls shall be reviewed and approved in accordance with a process and time frame developed and implemented by the Commission.

G. The process developed by the Commission under §F of this regulation shall, at a minimum, require the sports wagering licensee to:

(1) Submit a redlined copy of any section of the approved internal controls to be changed or amended with added text underlined and deleted text lined out;

(2) Document on the redlined copy the date the Commission approved the section to be changed or amended and the date the revision was submitted to the Commission for review;

(3) Submit a narrative explaining the reason for the change or amendment which includes the sports wagering licensee's target date for implementation;

(4) Submit the written representations required in §B(1) and (2) of this regulation with regard to the proposed change or amendment; and

(5) Mark each page of approved internal controls with the date on which it was approved by the Commission.

Md. Code Regs. 36.10.13.04

Amended effective 49:1 Md. R.16, eff. 1/13/2022