Report No. 2007-23

May 2007

The following issues were noted in an audit conducted by our office of the Department of Revenue, State Lottery Commission.

The State Lottery Commission (SLC) was created June 11, 1985, following voter approval of a lottery amendment to the Missouri Constitution at the November 1984 general election.  State law provides that money received from the sale of lottery tickets shall be divided with a minimum of 45 percent to be awarded as prizes; administration, advertising, promotion, and retailer compensation costs shall be paid as appropriated by the General Assembly; and the remainder shall be transferred to the Lottery Proceeds Fund to be appropriated solely for public institutions of elementary, secondary, and higher education.

Follow-up on a recommendation from a separate audit that reviewed the cost of promotional items of all state departments (Report No. 2004-55) found that the State Lottery Commission continues to sponsor various private organization events.  Our office reviewed two payments to private organizations totaling $60,000 and seven purchases of promotional items totaling approximately $57,000 that were not approved by the lottery's promotional department.  There were either no proposals on file or the proposals from the private organizations did not indicate the benefits the SLC would receive from the sponsorships.  According to SLC management, all sponsorships are now processed by the promotional department, which requires a formal written proposal.

We had no new findings on the State Lottery Commission.

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