Reporting requirements for net proceeds

Reporting on net proceeds is now required annually, as part of a corporate society’s licensing process, rather than monthly.

This replaces monthly reporting requirements introduced in November 2020 to monitor changes to the rules around distributing net proceeds, in particular societies’ compliance against the 1.5:1 Working Capital Ratio (WCR).

Corporate societies must continue to calculate their WCR quarterly, but do not need to report quarterly calculations to the Department.

These requirements apply to corporate societies that mostly distribute and corporate societies that mostly apply (clubs), if they have a WCR licence condition approved.

Further information

Compliance investigations and audits
Email gambling@dia.govt.nz

Monitoring net proceeds

Monthly reporting requirements were introduced in November 2020 to monitor changes to the rules around distributing net proceeds. These changes follow the amendments to the Net Proceeds Regulations.

On this page

• Monthly reporting requirements
• Using the DIA data collection template
• Further information

Monthly reporting requirements

Monthly reporting requirements (known as the monitoring framework) were introduced in November 2020 to monitor changes to the rules around distributing net proceeds, in particular societies’ compliance against the 1.5:1 Working Capital Ratio (WCR).

WCR is calculated as total current assets divided by current liabilities. Societies may withhold net proceeds from distribution providing the WCR does not exceed a maximum of 1.5:1.

We are also monitoring:

• The level of distributions by societies during the 2020 and 2021 suspension of Regulations 10 (1) and 11.
• Any unintended consequences that may result from the changes.

This monitoring relates to amendments to the Gambling (Class 4 Net Proceeds) Regulations that were introduced on 1 July 2020. Any previous arrangements regarding retention of net proceeds for the purposes of financial viability are superseded.  Any retention of net proceeds is governed solely by the amendments, specifically Regulations 10, 11 and 11A.

Gambling (Class 4 Net Proceeds) Regulations 2004 – see sections 10 (1), 11 and 11A.

Applying or distributing net proceeds

What data we are collecting

We are collecting four main pieces of information each month. These are detailed below.

Information we collect	Description
Total current assets	Anything that would be treated as a current asset in your annual accounts. Cash and other assets that are expected to be converted to cash within a year. For example accounts receivable, proceeds not yet banked and cash at the bank. Current assets do not include fixed assets such as gaming machines.
Total current liabilities	Anything that would be treated as a current liability in your annual accounts. Amounts due to be paid to creditors within twelve months. For example accounts payable, overdraft facilities, tax payable Any amounts approved as grants but not yet distributed are to be treated as a current liability.
Distributions for the month	The amount, net of refunds, that has been distributed to or for authorised purposes Distributing net proceeds
Gaming machine profits	Profits made from gaming machines (the turnover of the gambling, less prizes, plus interest or other investment return on that turnover, plus any gain above the book value from the sale or disposal of gambling assets). Does not include GST.

DIA reporting

A monthly and quarterly summary report and high-level commentary will be reviewed each month by the Gambling Outcomes Advisory Board. The Department also intends to report periodically to the Minister on the impact of, and compliance with, the regulatory amendments.

Using the DIA data collection template

Societies have received the DIA data collection template to collect monthly data. Data collection began from September 2020.

Data for each month should be added to the same spreadsheet so we can assess cumulative data.

Each month you need to:

1. Enter your data into the DIA supplied spreadsheet

2. Complete the declaration

3. Label the spreadsheet according to the naming convention outlined below

4. Email the completed spreadsheet to gambling@dia.govt.nz (subject line: Net proceeds monitoring: [Society name; year; month]).

Naming convention

The labelling protocol to be used is as follows:

• Society Name-MMM YYYY.xlsx
• For example, ABC Society-Sep 2020.xlsx

* NB The month should be the first three letters only.

Timing

Societies have three weeks from the end of the reporting month to submit data for the previous month.

The template must be submitted by 21st of the month following the reporting month.

For example: submit January 2021 data by 21 February 2021.

The December 2020 deadline extends to 31 January 2021 to allow for the Christmas period.

Further information

Compliance investigations and audits

Email gambling@dia.govt.nz