It’s Not Easy Running a Lottery

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It’s Not Easy Running a Lottery
  • Author:
    William Monroe
  • Published:

a look at what it takes to run a lottery

A lot of lottery players seem to be a bit jealous of the lottery operators. They feel that the people who run the lottery have locked into a super easy way of making billions of dollars a year just by sitting on their butts. And yes, it might seem easy to run a lottery, but in reality, it is extremely difficult to do. It’s not just simply creating a lottery game, advertising it, selling tickets, and paying out a small amount of winnings while keeping the rest as a pure huge profit.

Most lotteries are state or government run

Lotteries are actually run by state or provincial governments that ensure the lotteries and draws are honest and transparent. They have to ensure that everything they do is to the letter for the overseer, the state or provincial gaming commission. If they are off on anything that does not comply with every rule, every regulation, then severe monetary or criminal penalties are waiting. And everything means everything, from advertising to equipment security. This puts a very stressful load on every employee, manager, and director.

Even one little mistake on the Operator’s part can cost a whole lot of money in fines, like in the realm of millions to tens of millions of dollars. The Operator can't just advertise their lotteries willy nilly anyway they wish. Many rules and regulations dictate many things like how, where, and when the operator can advertise their lottery, percentages of income that must be diverted over to charities, procedures to secure lottery equipment, and recordings and audits of each and every draw. Even the type paper that the ticket is printed on at retailers is subject to many regulations dictated by the gaming commission, and only certain suppliers of lottery equipment can be used.

An accounting nightmare

And of course the most difficult aspect of running a lottery is the enormous accounting nightmare that ensues from the constant flux of money coming in and going out. This type of accounting is not for the faint of heart, and lottery accounting departments have many different sub-departments and accounting people to tackle the job. Imagine having to track and account for every cent coming in from ticket sales such as where each cent is coming from, when was the ticket sold and for how much, does the amount remitted by a retailer coincide with the number of tickets sold, and does this information match what is in the computer system and manually provided by the retailer?

Then there is the need to do the accounting for all the money that is paid out to charities. Who gets what amount and when? Oh yes, and salaries and wages paid out to staff have to be put through payroll. And then the overtime, benefits, etc. And we can’t forget the money paid out in winnings. Not only does this money need to be divided up for each game but must be put aside and held so that it is immediately available to be paid out to players when they redeem their winning ticket.

With so much at stake in holding just one draw, the potential for disaster is always around the corner for the Operator. So no, it’s not easy to run the lottery and in fact can be a nightmare for everyone involved. This not a sit on your butt type of industry. This is a difficult and extremely varied business that is quite stressful and keeps everyone involved constantly on their toes.

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