How can operators keep up with increased reporting demands?

Michael Gregory
Michael Gregory

Regular returns are not normally a guarantee when it comes to gambling. However, for all licence holders in the UK, the returns they must submit to the UK Gambling Commission (UKGC) is set to become a more regular occurrence from 1st July 2024.

Such a move is motivated by a wish to improve budgeting and forecasting “through an improved ability to understand income levels on a more regular basis”. A desire for more accurate and up-to-date information is therefore clear.  

With that in mind, now seems as good a time as any to revisit the hallmarks of reporting in the gambling industry whilst also reviewing what adaptions will have to be made in the wake of this change.

Why reporting matters

Firstly, why does reporting matter? It evidently does to the UKGC with them quadrupling the number of revenue reports they wish to receive from certain operators in a year. For other parties though it is also important:

  • Players care because the production of reports demonstrates that the companies they are customers of take their financial responsibilities seriously. Moreover, reports act as a failsafe against errors because they expose everything in black and white. As a result, they are seen as a protective measure by players.
  • Firms and the gambling industry as a whole care that all stakeholders within the sector produce reports because it builds collective trust. In addition, sharing returns reports with the UKGC is a method for communicating to them how they can be better supported by their governing body.

Ultimately, financial reporting plays a significant role within the gambling industry, ensuring player trust is sustained, that they receive the correct funds, that firms are supported properly, and more.

What must gambling firms report?

It should be noted that the new changes by the UKGC are not going to change what must be reported, just the frequency that firms must declare their returns. That means that in the UK at least, from July 1st 2024, licenced firms must report on:

  • Returns four times a year  
  • Player Liability Value (PLV) to evidence the amount of money they hold in accounts that does not belong to them (the sum of deposits by customers that are yet to be withdrawn).

In other countries you will again find regulations but it is likely that different requests are made. For instance, in Malta, Malta Gaming Association licensees must submit:

  • Yearly audited accounts
  • Interim management accounts
  • Tax returns
  • VAT returns
  • MOSS returns

However, this just covers reports that are sent to regulated bodies. Finance teams of gambling firms must also produce reports for internal purposes. The likes of Movement Reports across PSPs and banks, Fee Reports, and more are all integral for helping them with their own forecasting and for informing the reports that are sent to the UKGC.

Evidently, reporting is a major drain on available resource within finance functions in the gambling sector.

How can gambling firms meet the new reporting standards?

Shorter periods of time between submitting reports mean that finance teams will suddenly have to add reporting into their already busy to-do list a lot more often – increasing the pressure they are already under.  

To keep on top of a more frequent reporting schedule, finance teams will therefore want to get other tasks done faster. Especially those that come prior to reporting such as reconciliation – a crucial process for ensuring that data which is submitted for reports is accurate. Yet with online gambling firms processing over 11.5 million bets in March 2023 alone, reconciling these high volumes is not something that can be completed quickly. That is unless automation is deployed with the likes of Aurum which reconciles all the accounts of Peru’s largest lottery and sports betting provider, La Tinka, in under two minutes.

However, for licenced firms to stay compliant, it won’t just be a matter of completing their reports faster, they will also have to:

  • Ensure accuracy – feeding reports to those who must see them is one thing, making sure that reports are accurate, is another. Yet with the sole purpose of reports being to provide a true snapshot of a certain activity or financial position, data integrity is fundamental - something that is only possible through thorough cross-examination of transactions in the form of high-quality reconciliation. The key to this lies in automation thanks to it guaranteeing no opportunity for human error and therefore ensuring accuracy at speed.

  • Produce audit trails – reports might be an end product that regulators review; however, they can’t simply be taken at face value. Instead, more often than not audit trails will also be requested as a method for showing that the data within reports is correct and hasn’t been tampered with. Fortunately, automation platform, Aurum, not only reconciles transactions accurately without the need for human intervention, it also continuously produces a complete audit trail.

  • Stay connected – reports are the product of financial information from various sources. However, bringing intel all together into reports is firstly reliant on communication perpetually remaining open between sources. Operators therefore can’t afford for their connection to PSPs to fail.  Unfortunately, when chargebacks rack up, this is prone to happen.

    Although gambling firms can’t directly reduce chargebacks, they can protect themselves from higher rates of them and in turn increase the likelihood of connections remaining stable for them to receive the intel they need for reports. How? By Aurum generating a chargeback report for them. With data supplied by this report, payment professionals within gambling firms can make informed decisions on what PSPs to work with to reduce chargebacks.

  • Stay adaptable – the UKCG enforcing a new reporting change is just one example of the regulation goalposts moving. With a wider variety of data being generated and collected year-on-year, new regulated reports are bound to become a more common occurrence. As a result, firms should be mindful that their regulatory requirements could shift at any point and will therefore need technology available to agilely produce bespoke reports, like they can in Aurum.

  • Be aware of fees – in order to accurately share their returns with the UKGC, gambling operators must bear in mind the fees they incur due to working with PSPs. Although payment firms should tell operators what their fee rates are, changes and even errors can often go unnoticed. Consequently, if operators don’t keep up with these changes, discrepancies therefore arise between their records and those of their payment partners. That’s why Aurum calculates fees on import and compares them with what the PSP is said to be charging – making sure that data is accurate and that operators can switch PSPs if they feel their fees are no longer cost-effective.

  • Know their financial position – to provide PLV totals at any point in time, operators need to know their financial position instantaneously. This sounds majorly ambitious considering all the various ins and outs of a gaming company. However, the creation of fast and reliable journal entries with Aurum’s automation enables firms to know their financial position at any point in time.

Report update: we’re using iGaming’s no.1 reconciliation platform

For finance teams in the gambling industry, a lot of emphasis is placed on having to reconcile high volumes of transactions. Whilst there is no disputing that this is exceptionally important, the UKGC’s move to update regulations surrounding reports provides an important reminder that reporting is also a very critical part of their responsibilities.

To make sure that you back-office is operating optimally across the board – reconciling transactions in minimum time, ensuring utmost accuracy, and providing comprehesnive reports on time – you therefore need a solution that can do it all. NetBet, BetFred, PressEnter, The Tote, La Tinka, and more across the industry already do thanks to their application of Aurum. What about you?

Interested in joining the best? Book your Aurum demo today.

Michael Gregory
Michael Gregory

Business Development Manager

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Heading up one of Aurum's largest verticals, iGaming, Michael Gregory has a lot on his plate, just like the financial teams which he helps by reducing their transactional overwhelm. 

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