...Marshall School of Business University of Southern California Controls at the Bellagio Casino Resort Teaching Note Purpose of Case The Controls at the Bellagio Casino Resort case was designed with several purposes in mind. First, it illustrates a control system that is dominated by action and personnel controls, rather than results controls. The analysis of this system leads to insights about some of the factors that limit the feasibility of results controls. Second, the case can lead into a discussion of what is meant by the term “tight control.” The case presents an excellent example of the application of tight action controls in the table games areas of the casino. Finally, the case can lead into a discussion of the meaning of what auditors refer to as “internal control,” which is a subset of the broader area of management control. The case describes an excellent system of controls over cash and cash-equivalent stocks and movements thereof. These controls, which fall in the category of internal controls, are necessary but not sufficient to guarantee good management control. Suggested Assignment Questions Since the case can be used for several purposes, the assignment can be slanted in several ways. The following is one list of questions that might be used 1. Focus on three key roles at mainly three levels of authority in the casino – blackjack dealers, pit bosses, and the vice president of table games. How would you characterize the “control strategy”...
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...Strict controls on recording of receipts and amounts disbursed (A) Same as above Strict controls over issuance of credit as well as the limits (A) Only issue credit to people they know should be able to pay them back Controls over Cash and Credit List of the controls Problem being addressed Very tight security and supervision in count rooms (minimum 3 people in room until amount transferred and accepted) (A) Less chance of individual theft with several qualified people watching Control of Games List of the controls Problem being addressed Strict licensing rules established by Nevada Gaming Control Board (GCB) on hiring employees (P) Being as sure as possible to only hire qualified employees Bellagio perform own employee screening on top of GCB to avoid hiring people involved in crimes or violation of casino rules (P) Be sure to not hire employees that have no history of theft within the casinos...
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...The Bellagio has extensive controls in place in order to ensure the smooth operations of their hotels and casinos. Most of the controls put in place at the Bellagio consist of action and personnel controls; not a lot of results or cultural controls seen. The gaming industry is heavily regulated so many controls have to be put in place anyway as required by regulatory bodies, however the Bellagio has gone above and beyond the required amount. Some of the action controls that we see being employed at the Bellagio are: • Daily cash count • 2000+ surveillance cameras that record footage at each table and all casino surroundings • Strict record keeping procedures and daily reconciliations • Dual or triple supervision when transferring cash or cash equivalents • Pocketless uniforms to prevent hiding cash • Extensive supervision of gamers, dealers and all personnel handling cash • Cash cage, lock boxes and specific procedures for handling cash • Being aggressive on collection of receivables • A lot of redundancy so they are never short staffed and security remains high Some of the personnel controls that we see are: • Only hire experienced staff • Thorough screening process of potential hires • Extensive training of employees • Licensing of casino staff • Good job design: giving staff 20 minutes break each hour Cultural controls: • Reporting suspicious transactions • Reporting any transaction over $10 000 Results controls: • Upper management bonuses...
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...Individual reflection #2: Controls at the Bellagio Casino Resort What controls do they have and why? MGM MIRAGE maintained stringent controls on the recording of all receipts and disbursements. In the (Bellagio) casino, these controls included: - Locked cash boxes on the casino floor; - Daily cash and coin counts performed by employees who were independent of casino operations; - Constant observation and supervision of the gaming area; - Observation and recording of gaming and other areas by closed-circuit television; - Timely analysis of deviations from expected performance; - Constant computer monitoring of slot machines. These controls help to ensure that cash operations are going well. The company’s businesses were also subject to various other federal, state, and local laws and regulations in addition to gaming regulations. These laws and regulations included, but were not limited to, restrictions and conditions concerning alcoholic beverages, environmental matters, employees, currency transactions, taxation, zoning and building codes, and marketing and advertising. Multiple forms of control were required by the Nevada Gaming Control Board (GCB) and used in the Bellagio to help ensure that the casino kept the cash to which it was entitled. These included: - licensing of casino personnel (gaming work permit valid for 5 years); - standardization of actions of personnel running the games; - careful supervision and surveillance of the actions taking place at the table; - monitoring...
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...Qantas Airways Ltd: A case study for Financial Statement Analysis Peter Wells* and Anna Wright. 12 February 2004 Not to be used or cited without the permission of the authors * Corresponding author: School of Accounting, University of Technology, Sydney, Broadway NSW 2007 Australia Tel: 61-2-9514 5295 Fax: 61-2-9514 5515 Email: peter.wells@uts.edu.au 6. Financial Analysis The aim of financial analysis is to present and summarise information contained in the financial statements in a manner that facilitates an understanding of the activities of the firm, and ultimately, forecasting future period financial statements. 6.1 Reformatting of financial statements A major problem with general purpose financial reports is the intertwining of the operating (and investing) and financing activities of the firm. Furthermore in the accounting analysis previously undertaken (section 5) accounting practices will be identified that are considered inappropriate or that obscure actual firm performance. These issues can be addressed through the reformatting or recasting of the financial statements of the firm. A consequence of the intertwining of the operating and financial activities of the firm is that summary measures of firm performance will reflect both operating and financial activities and management decisions, with this making interpretation of such measures problematic. Accordingly, a necessary first stage of financial analysis is the separation of...
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...Bellagio Casino and Resort 1. Briefly describe the objective(s), strategy and control problems faced in the organization. Bellagio Casino and Resort has its own challenges within the establishment of gaming, entertainment, conference, dining and accommodation products. One of its main objectives is to capture the high-end luxury clients who are looking for a holiday outing and features. These clients are out to spend, and this poses a great opportunity for Bellagio's strategy. Bellagio strategy focuses on diversification of the corporate business investing in a wide range of luxury products. The business unit competitive strategy design allows for low-cost pricing of the products and prices, presenting a competitive edge over the rest of the similar organizations. Some of the control problems that affect Bellagio are the pace of technological advancements in the entertainment and gaming industry. (Askew, 2011) The control challenges that face the organization include the political and economical climate within the local and international industry. Similar companies are venturing into the business posing the risk of completion within the market for suppliers, customers, and regulators. Bellagio faces the risk of high uncertainty in the casino business, and it is quite difficult to predict the optimal targets. [pic] Figure: Bellagio Casino and Resort Corporate Diversification Strategy 2. Describe contingent factors (as discussed in seminar 12) that are relevant in the...
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...the operation | Livingston Dell | An electronics and surveillance expert | Saul Bloom | An elderly con man | Linus Caldwell | A young and talented pickpocket | Basher Tarr | An explosives expert | Virgil | Mechanics | Turk Malloy | Mechanics | Yen | An accomplished acrobat | Terry Benedict – owns all the three casinos (Bellagio, The Mirage, and the MGM Grand) Tess – Ocean’s ex-wife, Benedict’s girlfriend WHAT Ocean and his team are going to rob the Bellagio, The Mirage, and the MGM Grand casinos which own by Terry Benedict. Where The vault at the Bellagio, where the money of casinos from The Bellagio, The Mirage, and the MGM Grand casinos will end up here. When On a weekend, the money inside the vault at the Bellagio would more than any weekday. Especially on the fight night, the money in will be at least $150 million. So they planned to take action on the fight night. WHY Their motives of robbing the casinos are different among them. It’s included, love, hatred for the owner of casinos, money, boring to their life, off the job for long period. HOW Several of the team members carry out reconnaissance at the Bellagio to learn as much as possible about the security, the routines and behaviors of the casino staff, and the building itself. Others create a precise replica of the vault with which to practice maneuvering through its formidable security...
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...Case #1 Michael Benavides Controls at the Bellagio Casino and Resort The Bellagio Casino and Resort is owned by the MCM Mirage and is one of the 23 properties that they own. The Bellagio is one of the world’s most premier casino resorts. With it they have up to 4,000 employees working 24 hours a day, every day of the year. Of the 4,000 employees 1000 of them work in finance organization, reporting directly to the executive vice president/CFO. The casino consists of 2409 slot machines and 143 gaming tables inside the in 2,000 square foot convention space. In the casino and resort industry they are a very competitive environment and are high regulated by the state of Nevada. The Bellagio consists of two separate profit centers. One profit center is the gaming operations with table games (blackjack, baccarat, craps, roulette, keno, and poker) and the slot machines. The second profit center is the non-gaming operation which is made up of rooms, food and beverage, entertainment, retail and other, and non-casino revenue. With the industry changing so much as it is Bob Rudloff (vice president of internal audit) explains that “People don’t just come to Vegas anymore to gamble; rather, they are attracted by shopping, dining, spas, shows, and entertainment. This has resulted in a shift in revenues from gaming to non-gaming. Strategically, however, our business is not just about controlling the gaming part of revenues any longer. 1.) Focus on three key roles at mainly three levels...
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...ANALISIS KASUS THE BELLAGIO CASINO RESORT Makalah yang disusun untuk melengkapi Tugas Mata Kuliah Sistem Perencanaan dan Pengendalian Manajemen Semester V Disusun oleh: aRIEF AHMAD Junaidi (12121010) Gerry Sampurna Sule (12121026) Putri Faradita (12121044) RIRIS FRISKA (12121045) SEPTI NURRAHMAH (12121047) ANDIKA CHAIRUNNISA (12121058) PRISCA PUTRI (12121066) UNIVERSITAS TRILOGI Program Pendidikan Studi Strata-1 Jurusan Akuntansi JAKARTA 2014 KATA PENGANTAR Puji syukur kami panjatkan kehadirat Allah SWT karena berkat rahmat dan karunia-Nya kami dapat menyelesaikan tugas makalah ini dengan lancar dan sebaik-baiknya. Kami sadar bahwa tanpa campur tangan-Nyalah usaha kami tidak berarti apa-apa. Kami selaku penyusun makalah tentang “KETATNYA SISTEM PENGENDALIAN” ini mengucapkan rasa terima kasih kepada Dosen Manajemen Sistem Perencanaan dan Pengendalian Manajemen yaitu Ibu Novita yang telah mengajar dan mendidik kami sehingga kami dapat menyelesaikan tugas ini dengan baik. Terima kasih juga kami ucapkan kepada teman-teman yang telah mendukung dan memberi motivasi sehingga tugas ini dapat terselesaikan dengan baik dan tepat waktu. Semoga makalah ini bermanfaat bagi siapa saja yang membacanya. Terima kasih. Jakarta, 09 Oktober 2014 Hormat Kami, (Penyusun) DAFTAR ISI KATA PENGANTAR i DAFTAR ISI ii BAB I PENDAHULUAN 1.1 Latar Belakang 1 1.2 Perumusan Masalah 2 1.3 Tujuan Penulisan 2 1.4 Manfaat Penulisan...
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...Activity 15 The Bellagio casino and resort is a diverse organisation offering products in a range of areas including gaming, entertainment, conferences, dining and accommodation. Address the following questions in relation to this case: 1. Briefly describe the objective(s), strategy and control problems faced in the organization. Objectives: The Bellagio Hotel and Casino is designed with a wealth of amenities designed to differentiate itself from the competition. Richly appointed rooms and suites, private gaming salons, stunning restaurants and a stunning waterfall display all drive up the cost of doing business but allow the Bellagio to command a higher rate. Strategy: Control problems: 2. Describe contingent factors (as discussed in seminar 11) that are relevant in the determination of the MCS choices at the Bellagio 3. Discuss the potential control costs (both direct and indirect) of MCS. Evaluate whether the MCS is appropriate given these control costs Activity 16 For each of the statements from the seminar 8 in-class exercise, explain why they are not logical: * The last three times I have had a cold I took large doses of vitamin C. On each occasion, the cold cleared up within a few days. So vitamin C helped me recover from colds. Post hoc X may not be the cause of Y just because X is followed by Y. in this case, taking vitamin C may not cure cold just because the cold cleared up after taking vitamin C. This inference is not warranted since this might just...
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...Industry Leader Stephen Wynn Steve Wynn is an amazing casino mogul and is also one of the largest investor in Las Vegas his is the 512 richest person in the world today according to Forbes magazine. Stephen Wynn has been in the hospitality industry pretty much all his life because he was born into it. Wynn was born in New Haven Connecticut and his family owned bingo parlors through the eastern part of the United States. His last names was not originally Wynn it was actually Weinberg but his family changed it back in 1946 to avoid discrimination because they were Jewish; Stephen was six years old at the time. Wynn and his family moved to New York where he attended The Manlius School; which is a private all boys’ school then in 1959 he studied cultural anthropology and English literature at the University of Pennsylvania. When his father passed he left Wynn with $350,000 in gaming debt, so he took over the family’s bingo businesses. He became quite successful running the family business and this success allowed him to move into bigger business ventures. Wynn invested in the Frontier Hotel and Casino in Las Vegas in 1961 and moved there with his wife Elaine. Wynn also had another company while he invested in Las Vegas, which was that he owned and operated a wine and liquor importing company. He was making good money and had enough profit and connections in his life that in 1971 he managed to strike a deal with the likes of Howard Hughes and it involved him controlling the interest...
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...Controls at the Bellagio Casino Objectives of the company: To earn profits. Significant amount of income was generated through high-end gaming segment and its over all performance was highly dependent on the volume of customers at its resorts. A highly competitive environment with other gaming and leisure companies. Strategy: Company’s primary methods of successfully competing in these markets: Locating resorts in desirable leisure and business travel markets, and operating at superior sites within those markets. Luxurious and premium customer service. Recruiting and training the best staff. Developing distinctive and memorable marketable and promotional programs. Key performance indicators: Gaming revenue indicators such as table games drop and slot machines handle. Hotel revenue indicators through occupancy and average daily price rate. Increasing use of advanced technologies to help maximize revenue and operational efficiency. Example: By combining the player affinity programs, the players club, and manadalay’s one club into a single program. This enhanced the customer experience and revenue potential. The key strategy to maximize profits this case focuses on is the internal controls adopted by the casino. Internal controls: Extensive government regulation to ensure effective internal controls. Effective Internal Controls were really important in a business such as this where the government had its own share of the pie and the owners of the casino would...
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...'Twerk' is now in the dictionary, thanks to Miley Cyrus By Elisabeth Donnelly August 28, 2013, 7:56 a.m. Thanks to Miley Cyrus, the word "twerk" has been everywhere this week. And now it's going in the dictionary. Cyrus' gyrations during her performance at Sunday's MTV Video Music Awards caused a stir and put the word "twerk" on everyone's lips — and in the Oxford Dictionaries Online. Dictionary officials call them "buzzworthy words added to Oxford Dictionaries Online" — "twerk" joins "bitcoin," "selfie," and "girl crush." They'll all now found in the Oxford Dictionaries Online, which is tasked with staying up to date with modern words. The Oxford Dictionaries Online is one of the largest in the world and adds about 1,000 new entries to its online version every year. Oxford Dictionaries' spokeswoman Katherine Connor Martin told the Associated Press that "twerking" dates back 20 years, and "the most likely theory is that it is an alteration of work ... with dancers being encouraged to 'work it.' The 't' could be a result of blending with another word such as twist or twitch." Its sibling publication, the authoritative Oxford English Dictionary, won't be updated with these words anytime soon, unless "twerk, verb" proves to have staying power. Or as the Oxford Dictionaries Online's usage example puts it: "twerk it girl, work it girl." Taking her daughters to remote Australia to sleep on the ground Australia's Northern Territory is just the place to get...
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...inadequate existing controls and what improvements would you suggest? In-class activity 2: The role of management accounting information in controlling an organisation Source case / paper: Kaplan, R. S., 1984, The Evolution of Management Accounting, The Accounting Review, Vol. LIX, No. 3, pp. 390-418 (SO page 92 to 120). In-class activity questions / objectives: 1. What is the role of accounting information in controlling an organisation? 2. Outline the historical development of the use of management accounting information to control organisations. 3. Why may profit not be a good criterion to “motivate and evaluate short-term performance” in all cases? In-class activity 3: Controls at the Bellagio Casino Resort Source case / paper: Case Study: Controls at the Bellagio Casino Resort (textbook p. 134) In-class activity questions / objectives: Focus on the three key roles at three levels of authority in the casino – blackjack dealers, pit bosses, and the vice president of table games. 1. Prepare a list of the key controls described in the case for blackjack dealers, pit bosses, and the vice president of table games. What key control problems are they designed to address? 2. How would you characterize the “control strategy” (e.g., tight vs. loose) used over each of these roles (blackjack...
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...adequate for a discussion of basic concepts and tools used to assess customer attractiveness. For instance, what player characteristics in 2002 increase the likelihood that the player will come back in 2004? 2. How does the MGM Grand derive value from its Players Club program and its player information systems? 3. Do you think it is appropriate for hosts from any property to have access to the entire profile of a specific customer, regardless where that customer plays or stays? Why? If you think that hosts from a certain property should have access only to the information on customers’ play in their property, do you think there is anybody who should have a comprehensive view of the customer? 4. Do you think treating each property (MGM Grand, Bellagio, Treasure Island, etc.) as an independent profit center is...
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