Standardbred Owners of Massachusetts Inc.

This is a state performance audit of Standardbred Owners of Massachusetts, a nonprofit connected to Standardbred horse breeding and racing, covering 2013 and 2014.

“I am pleased to provide this performance audit of Standardbred Owners of Massachusetts Inc.”

The audit looked at whether the organization handled its money properly and followed the legal rules for revenue and spending.

“The objective of our audit was to determine whether SOM was properly administering its revenue and expenses in compliance with applicable statutory requirements.”

The money from Plainridge was the organization’s main funding source for the Standardbred Breeding Program, so underpayments could affect that program.

“This was SOM’s main source of revenue, which it used to operate the Standardbred Breeding Program in Massachusetts.”

For an ordinary resident, the key point is accountability: a group receiving legally required racing revenue should make sure it gets the right amount.

“Without detailed verification, SOM has no assurance that it received the correct percentage of revenue from Plainridge; it could be unknowingly losing revenue to which it is entitled by law.”

The auditor tested the audit period and found the money received was correct, but said SOM still lacked a process to make sure that would always be true.

“During our audit fieldwork, we performed testing and determined that SOM had received the correct amount of revenue during the audit period, but there is no assurance that this would be the case for any other given year.”

The auditor recommended that SOM get detailed wagering records from Plainridge and set up procedures to verify future payments.

“SOM should then establish and implement policies and procedures to use this documentation to verify that the amount of revenue it receives from Plainridge is in accordance with statutory requirements.”

This matters because state law required Plainridge to transfer set percentages of certain horse-racing wagers to SOM.

“According to law, a percentage of all live bets at the Plainridge Park Racecourse must be transferred to SOM.”

Pari-mutuel racing means bets are pooled together, and payouts come from that pool for winning bets.

“Pari-mutuel racing is a system in which all bets of a particular type are placed in a pool and payoff odds are calculated by sharing the pool among all winning bets.”