AnnuAl rEPort - Vermont Lottery

VERMONT LOTTERY COMMISSIONANNUAL REPORTFISCAL YEAR 2005 2008NOTES TO FINANCIAL STATEMENTSJune 30, 2008 and 20074. Investments/due to winners:Investments at June 30, 2008 and 2007 were as follows:2008 2007Money Market Funds $ 100,000 $ 100,000U.S. Treasury Strips 1,701,730 1,959,541Annuity contracts 544,119 603,527$ 2,345,849 $ 2,663,068Interest rate risk - The Lottery purchases investments in government securities that will mature in future years topay multi-year payment prizes won by certain instant ticket winners (see Note 9). These are held by the TrustDepartment of the Chittenden Bank in Burlington, Vermont, and are reported at market value. The Lottery also ownstwo annuity contracts purchased for winners which are reported at amortized cost. Because these investments arescheduled to be paid to winners as they mature, the Lottery has an investment policy that limits investment maturitiesas a means of managing its exposure to fair value losses arising from increasing interest rates.Credit, and custodial credit risk - Investments in the two annuity contracts are both with Keyport Life InsuranceCompany (see Note 1.J.). These contracts are unrated.Investments and Due to winners as of June 30, 2008 are $2,345,849 and $2,174,040, respectively. Investments and Dueto winners as of June 30, 2007 are $2,663,068 and $2,562,796, respectively.5. Accounts receivable:Accounts receivable at June 30 consisted of the following:2008 2007MUSL $ 615,192 $ 543,414Tri-State 56,285 65,374Instant Agents 595,227 485,294Instant Chains 75,294 65,849Online Agents 295,699 289,684Online Chains 43,434 45,285Total 1,681,131 1,494,900Less: Allowance for doubtful accounts (51,573) (2,044)Net accounts receivable $ 1,629,558 $ 1,492,85621