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Lakes Entertainment Extends Filing Date18 March 2005MINNEAPOLIS, Minnesota -- (PRESS RELEASE) -- Lakes Entertainment, Inc. (Nasdaq:LACO) today announced that it has notified the SEC that it will need to delay the filing of its annual report on Form 10-K for the year ended January 2, 2005. The notification provides an extension to file the Form 10-K no later than 15 calendar days after its original due date of March 18. If filed within that time frame, Lakes will have satisfied the SEC's requirement for a timely submission of the Form 10-K. The filing delay is in response to comments Lakes has received from the SEC staff on Lakes' Form 10-K for the year ended December 28, 2003, related to a review of Lakes' financial statements. The comments would affect the company's current Form 10-K filing. The delay enables Lakes to continue its discussions with the SEC staff about its comments before filing the Form 10-K. The SEC staff has questioned Lakes' accounting for development costs and advances related to Indian casinos. Lakes has responded to the SEC staff's comments; however, the comments have not yet been resolved. Lakes emphasized that the delay relates to SEC comments about the appropriateness of including development costs and advances as assets on its balance sheet, not a failure to disclose events or risks. The SEC's comments stem from a staff review of Lakes' financial filings, as required for every public company at least once every three years under the Sarbanes-Oxley Act of 2002. "The SEC comments do not affect Lakes' cash position, its business model or the potential of our various casino projects," said Lyle Berman, Chairman and Chief Executive Officer of Lakes Entertainment. "The discussion we're having with the SEC is related entirely to the financial statement treatment of certain transactions recognized under accounting principles for our industry." Lakes records costs and advances to Indian tribes for the development of casinos as assets on its balance sheet. Lakes believes that recording development costs and advances as assets, as consistently reflected in its audited financial statements, is in accordance with generally accepted accounting principles. Lakes believes its accounting is consistent with the treatment of such costs and advances by other publicly traded companies with similar Indian casino development agreements. Specifically, participants in the Indian gaming industry regularly fund development costs for new Indian casinos and make advances to Indian tribes. In Lakes' 15 years in the Indian gaming industry (including the experience of Lakes' predecessor, Grand Casinos, Inc.), Lakes and the other participants in the industry have generally followed similar accounting practices to those currently followed by Lakes. |