• FEDERAL ELECTION COMMISSION

W"\tiING TON. 0 C 20461

A8S-23

March 27, 1986

MEMORANDUM

TO:

FROM:

SUBJECT:

FRED EILAND

PRESS OFFICER

ROBERT J. COSTA ~ft' J

ASSISTANT STAFF DI~T~ AUDIT DIVISION

PUBLIC ISSUANCE OF FINAL AUDIT REPORT - NEBRASKA DEMOCRATIC STATE CENTRAL COMMITTEE

Attached please find a copy of the final audit report on

Nebraska Democratic State Central Committee which was approved by the Commission on March 18, 1986.

Informational copies of the report have been received by all parties involved and the report may be released to the

pUblic.

Attachment as stated

cc: FEC Library

RAD

- Press Office

Office of General Counsel

•
• FEDERAL ELECTION COMMISSION

WASHINGTON, 0 C 204&3

o

A85-23

REPORT OF THE AUDIT DIVISION

ON

NEBRASKA DEMOCRATIC STATE CENTRAL COMMITTEE

I. Background

A. Overview

This report is based on an audit of the Nebraska

Democratic State Central Committee ("the Committee"), undertaken

by the Audit Division of the Federal Election Commission in

accordance with the provisions of the Federal Election Campaign Act of 1971, as amended ("the Act"). The audit was conducted

pursuant to Section 438(b) of Title 2 of the United States Code

which states, in part, that the Commission may conduct audits and

field investigations of any political committee required to file

a report under section 434 of this title. Prior to conducting

any audit under this subsection, the Commission shall perform an

internal review of reports filed by selected committees to

determine if the reports filed by a particular committee meet the

threshold requirements for substantial compliance with the Act.

The Committee registered with the Clerk of the House of

Representatives on April 17, 1972 as the State Committee of the

Democratic Party of Nebraska and is a multicandidate committee as

defined in Section 44la(a) (4) of Title 2, United States Code.

The Committee maintains its headquarters in Lincoln, Nebraska.

The audit covered the period January 1, 1983 through December 31,

1984. The Committee reported an opening cash balance on January 1, 1983 of $745.551 total receipts of $440,928.331 total

disbursements of $440,551.951 and a closing cash balance on

December 31, 1984 of $1,133.23. 1/

This audit report is based on documents and work papers

which support each of its factual statements. They form part of

the record upon which the Commission based its decisions on the

matters in the report and were available to the Commissioners and

appropriate staff for review.

•

1/ The reported totals do not calculate correctly due to an

adjusting entry made by the Committee to the reported closing balance.
The Treasurer of the Committee during the period covered by the audit was Christopher Beutler. 1/

c. Scope

The Audit included such tests as verification of total

reported receipts and expenditures and individual transactionsl

review of required supporting documentation, analysis of

Committee debts and obligationsl and such other audit procedures

as deemed necessary under the circumstances.

II. Audit Findings and Recommendations

A. Disclosure of Earmarked Contributions

• B. Key Personnel

2

•

Section 110.6(b) of Title 11, Code of Federal

Regulations, states, in part, that earmarked means a designation,

instruction or encumbrance which results in all or any part of a

contribution or expenditure being made to, or expended on behalf

of, a clearly identified candidate or candidate's authorized

committee.

Section 110.6(c) of Title 11, Code of Federal

Regulations, states, in part, that the intermediary or conduit of

the earmarked contribution shall report the original source and

intended recipient of the contribution to the Commission.

Further, Section 110.6(c) (4) (ii) of Title 11, Code of

Federal Regulations, states, in part, that the reports shall

contain the amount, date, and the intended recipient as

designated by the contributor.

The Committee received 68 contributions earmarked to

candidates from unregistered local organizations, totaling $13,470.41.1/ The Audit staff noted that for 66 earmarked

contributions, totaling $12,470.41, the Committee failed to

disclose the intended recipients of the contributions on its

receipt Schedule A's. It should be noted that the Committee

properly disclosed the disbursement of these funds to the

intended recipients.

1/ According to Committee officials, Marsha Malone became

Treasurer as of August/September 1984.

1/ The Committee chose to deposit the earmarked contributions

and issue its own checks to the intended recipients•
•

•

,,..

•

•

3

The Committee responded to the recommendation contained

in the interim audit report on February 27, 1986 by filing amendments which properly disclosed the required information on

Schedule A.

Recommendation

Based on the above, the Audit staff recommends no further

action.

B. Disclosure of Transfers

Section 434(b) (3) (D) of Title 2, United States Code,

states, in part, that each report under this section shall

disclose the identification of each affiliated committee which

makes a transfer to the reporting committee during the reporting

period.

The Committee received 77 transfers totaling $16,537.67. The Audit staff identified 5 transfers received from

affiliated committees, totaling $8,366, which were not itemized

by the Committee. The dollar percentage of the errors is 50.86'•

On February 27, 1986, the Committee responded to the

recommendation contained in the interim audit report. The

Committee filed amended reports which properly disclosed the

above transfers.

Recommendation

The Audlt staff recommends no further action on this matter.

c. Matter Referred to the Office of General Counsel

A certain matter noted during the audit was referred to

the Commission's Office of General Counsel•