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Attachment as stated

March 29, 1982

A8l-S6

FRED EILAND

PRESS OFFICE~

BOB COSTA

PUBLIC ISSUANCE OF FINAL AUDIT REPORT - FRIENDS OF ASSEMBLYMAN RICHARD ROBINSON

COMMITTEE

WASHINCTON. 0 C 20463

FEDERAL ElECTION COMMISSION

cc: FEC Library

RAD

\./l'ublic Record

FROM:

SUBJECT:

TO:

MEMORANDUM

.....

Attached ,please find a copy of the final audit report of the

Friends of Assemblyman Richard Robinson Committee which was

'J approved by the Commission on March 11, 1982 •

• Informational copies of the report have been received by all

parties involved and the report may be released to the public •
'"..

..

. -, ...

FEDERAL ELECTION COMMISSION

WASHINGTON. 0 C 204&3

A8l-56

REPORT OF THE AUDIT DIVISION

ON THE

FRIENDS OF ASSEMBLYMAN RICHARD ROBINSON COMMITTEE

I • Background

A. Overview

This report is based on an audit of the Friends of

Assemblyman Richard Robinson Committee «"the Committee"),

undertaken by the Audit Division of the Federal Election

Commission in accordance with the Commission's audit policy to

determine whether there has been compliance 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 section,

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 Federal Election

Commission on May 31, 1978. The Committee maintains its

headquarters in Santa Ana, California.

The audit covered the period January 1, 1980 through

December 31, 1980. The Committee reported a cash balance on

January 1, 1980 of $4,306.58, total receipts for the period of

$20,748.991 total expenditures for the period of $25,000.00, and

a cash balance on December 31, 1980 of $55.57.

This report is based upon documentation and workpapers which support each of the 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.
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B. Key Personnel

The Treasurer for the Committee during the period covered by the audit was Mr. Richard W. Milner.

C. Scope

The audit included such tests as verification of total

reported receipts and expenditures and individual transactionsJ

review of required supporting documentation, and analysis of

Committee debts and obligations, and such other audit procedures

as deemed necessary under the circumstances.

II. Audit Finding and Recommendation

A. Allocation of Fundraising Expenses

Section 102.5(a) (1) of Title 11, Code of Federal

Regulations states, in part, that each organization which . finances political activity in connection with both federal and

non-federal elections shall either: (i) Establish a separate federal account in a depository which shall be treated as a

separate federal political committee and shall comply with the

requirements of the Act, or (ii) Establish a political committee

which shall receive only contributions subject to the

prohibitions and ,limitations of the Act, regardless of whether

such contributions are for use in connection with fed~ra1 or nonfederal elections. ,.

Section 106.1(e) of Title 11, Code of Federal

Regulations, states that party committees and other political committees which have established federal campaign committees

pursuant to 11 C.F.R. 102.5 shall allocate administrative expenses

on a reasonable basis between their federal and non-federal

accounts in proportion to the amount of funds expended on federal

and non-federal elections, or on another reasonable basis.

The Committee is a separate account established by Assemblyman Richard Robinson to engage in federal activity. Assemblyman Robinson also has established another entity, of the

same name, which engages in non-federal activity. During the

audit period fundraising expenses paid on behalf of both entities

by the non-federal account were ,not allocated between the federal

and non-federal accounts as required by 11 C.F.R. l06.l(e).

Committee officials advised that they would determine,

on a reasonable basis, an amount of fundraising expenses allocable to the federal account.
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In the interim audit report, the Audit staff

recommended that the Committee, within 30 days of receipt of the

report, determine on a reasonable basis the amount of fundraising

expense allocable to the federal account and provide sufficient·

documentation to evaluate the reasonableness of the allocation

method. It was also recommended that the Committee reimburse the

non-federal account for the appropriate amount "and provide to the

Audit staff evidence of the reimbursement.

On March 1, 1982, the Audit staff received the

Committee's response to the interim report indicating that

fundraising costs totaling $1,306.73 were allocable to the

federal account and that reimbursement had been made. The Audit

staff's review of the supporting documentation has revealed that

the allocation method and reimbursement appear to be reasonable.

Recommendation

The Audit staff recommends no further action with respect to

the requested reimbursement. However, it is recommended that the

Committee, in the future, perform such allocations as necessary

on a timely basis.