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CONGRESSIONAL AUDIT REPORT

Candidate/Committee:

State:

District:

Location:

Alabama

• 5th

Huntsville

Political Party Affiliation: Democratic

Other Candidates ~udi:ad: Ronnie Flippo l l Robert Potts·.,~O 71

Jyles Machen-.tIJ"'1 •

Major Opponent(s): Ronnie Flippo

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Votes Cast: General E1ection - N/A

PrimarJ Election - Ronnie Flippo 25,343 - 24.3%

Robert Potts 14,553 - 13.9%

Total Receipts fer Period:

$110,746.08

Total Expenditures f~r Period: $110,746.08

First Elec-:ad (if applicable):· N/A

John Eyster 22,456 - 21.5~

Gene McLain 11,679 - 11/2~

Jyles Machen 17,059 - 16.3~

Lynn Greer 5,283 - 5.1~
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REPORT OF THE AUDIT DIVISION

ON THE

MCLAIN CAMPAIGN COMMITTEE

The Committee registered with the Federal Election

Commission on March l, 1976, in support of Gene rtcLain, a

candidate for election to the office of United States Reprcscnt~tive from the 5th Congressional District of Alabama. The

Conmli t tee maintained its headquarters in Huntsville, Alabama.

This report is based upon an audit of the McLain

Campaign Committee (lithe 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 (lithe Act"). 'l'he

audi-t- was- conducted pursuanttQ_S~~~ion 438 (a) (8) of Title 2,

United States Code, which directs the-'colurnl's'sl.on -to nlake ftom

time to time audits and field investigations with respect

to reports and statements filed under the provisions of the

Act •

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I . Background

A. Overview

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The audit covered the period February 9, 1976, the

inception date of the Committee, through June 16, 1976, the

final coverage date of the last report filed by the Committee

at the time of the audit. The Committee reported a beginning

cash balance at February 9, 1976 of $-0-, total receipts for

the period of $110,746.08, total expenditures for the period

of $110,746.08 and a closing cash balance at June 16, 1976 of

$-0-. !./

This audit report is based on documents and working

papers supporting each of its factual statements. They form

part of the record upon which the Commission based its decisions

on the matters in this report and were available to Commissioners

and appropriate staff for review.

1/ On June 17, 1976, the Candidate assu~ed the reporting

responsibilities for the Campaign's outstanding debts

anu obligations. He reported for the period June 17, 1976

" ' 'e, through r-1arch 31, 1978 receipts and expenditures totaling

'~:·O ··fG7 ,055. 86 • .~ ~:. • '. • J".
B. Key Personnel

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'llhe pr incipal officers of the Committee were

l\tr. ScoLL McLain, Chairman, and Mrs. Jerri Mcl.ain, 'rreasurer

tlurinq lh(' period of audit.

c. ~;cope

'('he audit included such tests as verifical ion of total

rcported receipts and expenditures and individual transactions:

review of rcquirctl supporting documentation: analysis of Committee debls and obligations; and, such other audit procedures

as deemed necessary under the circumstances.

II. Audilol"' s Statement

It is the opinion of the Audit staff, based upon examination

of the repo14ts and statements filed and the records presented,

that except for the deficiencies noted below, the reports and

sEatements of the McLain Campaign Commit-tee fairly -prc_s_ent tb_~

financial activitics of the COlumittee for the period covered by

the audit. Purther, except as noted below, no material problems

in complying with the Federal Election Campaign Act were discovered during the course of the audit.

1\. Supportinq Documentation for E:-:.pcncli tures

Section 432(d) of Title 2, Unilcd states Code, requires

the tl-casurcr to obtain and keep a receipted bill, statinq the

particulars, for every expenditure made by or on behalf of a

political committee in excess of $100, and for any such expenditures in a lesser amount if the aqqrcgate amount of such expenditures to the same person durinq tIll\ calendar year exceec.ls $100.

P'::lrt 102.9 (c) (4) of thc\ Commission's Regulations

states that when a receipted bill is not available, the treasurer

may keep: (i) the cancelled check: and (ii) the bill, invoice or

other conLemporaneous memorandum lo support the expenditure.

Our examination of the Com:nittec's expenditure records

rc':c~led th;ll. of 138 expenditures requiring supporting documentation, 6..J l"':-:IJcnJitures or 46.38 J lacked adequate supporting

documentation. These 6~ expenditures totaled $31,556.87, and

represented 29.35~ of the amount of total expenditures requiring

such documentation. At our request, the Committee agreed to obtain

the missinc; documentation. rrhe Committee obtained and submitted

to the Audit staff supportinq documentation for 55 or 85.94% of

the 64 expenditures lackinq supporting documentation. These 55

expenditures totaled $27,207.06 or 86.22~ of the value of the

expenditures.
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RccomMPnrlil tion

Bilserl on the above docnrnen t·.a tion suh'r"i tted by the ('omrn.i ttec,

and the Cornmi ttees efforts to ohl ain the adrli tiona1 doc\1mcnta tion

the Au<1i t staff recommends that: nn i:urther action be taken on

this rna l ter.

Other r1a t ters

"!'he fol1owinq matters wcrp noted durin~ the audit for which

no further action" is recoml'lcncl<,·d.

1) As previously noted, the last report filed hy the

('oJlUlli ttee at the ti1"le of our aucli t disclosed activi tv throuoh

June 16, 1976. The Committee han not reporterl any financial

activity from June 17, 1976 to da tee HO~lever, on ,;une 17, 1976,

the campClign had debts and ob1iqations outstanding in the aMount

of $-6-3,-'2'66 .3-lwliich arose- in connection with, the else tion.

Shortly thereafter, the Candidate aSSUMed the responsibilities

for these debts and obliqations. At our request, on ~pri1 In,

1978, the Committee and Candidate filed the requireo reports

for the period June 17, 1976 throuqh March 31, 1978.

2) Our examination of a portion of ~he Committee's

literature revealed that the Committee had not included the

stateMPnt required to be inc1urled on solicitation material hy

f~ection 435(h) (1) of Title 2, t1nited States Code. fTpon our

discussion with the COJYlTllittee conccrnin~ this Ma.tter-, the

Comrni ttce stated they were not av'are of the requirement. Pn\vcvC'r,

they aqrced to include the stat(~ment on any future solici tation

Iiterature.

3) Our review disclosed that the Candidate had not filed

a Stat0J1lent of Candidacy. llpon our request on DeceJllber 5, 1977,

the Candidate filed his ~tateM0nt of Candidacy •
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FEDERAL ELECTION COMMISSION

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ADDITIONAL INroRMATION REGARDING 'lHIS ORGANIZATION

MAY BE IOCA.TED m A CDMPlElED CD1PLIANCE ACIION

FILE RELEASED BY '!HE aM1ISSION AND MADE PUBLIC m

!HE PUBLIC REOJRDS OFFICE. FOR 'lHIS PARl'ICULAR

ORGANIZATION'S COMPLETED CD1PLIANCE ACrION FILE

SlMPLY JSK FOR 1HE PRESS sm+1ARY OF MIJR 41 l J.--

1HE PRESS st.Jr+fARY WIIL PROVIDE A BRIEF HISroRY OF

'!HE CASE AND A St»1ARY OF 'mE ACrIONS TAKEN, IF AN'{•