Part II

Overview of Committee

Committee Organization

Important Dates

Committee on Arrangements for the
2004 Republican National Convention

e Date of Registration

January 25, 2002

e Audit Coverage

May 28, 2002 — December 31 , 2004

Headquarters

Washington, DC

Bank Information

e__ Bank Depositories

One

e Bank Accounts

Two

Treasurers

¢ Treasurer When Audit Was Conducted

Michael L. Retzer

e Treasurer During Period Covered by Audit

Robert M. Duncun & Michael L. Retzer

Management Information

e Attended FEC Campaign Finance Seminar _| No

e Used Commonly Available Campaign Yes
Management Software Package

¢ Who Handled Accounting and Paid Staff

Recordkeeping Tasks

Overview of Financial Activity
(Audited Amounts)

Cash on hand @ May 28, 2002 $0
o_ Federal Funds 14,924,000
o__Loans Received 425,000
o_ Offsets to Convention Expenditures 40,909
Total Receipts $ 15,389,909
o Convention Expenditures 14,463,319
o Loan Repayments 425,000
Total Disbursements $ 14,888,319
Cash on hand @ December 31, 2004 $ 501,590


committee and capital assets listed at their fair market value;

Facts and Analysis
For the 2004 election, each major political party was entitled to receive $14,924,000 to
finance its national Presidential nominating convention. The 2004 Republican National

Convention ended on September 2, 2004. The COA fi
Convention Expenses as of October 17, 2004. The Au
through December 31, 2005 and estimated the windin

shown below.
Statement of Net Outstanding Campaign Expenses
As of October 17, 2004
As Prepared Through December 31, 2005
Assets
Cash in Bank $ 840,884
Accounts Receivable 33,139

(a)
(b]

Total Assets

Liabilities

Qualified Convention Expenditures $355,753
Actual Winding Down Expenses 296,405
Estimated Winding Down Expenses — 1/1/06 to 4/30/06 4,000
Stale-Dated Checks 6,667

Total Liabilities

Net Outstanding Convention Expenses - Surplus

Footnotes to NOCE Statement:

Adjusted for stale-dated checks totaling $6,667.

The total of all outstanding obligations for qualified campaign expenses; and
An estimate of necessary winding-down costs. 11 CFR §9008.10(g).

[a]

(b]

The total of all committee assets including cash on hand, amounts owed to the

led a Statement of Net Outstanding
dit staff reviewed financial activity
ig down cost in preparing the figures

$ 874,023

662,825

$ 211,198

Included is the cost of the Official Report of the Proceedings of the Thirty-Eighth Republican National
Convention. The contract for the book was dated February 14, 2005. The last day of the Republican
National Convention was September 2, 2004. Therefore, the cost of the book falls within 11 CFR

§9008.10(g)(1)(ii).


Part I
Background

Authority for Audit

This report is based on an audit of the Committee on Arrangements for the 2004
Republican National Convention (COA), undertaken by the Audit Division of the Federal
Election Commission (the Commission) as mandated by Section 9008(g) of Title 26 of
the United States Code. That section directs the Commission to conduct an examination
and audit of the payments for presidential nominating conventions no later than
December 31 of the calendar year in which the presidential nominating convention
involved is held.

Scope of Audit

This audit examined:

The disclosure of receipts and loans.

The disclosure of disbursements, debts and obligations.

The recordkeeping process and completeness of records.

The consistency between reported figures and bank records,

The accuracy of the Statement of Net Outstanding Convention Expenses.
The committee’s compliance with requirements concerning expenditures for
convention expenses.

7. Other committee operations necessary to the review.

AYWRYNE

Inventory of Committee Records
The Audit staff routinely conducts an inventory of committee records before it begins the
audit fieldwork. The COA records were materially complete and the fieldwork began

immediately.


Part III
Summaries

Findings and Recommendations

Finding 1. Net Outstanding Convention Expenses - Surplus
The COA received $14,924,000 to finance the Republican National Convention, The
Statement of Net Outstanding Convention Expenses (NOCE), as calculated by the Audit staff
at the time of the Preliminary Audit Report, showed an amount of unspent funds. The Audit
staff recommended that the COA provide documentation demonstrating that either no
repayment of unspent funds was due, or that a lesser amount was due.

In response, COA demonstrated that small adjustments to the amount of unspent funds were
required and stated that the COA is prepared to make a complete repayment of all unspent
funds following the approval of the audit report and termination of the committee.

The Audit staff recommends that the Commission make a determination that $211,198 is
repayable to the United States Treasury. (For more detail, see p. 4)

Finding 2. Stale-dated Checks

The Audit staff reviewed COA’s bank activity through December 31, 2005 and identified 4
stale-dated checks totaling $6,667. The Audit staff recommended that COA provide
evidence that the checks are not outstanding or make payment to the United States Treasury.
On January 25, 2006, COA repaid $6,667 to the United States Treasury. (For more detail,

see p. 6)

Summary of Amounts Owed to the U.S. Treasury

e Finding 1 Net Outstanding Convention $ 211,198
Expenses — Surplus

e Finding 2 | Stale-dated Checks 6,667
Total Owed $ 217,865
Less Payment Received 7/29/2005 100,000
Less Payment Received 1/25/2006 6,667
Net Amount Owed to the United $111,198
States Treasury



The NOCE as calculated by the Audit staff shows unspent funds of $211,198. On July 29,
2005, COA made an interim repayment of $100,000 to the United States Treasury.

Preliminary Audit Report Recommendation and Committee Response
The Audit staff recommended that COA provide documentation demonstrating that either:
(a) no repayment of unspent funds is due, or (b) a lesser amount is due.

In response, COA demonstrated that small adjustments to the amount of unspent funds were
required. In follow-up communications with COA representatives, they have agreed with the
staff calculation. The adjustments are included in the calculation of the amount of unspent
funds in the NOCE Statement presented above. The COA also stated that it is prepared to
make a complete repayment of all unspent funds following the approval of the audit report
and the termination of the Committee.

Recommendation
The Audit staff recommends that the Commission make a determination that $211,198 is
repayable to the United States Treasury.

| Finding 2. Stale-dated Checks

Summary
The Audit staff reviewed COA’s bank activity through December 31, 2005 and identified 4

stale-dated checks totaling $6,667. The Audit staff recommends that COA provide evidence
that the checks are not outstanding or make payment to the United States Treasury in the
amount of $6,667.

Legal Standard
Stale-dated Committee Checks. If the committee has checks outstanding that have not

been cashed, the committee shall notify the Commission. The committee shall inform the
Commission of its efforts to locate the Ppayees and encourage the payees to cash the
outstanding checks. The committee shall also submit a check for the total amount of such
outstanding checks, payable to the United States Treasury. 11 CFR §9008.16

Facts and Analysis

The Audit staff reviewed COA’s bank activity through December 31, 2005 and identified 4
stale-dated checks, totaling $6,667. At the exit conference, COA representatives were
presented a list of the stale-dated checks. They agreed to review their records and provide

the Audit staff with any additional information discovered.

Preliminary Audit Report Recommendation and Committee Response
The Audit staff recommended that, the COA provide evidence that the checks are not
outstanding; that they have been voided and no obligations exists; or make a payment of

$6,667 to the United States Treasury.

In response to the preliminary audit report, COA made a payment of $6,667 to the United
States Treasury.


FEDERAL ELECTION COMMISSION
WASHINGTON, D.C. 20463

May 9, 2006

MEMORANDUM

TO: ROBERT W. BIERSACK
PRESS OFFICER
PRESS OFFICE

FROM: JOSEPH F. STOLTZ gy Ts
1 Pf

ASSISTANT STAFF DIRECTOR
AUDIT DIVISION

SUBJECT: PUBLIC ISSUANCE OF THE AUDIT REPORT ON
THE COMMITTEE ON ARRANGEMENTS FOR THE 2004
REPUBLICAN NATIONAL CONVENTION

Attached please find a copy of the audit report on the Committee on Arrangements
for the 2004 Republican National Convention which was approved by the Commission on
April 14, 2006.

All parties involved have received informational copies of the report and the report
may be released to the public.

Attachment as stated

ce: Office of General Counsel
Office of Public Disclosure
Reports Analysis Division
FEC Library
Web Manager JS


Part IV
Findings and Recommendations

| Finding 1. Net Outstanding Convention Expenses — Surplus |

Summary

The COA received $14,924,000 to finance the Republican National Convention. The
Statement of Net Outstanding Convention Expenses (NOCE), as calculated by the Audit staff
at the time of the Preliminary Audit Report, showed an amount of unspent funds. The Audit
staff recommended that the COA provide documentation demonstrating that either no
repayment of unspent funds was due, or that a lesser amount was due.

In response, COA demonstrated that small adjustments to the amount of unspent funds were
required and stated that the COA is prepared to make a complete repayment of all unspent
funds following the approval of the audit report and termination of the committee.

The Audit staff recommends that the Commission make a determination that $21 1,198 is
repayable to the United States Treasury

Legal Standard
Entitlement to Payments From the Fund. The national committee of a major party shall

be entitled to payments with respect to any presidential nominating convention, in amounts
that, in the aggregate shall not exceed $4,000,000, as adjusted by the Consumer Price Index.
The major party entitlement for the 2004 nominating convention was $ 14,924,000. 26

U.S.C. §9008(b)(1) & (5).

Repayments Any portion of the entitlement that remains unspent after all convention
expenses have been paid, shall be returned to the Secretary of the Treasury. The national
committee or convention committee shall make an interim repayment of unspent funds based
on the financial position of the committee as of the end of the ninth month following the last
day of the convention, allowing for a reasonable amount as determined by the Commission to
be withheld for unanticipated contingencies. The interim repayment shall be made no later
than 30 calendar days after the end of the ninth month following the last day of the

convention. 11 CFR §9008.12(b)(5).

Repayment Determination Procedures The Commission will follow the same repayment
determination procedures, and the committee has the same rights and obligations as are
provided for repayment determinations involving publicly funded candidates under 11 CFR

9007.2(c) through (h). 11 CFR §9008.12(c).

Net Outstanding Campaign Expenses (NOCE). A convention committee shall file, no
later than sixty days after the last day of the convention, a statement of that committee’s “net
outstanding convention expenses.” This statement must contain, among other things:


Report of the Audit Division on
the Committee on Arrangements
for the 2004 Republican National

Convention
May 28, 2002 - December 31, 2004

Why the Audit

Was Done

Federal law requires the
Commission to audit the
national committee of a
party who receives
payments for presidential
nominating conventions.!
The audit examines the
receipt and use of Federal
funds and whether the
committee otherwise
complied with the
limitations, prohibitions
and disclosure
requirements of the
election law.

Future Action
The Commission may
initiate an enforcement
action, at a later time,
with respect to any of the
matters discussed in this
report.

About the Committee (p. 2)

The Committee on Arrangements for the 2004 Republican National
Convention (COA) was responsible for the day to day arrangements
and operations of the Republican Presidential nominating convention
The COA is headquartered in Washington, DC. For more
information, see chart on the Committee Organization, p. 2.

Financial Activity (p. 2)
¢ Receipts

o. Federal Funds $14,924,000
o Loans Received 425,000
o Offsets to Convention Expenditures 40,909
o Total Receipts $15,389,909
¢ Disbursements
o Convention Expenditures $14,463,319
o Loan Repayments 425,000
o Total Disbursements $14,888,319

Findings and Recommendations (p. 3)
¢ Net Outstanding Convention Expenses - Surplus (Fi inding 1)
¢ Stale-dated Checks (Finding 2)

"26 U.S.C. §9008(g)


Table of Contents

Part I. Background
Authority for Audit
Scope of Audit
Inventory of Committee Records

Part II. Overview of Committee
Committee Organization
Overview of Financial Activity

Part III. Summaries
Findings and Recommendations
Summary of Amounts Owed to the U.S. Treasury

Part IV. Findings and Recommendations
Finding 1. Net Outstanding Campaign Expenses - Surplus
Finding 2. Stale-dated Checks

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