11

Legal Standard

A. Retention of Check Copies. For contributions in excess of $50, committees must
maintain a photocopy or digital image of the check or written instrument. 11 CFR
§102.9(a)(4)

B. Preserving Documents. Committees must preserve these records for 3 years after a
report is filed. 2 U.S.C. §432(d)

Facts and Analysis

A sample review of contributions from individuals in excess of $50 indicated that 38% of
the sample items could not be associated with available copies of contribution checks or
other written instruments. However, CRC’s checks copies were not organized by deposit
or in another discernable order. Further, many copies of checks received from business
entities were not attached to a solicitation response device or otherwise annotated with
the contributor’s name. As a result some of the check copies could not be associated with
a specific contributor. These unassociated checks could explain some of the records that
could not be located.* All of the check copies were reviewed for prohibited contributions
(See Finding 1. above)

The Audit staff discussed this matter with CRC at the exit conference. CRC
representatives offered to send the boxes of contributor checks to the Audit staff;
however, the records contained in the boxes had been reviewed in the field.

Interim Audit Report Recommendation and Committee Response
The Audit staff recommended CRC provide the missing records or any comments it may
have relative to this matter. In response to the interim audit report, CRC stated that all
contributor checks were copied and maintained. CRC stated two boxes of these copies
were made available for inspection at the audit site and at the campaign headquarters.
Therefore, CRC is at a loss as to why the auditors could not match contributions to copies

of checks.

As previously stated, many copies of checks received from business entities that were not
attached to a solicitation response or otherwise annotated, could not be associated with a
specific contributor. This likely explains why some sample items appear to lack the
required documentation. The Audit staff accepts CRC’s position that its records were

materially complete.

Finding 4. Failure to Disclose Occupation and Name of
| Employer

Summary
Contributions from individuals were reviewed on a sample basis. For itemized
contributions, the review indicated that CRC failed to disclose the occupation and/or the

4 Fieldwork (in the New Orleans area) was interrupted by Hurricane Katrina and completed in Washington,
Dc.


Part II
Overview of Campaign

Campaign Organization

Important Dates

Craig Romero for Congress, Inc.

¢ Date of Registration

April 8, 2004

e Audit Coverage

March 22, 2004 — December 31, 2004

Headquarters

Baton Rouge, LA

Bank Information

¢ Bank Depositories

_¢ Bank Accounts 3
Treasurer
¢ Treasurer When Audit Was Conducted Jeff Landry

e Treasurer During Period Covered by Audit

William C. Potter

Management Information

e Attended FEC Campaign Finance Seminar

No

« Used Commonly Available Campaign
Management Software Package

Yes

¢ Who Handled Accounting and
Recordkeeping Tasks

Paid Consultants

Overview of Financial Activity

(Audited Amounts)
Cash on hand @ March 22, 2004 $0
o Individuals 946,854
o Other Political Committees 15,743
o Loan from Candidate 70,000
o Other Receipts 2,350
Total Receipts $ 1,034,947
o Operating Expenditures 912,224
o Refund of Contributions 69,606
o Loan Repayments 45,000
Total Disbursements 1,026,830
Cash on hand @ December 31, 2004 $ 8,117



| Finding 2. Receipt of Excessive Contributions

Summary

A review of contributions from individuals revealed that CRC received $116,208 in
potential excessive contributions. Of this amount $46,989 was refunded, however the
refunds were not timely. The Audit staff recommended CRC demonstrate that the
remaining contributions ($69,219) were not excessive. Absent such evidence, the Audit
staff recommended CRC send notices to the contributors informing them of the
presumptive redesignation/reattribution of their contributions and offer a refund of the
excessive portion. If any contributors could not be located, or if any refund check was
not negotiated by the contributors, it was recommended that the sum of those excessive
contributions be paid to the United States Treasury. In response, CRC described the
procedures implemented to ensure compliance with contribution limitations, but took
none of the recommended actions.

Legal Standard

A. Authorized Committee Limits: An authorized committee may not receive more
than a total of $2,000 per election from any one person. 2 U.S.C. §441a(a)(1)(A) and 11
CEFR §110.1(a) and (b).

B. Handling Contributions That Appear Excessive. If a committee receives a
contribution that appears to be excessive, the committee must either:
e Return the questionable contribution to the donor; or
¢ Deposit the contribution and keep enough money on hand to cover all potential
refunds until the legality of the contribution is established. 11 CFR §103.3(b)(3)
and (4).

The excessive portion may also be redesignated to another election or reattributed to
another contributor as explained below.

C. Redesignation of Excessive Contributions. The committee may ask the contributor
to redesignate the excess portion of the contribution for use in another election.
¢ The committee must, within 60 days of receipt of the contribution, obtain and
retain a signed redesignation letter which informs the contributor that a refund of
the excessive portion may be requested; or
e Refund the excessive amount. 11 CFR §§110.1(b)(5), 110.1(1)(2) and
103.3(b)(3).

Notwithstanding the above, when an authorized political committee receives an excessive
contribution from an individual or a non-multi-candidate committee, the committee may
presumptively redesignate the excessive portion to the general election if the
contribution:

e Is made before that candidate’s primary election;

e Is not designated in writing for a particular election;

¢ Would be excessive if treated as a primary election contribution; and


Finding 5. Failure to Disclose Disbursement Information
A sample review of operating expenditures revealed that CRC failed to disclose the
vendor address for 41% of the items tested. A majority of the missing addresses were
contained on vendor invoices found in CRC’s files. In response, CRC filed amended
reports. (For more detail, see p. 13)


Part III

Summaries
Findings and Recommendations

Finding 1. Receipt of Prohibited Contributions

CRC received contributions from limited liability companies (LLCs) and apparent
corporate entities totaling $63,195. CRC refunded $30,903 of the contributions, leaving
$32,292 in unresolved apparent prohibited contributions. The Audit staff recommended
that CRC provide documentation demonstrating the contributions were not from
prohibited sources or refund $32,292 and provide copies of all negotiated refund checks.
In response, CRC demonstrated that $22,900 was from permissible sources and $9,292
was refunded; leaving only $100 unresolved. (For more detail, see p. 5)

Finding 2. Receipt of Excessive Contributions

A review of contributions from individuals revealed that CRC received $116,208 in
potential excessive contributions. Of this amount $46,989 was refunded, however the
refunds were not timely. The Audit staff recommended CRC demonstrate that the
remaining contributions ($69,219) were not excessive. Absent such evidence, the Audit
staff recommended CRC send notices to the contributors informing them of the
presumptive redesignation/reattribution of their contributions and offer a refund of the
excessive portion. If any contributors could not be located, or if any refund check was
not negotiated by the contributors, it was recommended that the sum of those excessive
contributions be paid to the United States Treasury. In response, CRC described the
procedures implemented to ensure compliance with contribution limitations, but took
none of the recommended actions. (For more detail, see p. 7)

Finding 3. Failure to Maintain Receipt Documentation

A sample review of contributions from individuals in excess of $50 indicated that 38%
either could not be associated with copies of contribution checks or lacked the necessary
records. The Audit staff recommended CRC provide the missing records or any
comments it may have relative to this matter. In response, CRC stated that the campaign
copied and maintained 100% of contributor checks and could not understand why the
auditors could not match contributions to copies of checks. (For more detail, see p. 10)

Finding 4. Failure to Disclose Occupation and Name of
Employer

Contributions from individuals were reviewed on a sample basis. For itemized
contributions, the review indicated that CRC failed to disclose the occupation and/or the
name of the employer for 30% of the contributions. There was no documentation to
indicate CRC used best efforts to obtain, maintain and submit the missing contributor
information. The Audit staff recommended CRC demonstrate that best efforts were made
or contact each contributor for whom the required information is missing and amend its
reports to disclose any information obtained. In response, CRC filed amended reports
disclosing the necessary contributor information. (For more detail, see p. 11)


A partnership contribution may not exceed $2,000 per candidate, per election, and
it must be attributed to each lawful partner. 11 CFR §110.1(a), (b), (e) and (g)(2).

2. LLC as Corporation. The contribution is considered a corporate contribution—
and is barred under the Act—if the LLC chooses to be treated as a corporation
under IRS rules, or if its shares are traded publicly. 11 CFR §110.1(g)(3).

3. LLC with Single Member. The contribution is considered a contribution from a
single individual if the LLC is a single-member LLC that has not chosen to be
treated as a corporation under IRS rules. 11 CFR §110.1(g)(4).

Facts and Analysis

The Audit staff determined that CRC received $63,195 in apparent prohibited
contributions. The contributions were received from limited liability companies and
corporate entities. CRC refunded $20,403 of the prohibited contributions, although the
refunds were not made timely.

Limited Liability Companies are permitted to contribute to political committees;
however, it is the responsibility of the LLC to affirm eligibility. No documentation
regarding the permissibility of the contributions from the LLCs was made available for
review. With respect to the contributions received from the apparent corporate entities,
the Audit staff verified the corporate status with the Louisiana Office of the Secretary of
State. The prohibited contributions were not deposited into a separate bank account but
CRC maintained sufficient funds to make the necessary refunds.

At the exit conference, the Audit staff presented CRC with a schedule of the apparent
prohibited contributions. In response to their questions, the Audit staff advised CRC of
the documentation required from the LLCs. Subsequent to the exit conference, CRC
refunded an additional $10,500 and provided copies of refunds checks (front only).

Interim Audit Report Recommendation and Committee Response
The Audit staff recommended that CRC demonstrate that the remaining prohibited
contributions, totaling $32,292 ($63,195 — $20,403 — $10,500), were not from prohibited
sources. Absent such demonstration, CRC was to refund $32,292 and provide copies of
the negotiated refund checks. Additionally, it was recommended that CRC provide
copies of the negotiated checks, totaling $10,500, supporting the refunds made
subsequent to the exit conference. If funds were not available to make the necessary
refunds, CRC was advised to disclose the contributions requiring refund on Schedule D
(Debts and Obligations) until funds become available to make such refunds.

In response to the interim audit report, CRC contacted contributors by fax, letter or
telephone to determine if the contributions were from permissible sources. CRC made
available copies of signed statements from representatives of the LLC’s regarding source
of funds. As a result of its efforts, CRC demonstrated that contributions totaling $22,900
was from permissible sources; $9,292 was from impermissible sources; leaving only
$100 unresolved. CRC provided copies of bank statements and negotiated refund checks
supporting refunds totaling $19,792 ($9,292 + $10,500).


FEDERAL ELECTION COMMISSION
WASHINGTON, D.C. 20463

October 18, 2007

MEMORANDUM

TO: ROBERT W. BIERSACK
PRESS OFFICER
PRESS OFFICE

FROM: JOSEPH F. STOLTZ “fee Is

ASSISTANT STAFF DIRECTOR
AUDIT DIVISION

SUBJECT: PUBLIC ISSUANCE OF THE REPORT OF THE AUDIT DIVISION ON
CRAIG ROMERO FOR CONGRESS, INC.

Attached please find a copy of the audit report on Craig Romero for Congress, Inc.
which was approved by the Commission on October 3, 2007.

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

Attachment as stated

cc: Office of General Counsel
Office of Public Disclosure
Reports Analysis Division
FEC Library
Web Manager 4


Facts and Analysis

The Audit staff determined that CRC received $116,208 in potentially excessive
contributions. All excessive contributions were received before the primary election.
CRC designated the excessive portions to the general election and subsequent run-off
election based on its opinion concerning the contributors’ intent. It should be noted that
the Candidate was not in the run-off election.

Included with each solicitation was a “fact sheet,” that informed the contributor that the
contribution limitation was $2,000 per individual per election and provided the dates of
the primary, general and run-off elections. The fact sheet also contained the following
statement: “This will allow an individual donor to make a contribution of $6,000 before
August 6, 2004,” designating $2,000 to each of the three election cycles.” The fact sheet
provided space for the required contributor information but it neither requested nor
provided space for the contributor’s signature. It is CRC’s opinion that the fact sheet was
an implicit designation by the contributor.

The Audit staff analyzed 37 fact sheets made available for the excessive contributors.
The contributor’s name on 12 of the fact sheets is completed in a cursive writing and
printed on the remaining 25 fact sheets. When comparing the cursive writing of the
contributor’s name to the contributor’s contribution check, it is apparent that the
contributor did not complete the name section on the fact sheet. Further, based on the
writing on the fact sheets it appears that the 37 fact sheets may have been completed by a
limited number of individuals. If it is determined that the information contained on the
fact sheet was not completed by the contributor, the contributions are not considered
designated to the general and/or run-off elections; but rather excessive primary election
contributions.

As previously stated CRC refunded $46,989.° If the excessive portion of the refunded
contributions were properly designated to the run-off election by the contributors, CRC
had 60 days from the date of the general election to make the refunds. Given that the
refunds were made shortly after the general election they would be timely. However, if
the refunded contributions were not properly designated to the run-off election by the
contributor, the refunds were required to be made within 60 days of receipt of the
contribution and therefore, would not be timely.

The excessive contributions were not deposited into a separate bank account but CRC
maintained sufficient funds to make the necessary refunds. This matter was discussed at
the exit conference. CRC was provided a schedule of the excessive contributions. CRC
maintains that the contributor’s intent was apparent.

? August 6" was the last day to qualify for the general election ballot in the state of Louisiana. The
regulation considers this date to be the primary election date. (11 CFR §100.2(c)(4)(i))

> The refunds represented contributions received before the primary election and designated by CRC for
the run-off election. The candidate did not participate in the run-off election.


e As redesignated, does not cause the contributor to exceed any other contribution
limit.

Also, the committee may presumptively redesignated the excessive portion of a general
election contribution back to the primary election if the amount redesignated does not
exceed the committee’s primary net debt position.

The committee is required to notify the contributor in writing of the redesignation within
60 days of the treasurer’s receipt of the contribution and must offer the contributor the
option to receive a refund instead. For this action to be valid, the committee must retain
copies of the notices sent. 11 CFR §110.1(b)(5)(ii)(B) & (C) and (1)(4)(ii).

D. Reattribution of Excessive Contributions. When an authorized committee receives
an excessive contribution, the committee may ask the contributor if the contribution was
intended to be a joint contribution from more than one person.
¢ The committee must, within 60 days of receipt of the contribution, obtain and
retain a reattribution letter signed by all contributors; or
e Refund the excessive contribution. 11 CFR §§110.1(k)(3), 110.1(1)(3) and
103.3(b)(3).

Notwithstanding the above, any excessive contribution that was made on a written
instrument that is imprinted with the names of more than one individual may be attributed
among the individuals listed unless instructed otherwise by the contributor(s). The
committee must inform each contributor:
e Of how the contribution was attributed; and
e That the contributor may instead request a refund of the excessive amount. 11
CFR §110.1(k)(3)Gi)).

For this action to be valid, the committee must retain copies of the notices sent. 11 CFR

§110.1(1)(4)Gi).

E. Contributions to candidates; designations and redesignations. A contribution
shall be considered to be designated in writing for a particular election if:

«The contribution is made by check, money order or other negotiable instrument
which clearly indicates the particular election with respect to which the
contribution is made;

¢ The contribution is accompanied by writing, signed by the contributor, which
clearly indicated the particular election with respect to which the contribution was
made. 11 CFR §110.1(b)(4)(i) and (ii).

F. Advisory Opinion 1990-30. In the advisory opinion, the Commission stated that,
"the contributor would be able to effectuate a designation by returning a preprinted form
supplied by the soliciting committee that clearly states the election to which the
contribution will be applied, provided that the contributor signs the form and sends it to
the committee together with the contribution."


Part IV
Findings and Recommendations

| Finding 1. Receipt of Prohibited Contributions

Summary

CRC received contributions from limited liability companies (LLCs) and apparent
corporate entities totaling $63,195. CRC refunded $30,903 of the contributions, leaving
$32,292 in unresolved apparent prohibited contributions. The Audit staff recommended
that CRC provide documentation demonstrating the contributions were not from
prohibited sources or refund $32,292 and provide copies of all negotiated refund checks.
In response, CRC demonstrated that $22,900 was from permissible sources and $9,292
was refunded; leaving only $100 unresolved.

Legal Standard
A. Receipt of Prohibited Contributions - General Prohibition. Candidates and
committees may not accept contributions (in the form of money, in-kind contributions or
loans):
1. Inthe name of another; or
2. From the treasury funds of the following prohibited sources:
© Corporations (this means any incorporated organization, including a non-stock
corporation, an incorporated membership organization, and an incorporated
cooperative);
e Labor Organizations;
e National Banks;
e Federal Government Contractors (including partnerships, individuals, and sole
proprietors who have contracts with the federal government); and
¢ Foreign Nationals (including individuals who are not U.S. citizens and not
lawfully admitted for permanent residence; foreign governments and foreign
political parties; and groups organized under the laws of a foreign country or
groups whose principal place of business is in a foreign country, as defined in
22 U.S.C. §611(b)). 2 U.S.C. §§441b, 441c, 44]e, and 441f.

B. Definition of Limited Liability Company. A limited liability company (LLC) is a
business entity recognized as an LLC under the laws of the state in which it was
established. 11 CFR §110.1(g)(1).

C. Application of Limits and Prohibitions to LLC Contributions. A contribution
from an LLC is subject to contribution limits and prohibitions, depending on several
factors, as explained below:
1. LLC as Partnership. The contribution is considered a contribution from a
partnership if the LLC chooses to be treated as a partnership under Internal
Revenue Service (IRS) tax rules, or if it makes no choice at all about its tax status.


Part I
Background

Authority for Audit

This report is based on an audit of Craig Romero for Congress, Inc., undertaken by the
Audit Division of the Federal Election Commission (the Commission) in accordance with
the Federal Election Campaign Act of 1971, as amended (the Act). The Audit Division
conducted the audit pursuant to 2 U.S.C. §438(b), which permits the Commission to
conduct audits and field investigations of any political committee that is required to file a
report under 2 U.S.C. §434. Prior to conducting any audit under this subsection, the
Commission must 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. 2 U.S.C. §438(b).

Scope of Audit

This audit examines:

The receipt of excessive contributions and loans.

The receipt of contributions from prohibited sources.

The disclosure of contributions received.

The disclosure of disbursements, debts and obligations.
The consistency between reported figures and bank records.
The completeness of records.

Other committee operations necessary to the review.

NANA WN


12

name of the employer for 30% of the contributions. There was no documentation to
indicate CRC used best efforts to obtain, maintain and submit the missing contributor
information. The Audit staff recommended CRC demonstrate that best efforts were made
or contact each contributor for whom the required information is missing and amend its
reports to disclose any information obtained. In response, CRC filed amended reports
disclosing the necessary contributor information.

Legal Standard
A. Required Information for Contributions from Individuals. For each itemized
contribution from an individual, the committee must provide the following information:
¢ The contributor’s full name and address (including zip code);
¢ The contributor’s occupation and the name of his or her employer;
The date of receipt (the date the committee received the contribution);
The amount of the contribution; and
The election cycle-to-date total of all contributions from the same individual. 11
CFR §§100.12 and 104.3(a)(4) and 2 U.S.C. §434(b)(3)(A).

B. Best Efforts Ensures Compliance. When the treasurer of a political committee
shows that the committee used best efforts (see below) to obtain, maintain, and submit
the information required by the Act, the committee’s reports and records will be
considered in compliance with the Act. 2 U.S.C. §432(h)(2)(i).

C. Definition of Best Efforts. The treasurer and the committee will be considered to
have used “best efforts” if the committee satisfied all of the following criteria:

¢ All written solicitations for contributions included:

o Acclear request for the contributor's full name, mailing address, occupation,
and name of employer; and
oO. The statement that such reporting is required by Federal law.

¢ Within 30 days after the receipt of the contribution not accompanied by complete
information, the treasurer made at least one effort to obtain the missing
information, via either a written request or a documented oral request.

e The treasurer reported any contributor information that, although not initially
provided by the contributor, was obtained in a follow-up communication or was
contained in the committee’s records or in prior reports that the committee filed
during the same two-year election cycle. 11 CFR §104.7(b).

Facts and Analysis

A sample review of itemized contributions from individuals indicated that CRC failed to
disclose the contributor’s occupation and/or name of employer for 30% of the tested
contributions. In some instances, the missing information was recorded on solicitation
response cards contained in CRC’s records. For the remaining contributions that were
missing information, there was no documentation available to demonstrate that CRC used
best efforts to obtain, maintain and submit the information.

This matter was discussed at the exit conference. CRC representatives had no comments.


Table of Contents

Part I. Background
Authority for Audit
Scope of Audit

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

Part III. Summaries
Findings and Recommendations

Part IV. Findings and Recommendations
Finding 1. Receipt of Prohibited Contributions
Finding 2. Receipt of Excessive Contributions
Finding 3. Failure to Maintain Receipt Documentation
Finding 4. Failure to Disclose Occupation and Name of Employer
Finding 5. Failure to Disclose Disbursement Information

Page

10
11
13


Report of the
Audit Division on

Craig Romero for Congress, Inc.
March 22, 2004 ~ December 31, 2004

Why the Audit

Was Done

Federal law permits the
Commission to conduct
audits and field
investigations of any
political committee that
is required to file
reports under the
Federal Election
Campaign Act (the
Act). The Commission
generally conducts such
audits when a
committee appears not
to have met the
threshold requirements
for substantial
compliance with the
Act.’ The audit
determines whether the
committee complied
with the limitations,
prohibitions and
disclosure requirements
of the Act.

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 Campaign (p. 2)

Craig Romero for Congress, Inc. (CRC) is the principal
campaign committee for Craig Romero, Republican candidate
for the U.S. House of Representatives from the state of
Louisiana, 3" District and is headquartered in Baton Rouge,
Louisiana. For more information, see the chart on Campaign
Organization, p. 2.

Financial Activity (p. 2)

¢ Receipts
Individuals $ 946,854
o Other Political Committees 15,743
o Loan from Candidate 70,000
o Other Receipts 2,350
o Total Receipts $ 1,034,947
« Disbursements
o Operating Expenditures $912,224
o Refund of Contributions 69,606
o Loan Repayments 45,000
o Total Disbursements $ 1,026,830

Findings and Recommendations (p. 3)

¢ Receipt of Prohibited Contributions (Finding 1)

Receipt of Excessive Contributions (Finding 2)

Failure to Maintain Receipt Documentation (Finding 3)
Failure to Disclose Occupation and Name of Employer
(Finding 4)

¢ Failure to Disclose Disbursement Information (Finding 5)

" 2 U.S.C. §438(b).


10

Interim Audit Report Recommendation and Committee Response
The Audit staff recommended CRC provide evidence demonstrating that the
contributions were not excessive. Such evidence should include copies of any fact sheets
that were not made available during the audit, and documentation that demonstrates that
the contributor entered the information on the fact sheets. Absent such evidence, it was
recommended that CRC send notices to the contributors informing them of the
presumptive redesignation/reattribution of their contributions and offer a refund of the
excessive portion. For notices sent to contributors, CRC was to provide a copy of each
notice and evidence that it was sent. Absent a request for a refund by the contributor,
these notices would avoid the need for a refund. If any contributors could not be located,
or if any refund check was not negotiated by the contributors, the sum of those excessive
contributions would be paid to the United States Treasury.

In response to the interim audit report CRC stated:

“As part of the initial fundraising for CRC, procedures were established to
be able to collect funds from contributors that were within the guidelines
for contribution limitations on a per election cycle basis. CRC personnel
used a fact sheet that alerted potential contributors of the dollar limitations
by date and asked them to acknowledge this when making a contribution
in excess of the $2,000 election cycle limit. CRC maintained extra bank
accounts to accommodate single check contributions in excess of $2,000.”
CRC continued, “When this entire issue is looked at from beginning to
end, no excessive contributions were retained by CRC. Donors were
notified in advance about the limitations, they were routinely offered the
fact sheet to fill out and the third cycle amounts were refunded. CRC feels
that it was in basic compliance with the intent of this law.”

CRC has not complied with the recommendations set forth in the interim audit report.
CRC neither provided copies of fact sheets that were not available during the audit or
demonstrated that the contributors completed the information on the fact sheets that were
available. Absent the above, CRC could have provided copies of presumptive
redesignation/reattribution letters sent to each contributor.

| Finding 3. Failure to Maintain Receipt Documentation

Summary

A sample review of contributions from individuals in excess of $50 indicated that 38%
either could not be associated with copies of contribution checks or lacked the necessary
records. The Audit staff recommended CRC provide the missing records or any
comments it may have relative to this matter. In response, CRC stated that the campaign
copied and maintained 100% of contributor checks and could not understand why the
auditors could not match contributions to copies of checks.


13

Interim Audit Report Recommendation and Committee Response
The Audit staff recommended CRC provide documentation that it exercised best efforts
to obtain, maintain and submit the required contributor information; or make an effort to
contact those individuals for whom the required information was missing, provide
documentation of such efforts (such as copies of letters to the contributors and/or phone
logs), and file amended reports to disclose any information obtained from such efforts. In
response to the interim audit report, amended reports were filed that materially corrected
the missing disclosure information.

| Finding 5. Failure to Disclose Disbursement Information

Summary
A sample review of operating expenditures revealed that CRC failed to disclose the

vendor address for 41% of the items tested. A majority of the missing addresses were
contained on vendor invoices found in CRC’s files. In response, CRC filed amended
reports.

Legal Standard
Reporting Operating Expenditures. When operating expenditures to the same person

exceed $200 in an election cycle, the committee must report the:

Amount;

Date when the expenditures were made;

Name and address of the payee; and

Purpose (a brief description of why the disbursement was made). 11 CFR
§104.3(b)(4)(i).

eee

Facts and Analysis

From our sample review of expenditures, the Audit staff determined that approximately
41% of the itemized disbursements did not disclose the vendor’s address. However,
approximately 98% of the missing addresses were contained in the vendor files.

This matter was discussed at the exit conference, CRC representatives had no comments.
Interim Audit Report Recommendation and Committee Response

In response to the interim audit report, CRC filed amended reports that materially
corrected the public record.