FEDERAL ELECTION COMMISSION 

WASHINGTON. D.C. 20463 

MEMORANDUM 

TO: 

OCT 16206 

Patricia C. Orrock 

Chief Compliance Officer 

Thomas E. Hintermister 

Assistant Staff Director 

Audit Division 

FROM: Lisa J. Stevenson 

. Deputy General Counsel - Law 

Lorenzo Holloway UH Vj«.j >15^^ 

Assistant General Counsel 

Compliance. Advice 

Margaret J. Forman 'yyj ^ 

Attorney 

SUBJECT: Proposed Interim Audit Report on the Utah Republican Party (LRA 1000) 

I. INTRODUCTION 

The Office of the General Counsel has reviewed the proposed Interim Audit Report 

("proposed lAR") on the Utah Republican Party C'URP"). The proposed IAR contains six 

findings: Receipt of Prohibited Contributions (Finding 1), Receipt of Contributions that Exceed' 

Limits (Finding 2), Misstatement of Financial Activity (Finding 3), Recordkeeping for Employees 

(Finding 4), Reporting of Debts and Obligations (Finding S), and Apparent Excessive 

Contribution - Staff Advance (Finding 6).' We concur with the findings, and comment on 

Findings S and 6. If you have any questions, please contact Marga^ J. Forman, the attorney 

assigned to this audit. 

We recommend that the Commission consider this document in Executive Seuion because the Commission 

may eventually decide to pursue an investigation of matters contained in the proposed lAR. 11 C.F.R. §§ 2.4(a) and 

(bX6). 
LRA 1000 Utah Republican Paity 

lAR Legal Comments 

Page 2 of2 

II. AUDIT METHODOLOGY ON STAFF ADVANCES IS APPROPRIATE 

Findings S and 6 of the proposed TAR note that a URP staff member received $197,850 in 

reimbursements from URP during the audit cycle, with most of these expenditures paid for with 

the URP staff member's credit card. Of those reimbursements, $46,904 occurred more than 60 

days from the date of the incurrence of the expense, as detailed on the URP staff member's 

reimbursement form. The Commission's regulations require staff advances to be treated as 

contributions, unless the payment is exempted from the definition of contribution under 

11 C.F.R. § 100.79. 11 C.F.R. § 116.S(b). If the payment is not exempted, it shall be considered a 

contribution unless (1) the payment is for a staff member's travel expenses or subsistence expenses 

incurred while traveling on behalf of the committee, and (2) the committee reimburses the staff 

member within 60 days "after the closing date of the billing statement on which the charges first 

appear if the payment was made using a personal credit card, or within thirty days after the date on 

which the expenses were incurred if a personal credit card was not used." 11 C.F.R. § 116.S(b)(l) 

&(2). 

We examine whether the Audit Division may use a date other than the closing date for the 

billing statement to determine if the expenditures incurred by the staff member result in a 

contribution. The Audit Division caimot determine the closing date for most of these expenses 

because the Committee did not provide a billing statement for most of the expenses. The URP 

provided the Audit Division with reimbursement forms, but only one credit card statement. The 

URP stated that it does not know the closing dates of the billing statements for the expenditures at 

issue, that the URP frequently received the reimbursement forms from the URP staff member well 

after the expenses were incurred, and that the URP issued reimbursements to the URP staff 

member within a calendar week of receipt of the reimbursement forms. 

We conclude that the Audit Division may use a date other than the closing date for the 

billing statement in this case. Here, the Audit Division used the information available; i.e.. the 

reimbursement forms provided by the URP staff member, for the relevant expenditures. These 

forms included the date of incurrence of the expenses themselves. Since the date of incurrence can 

occur on or before the closing date of the credit card billing statement, it is possible that the Audit 

Division's calculation of the 60-day date, used in those instances in which the URP failed to 

provide the billing statements, could have resulted in more expenditures being treated as 

contributions. However, the regulations provide that unless the requirements of 

11 C.F.R. § 116.S(b)(l) and (b)(2) are met, these expenditures shall be considered contributions. 

11 C.F.R. § 116.S(b). Therefore, we believe that the Audit Division's use of the date of incurrence 

to.apply 11 C.F.R. § 116.S(b)(2) is acceptable in this particular instance. If however, the URP is 

able to provide the Audit Division with foe credit card billing statements or other appropriate 

documentation showing the closing dates for these expenditures, we conclude that foe Audit 

Division must then use the closing date to calculate the timeliness of the reimbursements. See 

11 C.F.R.§ 116.5.