FEDERAL ELECTION COMMISSION AltOOS937

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January 24, 1995

MEMORANDUM

TO: RONALD M. HARRIS

PRESS OFPICER

PRESS OFFICE

FROM: ROBERT J. COSTA fU...~~.~.L. l~qS­ ASSISTANT STAFF DIRECTOR

AUDIT DIVISION

SUBJECT: PUBLIC ISSUANCB or THE FINAL AUDIT REPORT ON

JIM BATES FOR CONGRESS

Attached please find a copy of the final audit report

on Jim Bates for Congre•• which was approved by the

Commission on January 10, 1995 •

Informational copies of the report have been forwarded

to all parties involved aDd the report aay be r.l••••d to the

public.

Attachment as stated

cc: Office of General Couna.l

Office of Public Disclosure

Reports Analysis Division

FEe Library
FEDERAL ELECTION CO,\1MISSION

WASHtNCTON. 0 C ;04CJ

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I. Background

A. Overvi."

Thia report 1. ba••d on an audit of Ji•••t •• for

Con9r••• (the Co..itt••), undertaken by the Audit Division of the

'ederal Ileetion Coaai••ion in accordaftce vltb the provi.ions of

the rederal Ilection C••pai9n Act of 1971, a....nded <tbe Act).

The audit va. conducted pursuant to .ectlon t31(b) of Titl. 1 of

the United Stat•• Code which atat•• 1ft pact tbat the Co..i ••ion ••y conduct audits and field inv••tigation. of any political coaaitt•• requi-ied to fii..- • c.poct- uncl.f _••ction 434 of this

title. Prior to conducting any audl~ undec tbi•••ctlon, the

Coaaia.ion .hall perfor. aD internal revi•• of report. fil.d by ••lected eo..itt••• to deter.ine if the report. filed by a

particular co..itt.....t tbe tbr••hold require.eats for

substantial coaplianc. with the Act.

The Co..itt.e register.d vith tbe Clerk of th. Bouse of

aepr•••ntativ•• Oft October ~', 1981. and ..tnt.in. ita

headquarter. in San Die,o, Califocnia.

Th. audit covered the period January 1, 1989. through Dec.abet 31, 1990. ~. Co..itt•• reported aft opening ca.h bal.nce

of $80, total receipt. of $712,967; total 4i.bur....nt. of

$144,.'" aDd. clo.ing caah balance Oft Dec.aber 31, 1990 of

S28,580·Y

Thia report ia ba••d on docua.nt. and vorkpaper. supporting .ach of it. factual stat•••nt.. They for. part ot t~e

record upon which the Coaaission ba.ed ita deei.lon. on the

.atters in this r.port and vere available to Co..l••ioners and

appropriate staff for review.

~/ Th••• totals are .i.sta~.d, s•• Finding II.A. All ••ounts

are :ounded to the n••r••t dollar.
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8. ley ••r.onnel

During the period covered by the audit, the Tr•••urer

val Tiaothy Pi.lda. The current Tre••urer 1. Sandra .ennedy.

c. Scope

Th. audit included .uch te.t••• veriflcation of total

reported r.c.ipt., di.bur••••nt. and individual tran.action.;

revi.v of r.quired supporting docu••ntatloft' analy.i. of debt. and

obligation.; and .uch oth.r audit procedur•••• d••••d nec•••ary under the eireu••tanc••, exc.pt that our r.view of dl.bur••••nt.

va. li.it.d b.cau•• the Co..itt•• failed to ••tnta1n cancelled

checks for 1989.

II. Audit rinding' and Reco...ndatlon8

A. Mi.state••nt of rinancial Activity

S.ction. 434(b}(1), (2) and (4) of Titl. 2 of the United

Stat•• Code state, in part, that each report aball dl.clo.e the

aaount of eaah on hand at the beginnln9 of eacb r.port1ft9 period, the total a.ount of all rec.ipts, and the total aaount of all

di.bur••••nt. for the p.riod and calendar y.ar.

The Audit .taff reconciled the Co..lt~•••• eeported activity to it. bank activity for th. p.riod January 1, 1989

throu9h D.c.ab.r 31, 1990. The reconciliation te•••l.d the

follov1n, ai.stat•••at. relative to calendac Y•• 1990.

1. aeginning Balance

The Coaaitt•• report.d a be9inalD9 c••b balance at

January 1, 1990 of $38,951 which v •• o••r.tated by S'65 a. a

r••ult of tvo 19" ~i.bur....nt., tot.lln. ".0, vblcb the

Co..itt.e did not con~1d.r in arrlving at the be9iDin9 c••h

balanc.. Tb. r...lning $175 diff.rence va. ua••plalned. Th.

correct b.ginning balanc. v •• $38,392.

2. R.ceipt.

Th. total a.ount of receipts v•• understat.d by a

net ••ount of $15,365. Th. ai••tate••nt r••ulted feo. the

Coaaitte.'. failure to report receipts totaling $10,113 and

.ileel1aneoua reporting probl••• tota11ng $5,252. The correct

total for receipt. v•• $632,008.

3. Di.bur••••nts

Th. total a.ount of di.bur••••nt. va. und.rstated

by a net ••ount of $41,464. Th. ai.stat...nt r••ulted fro. the

Co..itt••'. failure to report disbur••••at. tot.11ftt $50,098 and

.i.eelian.ou. reportin9 probl••• totaling -$2,634. Th. correct

total for di.bur••••nt. was $674,483.
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4. !ndin9 Balance

The reported ending cash balance at Deceabe, 31,

1990 wa. over.tated by $32,764, resulting fro. the ai••tate.enta

detailed above. The correct ending balance va. -$.,184.~1

Co..itt.e official. stated that they would file the

appropriate a••nd••nt. to correct the .i••tate••nts. Copies of

schedule. detailing the explained differene•• v.r. provided to the

Co..itte. at the exit conference.

The interia audit report reco..ended that the

Coaaitte. file a coapr.hen.lve a.endaent for cal.ndar y.ar 1990 to

correct the irregularities de.cribed abov••

On June 14, 1993, the Co..itt•• filed an ••ended

report which .aterially corrected the ai••tate••nt.

aeco...ndation 11

The Audit staff reco..end. no further action with regard to

this ••tter.

B. Other Matters

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Other ••tters noted during the audit have b.en referred

to the Co..i ••ion.'. Office of General Coun••l.

~I The endln9 balance aa reflected on the bank state••nt wa.

$388. Check. outstandin9 as of oec.abet 31, 1990, as

calculated by the Audit staft., totaled $.,571, r••ultinq

in the ne9ative cash balance.