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FEDERAl. ELECTION COMMISSION

1\l'i K SIIUl' N.W.

W"~HI~G ION.D.C. 204&\

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REPORT OF THE AUDIT DIVISION

ON THE

FLYNT CAMPAIGN CO~~~ITTEE

I. Background

A. Overview

This report is based on an audit of the Flynt Campaign

Conunittce ("the conunittee"), undertaken by the Audit Division of

the Federal Election Commission in accordance with the Commission's audit policy to determine whether there has been complia~c~

with the provisions of the Federal Election Campaign Act of 1971,

as amended ("the Act"). The audit was conducted pursuant to

Section 438 (a) (8) of Title 2 of the United States Code which dir,~'::"::

the Commission to make from time to time audits and field invest~-;.:1-

tions with respect to reports and statements filed under the

provisions of the Act.

The Committee registered with the Office of the Clerk

of the United States House of Representatives on April 17, 1972,

in support of the Honorable John James Flynt, Jr., candidate for

the office of United states Representative for the 6th Congress~.,:-·

District of Georgia. The Candidate designated the Committee as

his principal campaign committee on March 18, 1976. The Co~mittc0

maintains its headquarters in Griffin, Georgia.

The audit covered the period from January 1, 1975,

through September 30, 1977, the final coverage date of the

latest report filed by the Committee at the time of the audit.

The Committee reported a beginning cash balance on January 1,

1975 of $12,163.16, total receipts for the period of $134,605.42,

total expenditures for the period of $146,384.52 and a closing

cash balance on September 30, 1977 of $384.06.

This audit report is based on documents and workin~

papers which support each of the factual statements. They form

part of the record upon which the Commission based its decisions

on the matters in the report and were available to Commissioners

and appropriate staff for review.

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B. Key Personnel

The principal officers of the Committee during the

period covered by the audit were Mr. V. Frank Jolly, Chairman

and Mrs. Selvey S. Perry, Treasurer •

c. Scope

The audit included such tests as verification of tot~l

repor-ted receipts and expenditures and individual transactions;

review of required supporting documentation and analysis of Committee debts and obligations: and such other audit procedures

as deemed necessary under the circumstances.

II. Auditor's Statement and Description of Findings

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

of the reports and statements filed and the records presented,

that, except for the deficiencies noted below, the reports and

statements of the Flynt Campaign Committee fairly present the

financial activities of the Committee for the period covered by

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

in complying with the Federal Election Campaign Act were

discovered during the course of the audit.

A. Reporting of Transfer

Section 434(b) (4) of Title 2 of the United States Code

states, in part, that a committee shall disclose the name and

address of each political comnlittee from which the reporting

committee received any transfer of funds, together with amounts

and dates of all transfers.

During our pre-audit review, it was determined that

a multi-candidate committee had reported a $500 transfer to the

John Flynt Campaign Fund on January 27, 1977. However, the

Committee's reports did not reflect the receipt of the transfer.

Through discussions with the Comlnittee Treasurer and contacts

with the treasurer of the multi-candidate committee, it was

learned that the transfer-in had been inadvertantly reported

as a contribution from one of the individuals who had signed

the multi-candidate committee's check.

On April 14, 1978, the Committee filed an amended

report correcting the error.

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Recommendation

Since the appropriate amended report has been filed,

we recommend no further action on this matter.

B. Cash Contribution in Excess of Limitations

Section 4419 of Title 2 of the united states Code

states t.hat no person shall make contributions of currency of

the United States or currency of any foreign country to or for

the beru·rit of any candidate which, in the aggregate, exceed

$100, wit.h respect to any campaign of such candidate for

nomination for election, or for election, to Federal office.

Our review of the Committee records revealed that

the Committee held a fundraising dinner on October 26, 1976,

and reported receipts from the dinner totaling $2,475.00. The

Committee reported the required itemizable fundraising contributions

on separate schedule A's (line l5c).

The Committee made three (3) deposits to its checking

account consisting solely of proceeds from the dinner. These

three (3) deposits accounted for the total proceeds of the event

as shown in the Committee records. Two (2) of the deposits were

made on November 1, 1976, a $1,625.00 deposit containing only

checks, with the contributors' names listed on the deposit ticket

and a $675.00 cash deposit. The third deposit was made on November

10, 1976, in the amount of $175.00. A comparison of Committee

records and reports with the deposit tickets revealed that a

$500.00 contribution, reported as being received as a result of

the fundraising dinner, was not among the items listed as checks

on the Con~ittee's deposit tickets. Therefore, it appears that

this contribution was made in cash and included in the $675.00

cash deposit.

Recommendation

Since the Committee has acknowledged rece~v~ng this

contribution in cash and has provided the Audit staff a copy

of the check used to refund the excessive portion of this

contribution to the contributor, we recommend no further action

on this nlatter.

c. Debts and Obligations

Section l04.8(a) of the Commission's Regulations

states, in part, that debts and obligations which remain

outstanding after the election shall be continuously reported

until extinguished. These debts and obligations shall be

reported on separate schedules together with a statement

explaining the circumstances and conditions under which each

debt and obligation was incurred or extinguished.

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The Committee reported a $10,000 debt on its Debt and

Obligation Schedule (Schedule C) during the first quarter of 1977

along with an $8,000 payment reducing the balance to $2,000. On

May 20, 1977, the Committee paid this debt but did not disclose

the final pay~ment on Schedule C for period April 1, 1977 through

June 30, 1977.

Additionally, the $10,000 loan had been reported on

Schedules A and C for the period October 19, 1976 through November

22, 1976, although verification with the Committee's bank records

and the bank's loan records revealed that this loan had not been

made to or deposited by the Committee until December 3, 1976.

The treasurer indicated that the original loan was

reported in error on Schedules A and C for the period October 19,

1976 through November 22, 1976 but was not aware that the loan

was not continuously reported as required.

Recommendation

The Committee has filed the necessary amendment to Schedule

C, properly disclosing the final payment of the reported $10,000

debt. The Committee has also filed a statement explaining the

discrepancy noted concerning the date this loan had been reported.

Therefore, we reconunend no further action on this matter.

D. Retention of Supporting Docum0ntation

for Expenditures

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Section 432(d) of Title 2 of the united States Code

states, in part, it shall be the duty of the treasurer to

obtain and keep a receipted bill, stating the particulars, for

every expenditure n,ade in excess of $100, and for any such

expenditure in a lesser amount, if the aggregate amount of such

expenditures to the same person during a calendar year exceeds

$100.

Section l02.9(c) (4) of the Commission's Regulations

states, in part, that when a receipted bill is not available,

the treasurer m3Y keep the cancelled check showing payment of

the bill: and the bill, invoice or other contemporaneous

memorandum.

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rcontemporaneous memorandum for seven (7) expenditures. These

items totaled $5,642.83, representing 4.1% of the dollar value

and 8.0% of the number of all expenditures requiring supporting

documentation. The Committee treasurer agreed to obtain and

forward these documents to the Audit staff for review.

Recommendation

Since we received copies of the necessary supporting

documentation on April 6, 1978, we recommend no further action

on this matter.
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• Candidata/Committee:

CONGRESSIONAL AUDIT REPORT

John Flynt

State:

District:

Location:

Georgia

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Atlanta Suburbs

Political Par~1 Affiliation: Democrat

Major Oppcnent(s): Newt Gingrich (R)

Other C~ndidatas ~uditad: . Gingrich

Votes Cast: General E'ec~ion - Flynt 77,532

Primar"J E1 ec~i en - Flynt 40,125

Gingrich 72,::~

Frank Bailey

Total ~ecai~ts rer ?sriod: $134,605.42

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rot~l ~;enditur~s for ?~riod:

Firs~ ~iec~ad (if :~piic3ble):

$146,384.52

1954
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