Interim Audit Report of the 

Andlt DMelon on the 

Coneeiwalive imorlty Fond 

(Jul^ 9,2012 - December 3I» 2012) 

Why the Audit 

WSuDom 

Fedend low pcfmits the 

rnwimiarinw te 

auditi and field 

invcflligBtiaDS of aiqr 

political oonunttlee that ia 

raquired to file n^otli 

untefiieFedenl 

Election Campaign Act 

(the Act). Hie 

Communion genenlly 

oondncti uicfa audita 

vdien a committee 

appean not to have met 

tiic tfareahold 

lequiiementi fiir 

wihtaiitial compliance 

withtbeAct' Theaudit 

detenninei udietiier the 

GommitlBe complied with 

the limitatiaos, 

prohibitiona a^ 

dfacloiiire lequiitmeats 

of the Act 

Patun Aetlim 

TbeCcmmiaiionmay 

initiate an enfincement 

action, at a later time, 

with mpect to any of the 

matten diacnned in tide 

report. 

Abont the CommlttM (p. 2) 

TTteConeereativB Majorily Fund is anon-connected cnmrniltee, 

headquartered in Arlington, Vixgjnia. For more fadfannation, see 

the chart on Comndtlee Oiganizaticiit p. 2. 

Flnaiielel ActMly (p.2) 

o CootrilNitions fiom IndividnalB 

Total Recdpts 

DUMI 

o Openting Expenditures 

o Independent Expeutitnres 

Total Wsbniasarents 

$2,814,766 

S2314|766 

$1,398,617 

1347,233 

S2,74$i858 

PSndlnei and Becommendetloiis (p. 3) 

• Misstatement of Financial Activity (Finding 1) 

• DiscloBureofOocupationaiidNameofEmployer(Flnding2) 

• Reporting of Apparent Independent EaqrenAtmes^inifing 3) 

• RepcrtliigofDebts and ObligBtions (Finding 4) 

• RecGnlkieepinglQrCoimniBiic8tion8(nnding5) 

• S2U.S.C. (30111(h). 
Interim Audit Report of the Audit 

Diuieion on the 

Coneervutiee H^Jority Fund 

(July 9, 2012 - December 31, 2012) 
Table of Contents 

Ftoie 

Futl. BMkgRmnd 

Auttiority for Audit 1 

Scope of Audit 1 

Vutn. Overvtevr of Committee 

rnmmiH— On^iHoofanw 2 

Overview of FfaeuGlelActivily 2 

Futm. Sammariee 

PlfiiMfip oml PfftwtimowlotMwff 3 

Fart IV. Fladlngji end BeeonuneadetloBe 

Fiudiinl- Mi—fBliniiinul ofFinencial Activity 5 

FSndingZ. DiMloiufeofOeGieotioanidNaiiieofEiiqilQyGr 6 

Findings. Reporting of AppueotlndqieiMlantBxpenditureB 8 

I%idiiig4. RqwitingofDiibtBandOMigrtiniM 13 

Findings. RccoidimeuefofCooMnimioeinne 14 
PwrtI 

Barlrgronnd 

Antborlty for Andit 

Thii icport tt twiod on an audit of te Coniervadve Mqority Find (CMF), iBdertakcn by 

the Audit Divisian of the Fedeml Election Commissian (the ConmiiHioiO in accoedancc 

with the Fednal Election Campaign Act of 1971.88 anuDded (the Act). TheAndit 

Division conducted the audit puEBuant to 52 U.S.C. {30111(b). which penmis the 

rnwitniMon tn etmOuef rnoMt* and fleM ftHMiiigprinna fff ty i^irii|itr|Mwf flyt if 

xequirad to file a lepoit under 52 U.S.C. {30104. Mor to eonducliiig any andit under this 

subaection, the Cnmmiiiaion must peribnn an internal leviewofieports filed by seleclBd 

conunitleei to detamine if the leports filed by a particular Gonunittee meet the tliiesliold 

lequirenienti fiu'substantial ooD^liaiice with the Act 52 U.S.C. {30111(b), 

Soope of Andlt 

Following Conimiss'ioibnpprovBd procedures, the Audit staff evahMted various riA 

ftcton as a result, fins audit cxamiued: 

1. the diaclosuie of oontiibations received; 

2. the discloBureofindividualoontilbulan'oGciqadion and name of employer; 

3. the diartosureofdebts and obligations; 

4. the consialBncy between Rpocted figures and bank recaeda; 

5. the completeness of diabuEienientreeoids; 

6. thediaeiawteofindependeBtciq>enditureB;and 

7. other coiuiuittBe operations necessary to file review. 
Futn 

Overview of Committee 

Committee Organimtion 

iMMlwitlklei 

• DiteoflUaiili^Inn July 9.2012 

• Audit OwniMB July 9.2012 - Deoeote 31,2012 

HMMVINI AiUnatoiu VMida 

Buk lalbnBadoB 

• BmkDBDOribvki One 

0 BankAocounti One Checking AcGount 

TiiwrT 

o lYDBnRrWhBaAudhWMCoDductBd SoottNfackenrie 

• IYBMRT During Period Coverad by Audit Soott Idackanzie 

July 9.2012 - December 31.2012 

• AHi-flided rnmntiininn rrnnjieign Finenee 

Seminar 

Yes 

e Who Handled Aooounthig and 

ReconikBqdiig Taiki 

Tieamer 

Over view of Financial Activity 

(Andtted Amoimts) 

CMb«»tand a M 9.2012 SO 

RaaMi 

o Conatibutwos fiom Individuali 2JK766 

Total BaertHi S2Jlii7a 

OUbniaHicati 

o OnemtoEBiniendlhnea 1,39U17 

o I fadepandBBt 1 BnendllneB 1347033 

S2.7aja 

Chabwkand a Deeeeber 3h 2012 smsi€ 
Furtm 

Sommailes 

Findings and Reconunendationa 

nndlag 1. MtoetatemeiitofFliiaiieialActiwIty 

The Audh stiffi ooo^Mriflon of CMPi fiiMDcial activity with ha bank Rooidi fcveded a 

material miaatatementofdiabiinEmenli in calendBr year 2012. CMFmiaalatedits 

didNnaemeDti by $2,163,830. Tlw Audit atafifiecommends that CMF amend ita 

diadoauR iqxuta to comet the identiOed miaatatement 

(For more detril, aee p. 5.) 

Fladiiig2. DiaclommofOeeapatloiiauidllameof 

•teplofw 

During audh fieldwoik, a leview of all contrihutiona ftom individuala requiring 

itemization indicated that 527 contributiona totaling $86^745 lacked diacloaure 

oftfaecontributor'a occupation and name of employer, CMFdidnotdemonatiate'tat 

cfEbrta" to obtain, maintain and aubmh this infonmition. The Audit ataff reoommenda 

that CMP file amended repoita to comet the diacloaura of the contributor'a occupation 

and name of employer. 

(For mon detail, aee p. 6.) 

Findings. Reporting of AppamntlndmpendBnt 

B^onditofoo 

During audh fieldwoifc, the Audh ataff reviewed diabunementa to verily the independent 

expcndhurea that CMF leported on Schedule B (Itemized Independent Expenditures) 

were accuntely and Gcm^letdy diacloaed. 

The Audh ataff identified diabuisementi totaling $469,136 which were not lepofted aa 

apparent independent ciqienJiluicB. Alaoindqiendentexpendhurea totaling $185,663 

were diacloaed wiA an ineomct vendor name. 

With reapeet to die filing of24/48-hDur repoita required for ceriain independent 

expenditurea^ CMF did not file 24-hour rqioita totaling $90,260 in a timely manner and 

did not file 2W484iour reporta for appaieiil inrinpmdent expenditurea totaling $469,136 

noted above. 

If CMF believea that the apparent indqiendent expeiidituEea, totaling $469,136, did not 

reqjuhe rapoitiiig aa independent expendhuiea, the Audh staff lecommenda diat CMF 

provide evidence to aiqi^ its Goneluakm. Absent such evidence^ the Audit ataff 

reoommenda that CMF amend ha reporta to disclose these diaburaementa aa independent 

expendhurea on Schedule E and snbinh revised procedures for reporting Indqiendent 

expenditures. It is also recommended that CMF amend its reporta to comet the vendor 
ifeflieindqicndeuteKpendftiiics totaling SI 85,663. Lastly, the Andit staff 

loixwiTncwb that CMFfaoWdedociiinentatian to sigiport the tiin^ filing of 24-hour 

npoitB totaling $90,260 and documealatioo to support the public dissemination tfar 

communications tobding $469,136 to delcnnine whethor a 24/48-bour iqxnt was 

letpnied. 

(For mora detail, see p. 8.) 

niidliig4w RsportiiigoflMitosuidObllgfttloiis 

Dnring audit fiddwoik, the Audit staff identified debts totaling $67,800 that were not 

disclosed on Schedule D (Debts and Obligations) as required. CMF contends that h was 

not lisbk tor a portion ofthc expenses, u they were incucied by anatfaer committee. The 

Audit ataffwoommends that, ab^ documentation demonstrating that these 

csqmihmea did not require reporting on Schedule D; CMF amend its reports to disclose 

tnesedeMSt 

(FOrmore detail, see p. 13.) 

UndliigS. RMordhMpliig Itor Commimlcatloiis 

During audit fieldwofk, the Audit staff reviewed didMinementB to verify the accuracy of 

toe infoimatinn and proper claaaiflcaticnoftiansactiDnsdiacloied on gqwrts, TheAjudit 

staffidentified $304^399 tor wUcfasufSdentnoonls were not provided. V^thoutaoopy 

oftheinvoicea and the asanciatndcnminiimciitiona, the Audit staffia unable to detcnnine 

how CMF should have reported these dlsbunemenla. The Antot staff reoommendatoat 

CMF providob in sufiBcieiit detail, the neceasuy bitormalion fiom which the 

disbursementa totaling $304,399 be verified or eiqilained. Such records should 

include copies of invoices and identLBcation of toe BBSOciafed communication, and, if the 

communicil'^ ptwwLUt, aawitaritig mmnh wtmtMinlaQtlnw 

vritoaninvoloe(s). 

(Formore detail, see p. 14.) 
Put IV 

Findings and Recommendations 

I 1. MiMtatwnut of Financial Activity 

Hie Alidh ilairs oompariaon of CMF*s finandal activity vddi its bank focoidi roveiled a 

inalariainiisitHlemeiitofdiabuneiiMnta in calendar year 2012. CMFmlsalatedita 

diabunaneDlB by $2,163,830. The Audit ataffiecoiiuiMada that CMFaaMad lb 

diaelowie icpoftt to Gofnct tiie identified miabateiiieot 

Cantab of Raparii. EachvepoitniutdiacloBe: 

a the amount ofcatiiHxi-hand at die begiiniiig and end oftheiqiacdDg period; 

a the total amount ofieccipb for toe lepmliiig period and far the cekadar year, 

• toe total amount ofdisbunemcnb far the npofting period and for the calendar 

year; and 

• certain tranaaetians that mpme itemization on Schedule A (ItcnrindReeeipb) or 

Schedule B (ftemiaBd Diiburaemenb). S2U.S.C.{30104(hXlX(2X(3)t(4).and 

(5). 

A. Pacta 

During audit fiddwoih, the Audit staifieooDciled CMFsicported financial activity with 

its bank lecocda far calendar year 2012. The nooncUiationdetennined that CMF 

miaalBleddiriiuxaementa for 2012. Ihe fallowing chart outlinei the diacnpancies 

between CMF'adiaelosuieiepoito and its bank leooida. Theaucoeedingpamgnpha 

eaqdam wity the diaeiepancies occuned. 

2012 Committee Activity 

-M HHimimi Barik Rceevda Phrrapaaey 

Bagmning Cash Balance @ 

Jidy9.2012 

SO SO SO 

Receipto $2,814,767 $2,816,253 ($1,486) 

UndenlHled 

Dirimnemeota $2,745,851 $2,747,337 ($1^ 

Underataled 

Caidi Balanre 

lb December 31.2012 

$68,916 $68,916 SO 

CMF understated ita diabuiaeuiBUta by $1^486 in 2012. However, ariien evaluating the 

identified enoiB, legaidleai of whetherihe cnoia wen positive or negative (abaolute 
vahie), the Audit alafif diaoovered that CMF ndsitatod ha dubunemenb by $2,163330 ai 

follows; 

The miaalalemeiit of diabuzsemenls leauhed from the foltowing dMBeencea: 

• RxpcnditiwauadeHcportBdornotrqxMtBd' $1,081,176 

• BqwndltiBBaovcHqwitBdorDotaiqiportedbybankpiqnnenla 1,081,172 

• Bi^chKgeiiiotnportBd IM2 

SaaofRepofftfaigAdlMtmaiti 82,163338 

B. letcrlm Awdtt Report A AndttDhrlBlnRecoauMBdatlM 

At the exit oonfrnnce, the Audit ataff provided schedulea of the miaataCed MtiviQr and 

Jill ^IIIIP Ihm ttww that ewi^ thm miftmiffiniwf The CMF lYBSaunr had DO 

addiliooal oommeots. 

The Audit ataffjecomrnends that, within 30 calendar d^fs of aenrice of foiaiepoe^CMF 

amend hsiqxuts to coneet foe mSaalateinenli for 2012 as noted above. 

Finding 2. DiselonmofOeenpationandllanMof 

Emplgyr 

During audit iSeldwaik, a review of ail contributioiia from individuals lequuing 

itemizatinii indicated that 527 contributiooB totaling $86^745 ladccd adeqiarte diacioaure 

oftheconlrihulur's occupation and name of cniidoyer. CMF did not demonatiale "heat 

wffiintM" fn mi'ntwln «mH mhmnlt thin The Audit Staff reCOmmCndS 

foat CMF file amended xepoits to oonect the diacloBure of foe contributoi^a occupation 

and nanae of employer. 

A. RequiFed laforaution for ContributlDni from Imdhrldaali. For cadt Itemized 

contribution from an individual, the coiuinitlee must provide foe following 

infonnation; 

• the oontrfoutor'sfiill name and address (meluding Bp code); 

• the conlrihutor's occupation and the name ofliia or her employer; 

• foe dale ofrecdpt (foe dale the oommittee received the contribution); 

• the amount oftheoontributian; and 

• the cakadaryeaHo-dale total ofall contributioiia from foe same indlviduBl. 52 

U.S.C. {30104(bX3XA) and 11 CFR S$ 100.12 and 104J(aX4Xi). 

B. Baat Efforts EaanieCaaipUanceu When the treasurer of a poillkal committee 

diows that the ootnmittrifi used beat cfRuti (see below) to obtain, maliitain, and aidanlt 

' Tlili mount inefaidM two mpadSoNiialriiiigSTMai IhrwiiSchdocuiuwiillunwsiiMufllchBtiD 

iiuim • ihiinimlirtinn |ii ililiihu in hnw Ihnwi illilMwiiiirti eiimlil Im iitiiiiliiil SnReconlmpimihr 

CnmBimkuiiiiB Fimfog P^IA 
the tnfbmiatioD nquind by the Act» the ooDuiuUee'B npoitB md lecoBdi will be 

conridcwdnicompMinBewittttbeAct 52U.S.C S30102(i)aiidl1 CFRS104.7(a). 

C. DeftaMeBiifBartlEllnti, ThetreaBURrmdlheooiiiimtteewiUbcoooflideredlo 

have used "lieit effiirti" if tbe oonimitlBe aatiified an of the fidlowing criieria. 

• AUenitlcaaoIidtadoiufiirooiitiibiitiaiianicliided: 

o acteariegncatfatfaBContabiiiortMnaine^inaUhigaddreM^occiipalioii, 

and name of emidoyer; and 

o the itateniem that WGhiepafthigiazequiredhyFedenl law, 

o Note; Hie requert and atatement must appear in a dear and oonqacuous 

manner on any reqioiiae material included in a aoUchatioiL 

• Within 30 dqnofreGeiptofdieoontiibutioiw the treaauier made at teaat one 

eflbrt to obtain the miaaing infiinnatian, in either a written leqneat or a 

doGumenled ond leqpeaL 

• The traaaunricparted any contributor inibnnatian that, although not fadtiBlly 

provided by the contributor, waa obtahied in a fidlouHgi oommumcalian or was 

contained In the oommhtee'a reooida or in priorieporta tiiat the oommhtee filed 

during the aame two-year election cycle. 11CFR 1104.7(b). 

A. Facte 

A review of all ooaliibutiona fiom individuab rei|uiriitg itemization iialiGated that 527 

oonliibutionB totaling S86,74S, or 3096 of total oontiibuliona fiom individuBia lequhed to 

IMI itemi'iifl ly rup^ IOHIBMI Mmninmwm wTftm fH flBTIft ftf 

cmpbyer. For moat oftheaeentriea. the contributor'aoocqiBtion and name of employer 

infonnatton (455 of527) were Mank on die Schedule A OtoniaBdReceipti) filed with the 

Cnrnmiawon. 

The Audit staff reviewed the receipt reoorda provided by CMF to detefmine if h had 

MtiliMii aflhrta* tn nfctei'n, nuimiMin nd Milwiit thm mtfing 

• CMF did not provide documentatioaflhowing it made follow-q> beat efforts 

requeate for 48 oontiibutiooa totaling $9^40 ($06,745 -$77^). 

• CMF bad the required infinmation for 479 contributiona totaling $77^405; 

however, thiiinfonnation was not dfacloaed on itadiacloBurerepoiti. 

In reqxmae to the audit, CMF atdnnitted written procedures of "best efibite" 

requhguenta;(0 within thirty dre^ofthe receipt ofthe contribution, a tetter would be 

ae^ cteariy adidita for Ae miaaiiig inibimatten, without soliciting a contribution; (ii) 

contfibutora would be informed of foe requiiemeotB of fedendlaw fiir the reporting of 

auch infoanatiaii; and (iu) a pre^ddreaaed return envelope^ a fox number and an email 

addteaa would be proviM to the contributor. The TVeaaurer staled that upon receipt of 

the information, CMF would amend its reports to provide the new infomiBtian. AHhougfa 
8 

contributais, CMF did not provide confirmation that tbeae follow up letten were sent to 

cantributan. 

B. InfiiteAadltR^ortA AMlltDifUiNiRccMiMBdatlaii 

M te cat copfewuce, the Audit itifiFprovidedachBdttleB and riiBciiMBd the omiawon of 

theoootribiilor'soGcivutkinandiiaiiieofaiiployer. The CMF TkeBfurerooamieatBd that 

hehadobtefaiedatotoftlicmiaMngocciipatkmandmBiiDofBniyloycriiifoimalkm. In 

icapoiue to Ifae exit oonfeiHin. C34F ixovlded documentation ddaUing the oantributar*a 

OGGDpadcm aiul name of emplogrer bfixrnmlkm ftir $45,369 of the enoia^ however 

amandeddiacloBurenpoitB were iKM filed.' Hds amount iainciuded in the $77^405 noted 

above. 

The Audh staff leoonunends Aat, widdn 30 calendar dagra of aeivice of this iqKxt, 

QtilF eaiabUah "beat effinta" by amending ita icpoits to (fiadoae the miaiqg infomiatkm 

lelating to the 479 conlribiitiooa totaling $77»40S. 

Findings. RnportlngofAppnmtIndepandnnt 

During audit fieidwDik, the Audit staff leviewed diaburaements to verity the bdeiNndent 

expcndituiea that CMF iqanted on Schedule E (Itemized Independent Expendhuraa) 

were accuiateiy and complnfely diaclosed. 

The Audit staff identified diabuiaaments totaling S469.136 vriiich were not iqaated as 

apparent independent expenditures. Also independent esqiendituRa totaling $185^ 

were diaclosed with an inconect vendor name. 

With retpect to the filing of24/48-hourwporta required fig certain independent 

expeoditurea, CMF did not file 24-hour Tqxxta totaling $90,260 in stingy manner and 

did not file 2^48-hour reports fig apparent indqModent expenditntBa totaling $4tS9,136 

noted above. 

If CMF befievea that the apparent independent enqgnditurea^ totaling $469,136, (fid not 

inquire reporting ai indqiendent eiqieiidhurea, the Audit staff reccnunenda that CMF 

provide evidence to support its conduaian. Absent such evidence, the Audit staff 

ircxmiinwsh that CMF amend its iqxgts to diadoae these diabmaeinema as indqiendeat 

expenditures on Schedule E and submit revised piDoedures fig reporting independent 

expendituies. it is also recommeiided that CMF amend its leporta to correct the vendor 

name fig the hidependeatcxpendilurea totaling $183,663. Lastly, the Audit staff 

lecommenda that CMF provide documentation to support the tiin^ filing of 24-hour 

repoffci totding 100,2150 and AMaunenttlnn (n Mipfvw* pibliV difi^iri||inirti^y fSnf 

' CliilPadsiabinconlrioedllieoociprtiiiBBidiianworeBplayBrinfbmMtiiiDlbraQBdditianBl203 

eonaflnliau totsltaa 832,036. 
GonmunMlioiiB totaluig $469,136 ID detmnine wliete a 24/48-hour iqxiit was 

raqnired. 

A. Dfihliliwi of iBdipwdwt Kipapdltiiw. Thetenn'SndepaideatexpeDdilura^ 

meani an oxpcnditinc by a paaon fig a comimmiciirioncaqMBMly advocating the 

•iliirtinn iw «f • trnmAlAatm Im wn* IMAI hi ftftftwIinafUw 

with aiycanifidiitB or audioriaedcommiace or agent of a candidate, IICFR 

S100.16. 

B. DhdoMgaRagnfaiBiwia-GanandGnlddinaB, Anmdepeodentcxpenifilmeihali 

be iqxnted on Schedule E when added to other independent expen^tinci made to 

the mme payee during the aame calendar year, it cxceeda $200. Indqwairient 

expadituiea made OLe., publicly diaaenUnaled) prior to payment rimuld be diacloaed 

as memo enlriea on Schedule Band as a debt on Schedule D. Independent 

expendhures of $200 or kae need not be itemized, though the ccnunitlee must icport 

the total oftiboae expenditures on line (b) of Schedule E. 11CFR {§104J(bX3XviiX 

104A(a) and 104.11. 

C Lart-Miante Independent FipmdHnte Rsporti (24-Hoar Raports). Any 

independent ciipeudlhaiMaggjgpillngSljDOO or ntote, with wspacttoany given 

cleedon, and ffl^ after thn 20Fdqp but man than 24 houn beifaR the day of an 

etection, must be lepcfled and the report must be received by the Commission within 

24 hours after the expenditure is made. A 24-hour icport is required each time 

additional tndq)endenle]qiendituresag|pcgBlB$l/KX) or more. Ihe date that a 

conununicxtian is publicly dissemfaialed serves as the date that the committee must 

use to detennine whether the total amount of independent expenditures has, in the 

aggregate^ reached or exceeded the thredhoidRpoiliiv amount of $1/100. IICFR 

§§104A(Qandl04.3(^). 

D. Independent KxpendUnn Reports (48-Hear Reports). Any Independent 

expenditures aggrogatbig $1(^000 or more with respect to ai^ given election, at any 

time during a calendar year, iq) to and including die 20th dqy before an clect^ must 

be disclosed within 48 hours each time the cxpendhuies aggregate $10^000 or more. 

The iqxxta must be received by ftie Commission witUn 48 homs after die 

expenditure is made. The date tfatf a communication is publicly disseminated serees 

as the date that the committee must use to delenniiiB vriKther the total amount of 

independent expenditures has, in the aggregate, reached or exceeded the threshold 

reporting amount of $10,000. 11 CFR SS104.4(0 and 104.5(^1). 

E, DefleWmi of Kxprusly Advocating. The term''expreaalyadvocatingr means any 

flnnnniitwwition thft* 

• Uses phrases such as >016 fiir the PrBBiden^'"Ye-«lect your Congnssman," 

"drfhat* hy • |MehiM iif OM nr tiwwy 

incumbent,'" or ccmmunlGaftans ofdagBn(s) or intividual WDnl(sX 

which In comext can have no other reasmiabiG meanmg than to urge the eiert^ 
10 

or defeat of ooe or moie cleaily identified caEididate(B), such as poBlen. bomper 

•tidten, advertiacincnis; or 

• When taken as a whok and with limHedraferenoe ID extemalevonti, such ai the 

proximity to the election, could only be iuleipietcJ by a leaaonaMc person as 

containing advocacy oftfac election or defeat ofone or more cleaiiy identified 

candidate(s) because: 

o dm elcctoral portion oflfaeconimunication is unmistakable, unambigiious, 

and suggestive of only one meaning; and 

o leasonable minds could not differ as to wfaetfaer it cncounges actions to 

deet or dedsat one or more cleaiiy identified candidatB(s) or encouiages 

some other kind of reactioa 11 CFR{100,22(a)and(b). 

F. FimallteqnlromontsllegBnlingRaporfeandSlaUanta. Eachpolitical 

oommitlce shall maudain eeeoids with leepect to the mattnis cequimd to be reported 

which diall provide in sufficient detail the neoesaaiy infofmation and data fiom which the 

filed reports may be verified, explained, darified, and check fer accumey and 

con^lelenBss. 11 CFR{104.14(bXl). 

A. llfpnrting of Appamit Indqwitwit Fipirolltinei 

1. Facts 

During andit fieldwoik, the Audit staff reviewed disbunemenis to ensure the proper 

reporting of indqtendent expenditures. The Audit staff identified the following: 

• Apparent indq>endent eaqienditures not reported totaling $469,136. 

• VewfornameineoRectiy reported on SdieduicE totaling $185,663. 

Ihe Audit staff was unable to matdi vendor invoioes or payments to aqy 

difounementsdiscloaed on eitfaerSdieduleB(ItemiMdDisbureeaien!s) or Schedule 

E. The AudhstaffaskedCMF to explain how it classified oommnnicatians and how 

it reported foe associated diabunements, as weii as, if aqy documentation was 

available to verify the reported amounts. CMFata^ that portions of some 

difoursements were reported as independent expenditures and the remaining portiona 

as openting expenditures. However, CMF did not caqilain Its mefoodology to 

detennining how the disbursements were disclosed. 

Absent documentation of how diafauiaenients were diacloaed, the Audit staff used the 

following approadi to detennine the amount* that should haw been reported as 

apparent independent eqiendituies: 

4 Ths Audk naff iaelnded fai HI criculrtlon of tht total eoei iUrlbuiBd to IndqMnitoBt npsadbum • 

varioty of other typci of CQrt doBcribed OB the tavoiooi, luch at, portrei offURlbimi ktiH^*;Gorti 

awoeiised wHh cndk GMd proMMiag coiaiaeiKi wUi *ililflilni^ letia^ aid wHh *lMquiiltloB Bd 

piBciBiaia";ch>)rlfdwbitingfcr*inqiilrilioBaiid|anriaiinfl"s'*ianWllirtf;"pnMpactiair;"loridaiK 
n 

• CoimniiniGatiaoflsudiai the tdephone cells, fbllow-uplettm, and tdeviMi 

•dvsrtisGmeiitB contaimiig cxpnss advocacy of a cleariy identified cndidale 

vwreconsideicd to have moat likely diaaemniatBd before the date qf the 

geaefalelectkiiL llCFR§100^a) 

• Baaed on oommiimcationa that the Audit sCaCFdetenidiied were disseiiiiDaled 

before the November 6,2012 geneial decdon, any aaaociatod coata were 

considered independent expendhurea. 

• Baaed on comiminicaliana that the Audit stafTdelennined were diaaeminaled 

after the general election, any aaaociated coats were considered opewtii^ 

cxpendhurea.' 

a. Appelant Independent Eipanditnraa (Copy of Invoice and Cnmainnlration 

MadeAvallabk) 

The Audit Biaff detcnnfaied that CMF made apparent independent expendttuiea 

totaling $1^16390. However, CMF only reported independent expendhurea 

totalbv $1347333- Therefore, the Amtit at^ calculatwl an undeMgnuted 

amount of apparent independent eiqiendituwa totaling $469,136^ for which CMF 

piDvided the aaaocialed comminiicationa which included phone scripts and call 

dates, advertiaemeniB, and solicitation letlen. Una amount inchidea $328350 foat 

CMF has not paid and for which CMF dxMild have disclosed memo entries on 

P MammmKAnmitmA Thc conrespondiiig 

debt owed* also should have been disclosed on Schedule D (Debts and 

ObUgations)^ The phone calls and televisioaadvettiflements contained language 

expressly advocating the election or delhat of a cleariy identified candidate, as 

ddlned under 11 CFRS10032(aX while fiw follow up letlen contained lai^pagB 

advocating foe election or defeat of a cleariy Identified candidate, as defined 

uiideinCFRSI0022(b)7 

NCvioBi,* ind Qcnn mocfalsd wlA cnstfsg nid Medina "pnaduntf* Hch M s ftaig end biBpwaldHi, 

ThsM core dnolbed «Iho invoksi m not dsthied in Icnm of how flay an lekiMlio tho 

hut IIM wiljpi* fi— tmim of th— AtmiU hm M—il 

ooretbrdiDCSsreuiiiaWlBns. SssllCFJLf 100L16. 

' Tho Audit refTreMihinngiefdreiUred on safofaivolco to onfmsic the dre on which CMPs 

vBodoreonpireddieMrviGfli. Iho Audit refftteredtho inn dwroflfaodrenaaeee the dre of 

oonefodon fbrsll iavoiooib ncopt ftrthoie Invoboi In which the dre mae oeciincd ptotly hefiue md 

ptotty oiler the goownlcieeilondiae. InditoGaBBhllieAudltiiiirchoeetoptD-iHtediecotooriheeerviGe 

assiidbig to the pnportiBB of dto dsto nage ooGuniaa belhre md allw dw gawal rieetlon. 

* Oh^$67300 of the Simso would be lequhodtobedhclesrJssdfotrisee CMP dhehiBBddcht owed 

tothiivendortotoBngS2MA5000hs2012yew end wpuiL SeeFladhigd-RflpartlnaorDfotiad 

OMIairione, p.13. 

' CMF huindiQatedtiwt the two teiepiioneeGripni two fbliDW-opletten» sad three totevieion 

edvertirementi in the Audit etairepQweeelnniepwMnt the retirouniwneofconnnunloetienethet were 

Otode during the iudit period. However, taeoieee inrlicelu there wue ea eddttjoael 2 televieieB 

•lwHliemepiB,eBBFiadlng5-ltccQniirephiihrCenununicedane,p. 14. BeeedontheconuntofdiB 

ooeanunietoiBBi, one tehiiiione ecript, one idloiMip letter, end two tdevfeioB edwHlwineuii MnSeiieil 
12 

k lndapcBdwt Eipcadttmai Rapwled om. Schcdak E (IndapudcBt 

Eipndttnn Schedule) - Mdoim Enrm 

CMFdiecloaedSi independent expeni&tune totaling $185,663 with en inoonect 

vendorname. Theeecapcndftnica^iBiediicioeedaepeid to die media vendor. 

However. CMF did not make dirertpqnneatB to diis vendor. Hie media vendor'i 

aeivioei were billed to CMF through invDices flom another vendor, and CMF 

made direct peymenti to that vendor hiatead of the media vendor. 

2. iBleita Andit Report A AndltlMvUoniieeoinnMndalion 

At die exit conference^ die Anffitrtaffpwacntedadiedulea of atniaienl independent 

expenditure iqiortlngeiroira. In leiponae to the exit conference^ the CMFTtoaiurer 

provided an email addrening S301,972 of the espenaes billed but not paid in eecdoQ 

A.l(a)dbove. HwemaildiowedthatJune2012expenseitotaling$92^411 thatvm 

billed to CMF were actually iocvred by another commitlBe nod dxnild have been 

paid by that uwumittnr.' Other than the email provided by CMF, the CMFTiineiii in 

hmm iwit Miy ntW Aw^rniiiitinw to thmt thm 5. 

liaUefer $92^11. 

HIB Audit staff recommenda that, within 30 calendar d^ of the ecfvice of this 

report, CMF; 

• Provide documentation and evidenee that qipaientindepeadeateKpeadiluies 

totaling $469,136 did not require reporting as independent expenditunB. 

Abaent such evidence^ the Audh ati^ leoommends tint CMF ameod its 

lepoitB to disclose thne diriMiaemeatB as independent expenditures on 

Schedule E and submit seviaed procedures for iqxnting irxiependent 

expenditures. 

e Amend its reports to cofiect the vendor name for the 31 independent 

eaqicnditures totalmg $183,663. 

& Failnre to nieldW-Henr Reports tor Independent Expendhnres 

1. Fhels 

During audit fieldwoik, the Audit staff reviewed disbursements to delennine whether 

24/48-hourieportB were properly filed.* The Audit staff determined that CMF filed 

UDtimdy 24-hour reports fbr 13 independent expendfoiieB totalmg $90^60. Forthese 

expenditures, 24-hour reports were fiM 13 to 27 days after the diaaendnstion date. 

As noted above^ the Audit staff also Identified apparent independent eiqiendituies 

totaling $469,136 wUch may also require filing of24/48-hourrepoit8. 

' TIMIISIMI MMiMiiSSwilinl CMTiiiwiMiilr li IMiliiflw llMiirTjIil (MS hniS iminiiol wlilillBi 

CoeoBinloiL 

* SeefeoteoteS, 
13 

2. lolwim Audit HeperlAAEdbDMrisBlleeoMKBdHlloB 

At llie exit eonicRooe^ tbe Audit itaff picMDtcd ichcdiiles of untunely and ponible 

24/4d-houriqxictsdiBt wen not filed. TlieCMFTteaauierhBdiiOBdditional 

cammcnts. 

$469,136 did not lequfae leportiiig aa indqmdGDt expeoditum (per aectkm A. 1.(a) 

aboveX Ae Audit atafrieoammendB diat, within 30 calendar days of service of ddi 

icpoit, CMF provide documenlation to support the date of public diasemination for 

the comnnmications to detenuiue uAether a filiiv of a 24/4$-hour report was 

required. Tiwi AnAif i^fT wjaonimBiils ****** pwwfiiU 

denionstnte diat die 24-lKMiriqxxta totaling $90^260 were filed timely. 

|fladfaig4, ItoportiagofPahtoMdOWiartioM 

During audit fieldwDik, the Audh staff identified debts totaling $67,800 that were not 

disclosed on Schedule D (Debts and Obligations) as required. CMF contends that it was 

not liable fiir a portion oftbee^qieiises, as tli^ were incunnd by another conmihtee. The 

Audit staff RGoomieDds tbaX absent documentation demonstiatiqg that these 

expenditures did not require reporting on Schedule D, CMF amend its reports to disclose 

these debts. 

A. roalMimui Bmaitjagniiqalml A pftHtkal eMnmttiag disrJffBff dir amfflint 

and nature of outstandiiig debts and obligsticas until those debts are extiivuishBd. 

32U.S.C. S30104(bX8)and 11CFR 5S10A3(d)andl04.11(aX 

& liearixisg Debts and OHgations. 

• A debt of$500 or less nuBt be lepurted once it has been outstanding 60 dqrsfiam 

the date incurred (the date of the tiansactionX the committer reports it on the next 

xegulariy scheduled report 

• A tMitcxceediiig $500 must be disclosed in the report that coven the date on 

which the debt was incurred. 11 CFR §104.11(b). 

A. Flaets 

The Audit staff reviewed invoices and disclosure reports for proper reporting of debts and 

cbUgatioiis. During the electkxi cycle, CMF ovcKeported debt owed to one vendor 

excqit fin the 2012 Year-End Report, which did not include $67,800"* owed to the 

vendor. This vendor provided media services fhr CMF. 

TinAudilUifridBBdlledpqnnnlioiiMdtoIhbwoilortolilliig8328,250. See Ffadtag 3-Kcpoittagof 

App—itlBdepeodenlBiqMiMllUsw,p.l. OBlySd7JOOoftbBS32A2SOwDuldbsnqiiMlDbe 

rifirlmnrt •• iWit rinm nUF dhrlnarrt dnht rrnntl m flih wirinr mrtlhu |7«ljt1C mi In 7017 ym mil 
14 

B. iBterin Andit Report A Audit Diviikin RMOfflHcadatIra 

At the exit ooDftrence* the Audit staff provided a schedule and diflcussod die debt 

tepoiting matter vnth the CMF Treasurer. In le^xuise to the exit conference, the CMF 

lYeasurer provided an email diowmg that June 2012 expenses totaling $92,411 that were 

hilled to OdF were actually incurred by another committee and should have been paid by 

that committee. However, no further documentation or explanation has been provided to 

thM fngpgnacB with annrtwir rjmtmitimm The AuAt Staff hSS UOt been able tO 

verify that the othre committee is actually liable for the debt. As a result, the debt that 

CIdF has not reported on its Schedule D remains as $67,800. 

The Audit staff recommends that, within 30 calendar days of service of this report, CMF: 

• Provide documentation demonstrating that these expenditures did not require 

reporting on Schedule D. 

• Provide documentation to support that the expenses totaling $92,411 were billed 

erroneously to CMF. 

• Absent sui^ documentation, the Audit staff recommends that CMF amend its 

reports to disclose the unreported debts totaling $67,800. 

I Findiii£ s. RecoidkaepiiiK tor | 

Buuutfy 

During audit fieldwork, the Audit staff reviewed disbursements to verify the accuracy of 

the infbimation and proper classification of transactions disclosed on reports. TheAudit 

ataffidentified $304,399 fiv which sufficient records were not provided. Withoutacopy 

of the invoices and the associated communications, (he Audit staff is unable to detennine 

how CMF should have reported fliese disbursements. The Audit staff recommends that 

CMF provide, in sufficient detail, the necessary information from which the 

disbunements totaling $304,399 may be verified or explained. Such recoida dxnild 

include copies of invoices and identification of the associated communication, and, if flie 

communication has already been provided, information associating each communication 

with an invoiceCs). 

htfflBtmdaxd 

A. Formal Requirements Ragarding Reporti and StateuMnti. Each political 

committer shall mainUdn records with respect to the matters required to be lepmled 

wdtich shall provide in sufficient detail (he necessary InfbnnatiQn and data torn which 

the filed reports may be verified, explained, darified, and check for accuracy and 

completeness. II CFR§104.14^X1)-

npoiL CMP GontenditfHtinvoiGei totaling 192^11 of the 8328,250 billed wweincuired by nodMr 

committee. 
15 

B. PrwrviegReeenbaedCopkief Reports, The treasurer of a politkdooniinhtee 

must preserve all records and copiei of repoiti for 3 yean after tin npoit is filed. 32 

U.S.C. S30102(d). 

Iteti ud AaalfolB 

A. Facts 

During audit fieldwoik, tbe Audit staff reviewed disbunements to verify the accuncy of 

the infimnation reported on the disdoiure reports. 

The Audit slaff*s analysis resuhed in the fidlowing; 

CMF made two disbunements to a madia vendortotaling $79^ 1" for which 

documendatioD was insufficient to make a determinalion of how these 

disbursements should be reported. Available documentatiaa included foe 

dMnnsement database, canceleddiBckcopica, and bank statements. Wittiouta 

copy of the invoioes and the associated communicatians, the Audit staff Is unable 

to detennine how CMP rinuld have reported these disbursements. TheAudit 

staffrequerted the invoices, payment documentation, and copies of the 

communications. 

DidwnemeiitB totaling $224,768 for tdeviskm advertisemeots were paid to one 

mediavsndor. Incomidete copies ofthe communication were made available to 

theAuditstafif CMP provided the invoices fbrtheaedidMisements; however, 

without a conqdete copy ofthe communication the Audit staff is unable to ve^ 

CMP's reporting of fiieae costs. The Audit staffrequested copies of the 

asffOffiatiTft 

B. Interim Andit Report dk Audit DMslanRseoniiHendatlon 

At the exit conference, the Audit staff presented a schedule of the disbursements fin 

which further records were necessary. The CMP Treasnrer did not provide ai^ 

comments. 

The Audh staff recommends that, within 30 calendar days of service of this iqxnt, CMP 

provide die necessaiy records so the Audit staffcan determine the proper reporting fiir 

the dubursemenla totaling $304399 ($79,631 + $224,768) on die recommended 

amendments. Such records should include: 

• Hnpiea nf imiiiMM and iHgnrificafinw «f mmanmrn^ ftmrnmimiwarinw tmA 

• If the communication has already been provided, information associating each 

communieation wKh an invoioe(s). 

" Riii sinount h s pat of the sxpendiaaM not nportsd which h addtvaod is FMhig 1 - Mi 

PtasneU Aedviqp, p. S. 

of