Draft Final Audit Report of the 

Audit Division on the Oklahoma 

Democratic Party^ 

(January 1, 2011 - December 31, 2012) 

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, prohibit 

disclosure requirements 

the Act. 

Fut^KAcI -iiii 

The^^a^ion may 

initiate an^focement 

action, at a^^^e, with 

respect to any o^^iatten 

discussed in this^^^ 4 

About the Committee (p. 2) 

The Oklahoma Democratic Party is a^te party committee 

headquartered in Oklahoma City, For more information, 

see the chart on Committee Oi ition, p. 2. 

Financial 

• Receipts 

o ContriM 

o Contributio 

Committees 

o transfers from 

littees 

o 

o Ti 

)ther 

iditures 

Affiliated/Other Party 

o t'&JWSl Election Activity 

Other Disbursements 

Disbursements 

Levin Receipts 

Levin Disbursements 

S 232,651 

144,946 

289,642 

416 

119,124 

$806,779 

$803,118 

7,000 

17,219 

350 

$827,687 

$54,222 

$63,754 

Findings and Recommendations (p. 4) 

• Misstatement of Financial Activity (Finding 1) 

• Misstatement of Financial Activity - Levin Fund (Finding 2) 

• Reporting of Debts and Obligations (Finding 3) 

• Recordkeeping for Employees (Finding 4) 

' On May 18,2011, the Commission received a Statement of Organization from the Democratic Party of 

Oklahoma officially changing its name to Oklahoma Democratic Party. 

' 52 U.S.C. §30111(b). 
Draft Final Audit Report of the 

Audit Division on the 

Oklahoma Democratic Party 

(January 1, 2011 - December 31, 2012) 

r 
Table of Contents Pag® 

Parti. Background 

Authority for Audit 

Scope of Audit 

Commission Guidance 

PMtW. 

Finding 1. of Fina^ial Activity-1 

-

Finding 4. - -

1 

1 

1 

2 

3 

8 

11 

12 
Parti 

Background 

Authority for Audit 

This report is based on an audit of the Oklahoma Democratic Party (GDP), 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 52 U.S.C. §30111(b), which permits the 

Commission to conduct audits and field investigations of any political committee that is 

required to file a report under 52 U.S.C. §30104. Prior to conduc^g any audit under this 

subsection, the Commission must perform an internal review filed by selected 

conunittees to determine if the reports filed by a particular c^^ittee meet the threshold 

requirements for substantial compliance with the Act. 5 11(b)-

Scope of Audit ^ ^ 

Following Commission-approved procedures, the^^» otaff evaluat> 

factors and as a result, this audit examined: 

1. the disclosure of individual contributors' 1 ^on 

2. the disclosure of disbursements, debts and obli^ 

3. the disclosure of expenses allocated between fedi 

srisk 

accounts; 

of em] 

ederal, and Levin 

4. the consistency between reported 1 

5. the completeness of records; and 

6. other committee operations necessary 

Commission Ciii'il tu^ 

nkrei 

Request for Early • 

Pursuant to the Cc 

Consic 

unaffil^S^ with i 

audita^^erine the 20l 

monthl^^ logs under' 

percent fi ^ >nds. 

lissioj 'onsiderati(^^ a Legal Question 

Establishing a Program for Requesting 

ission," several state party committees 

y consideration of a legal question raised during 

Specifically, the Commission addressed whether 

•7(d)(1) were required for employees paid with 100 

The Commis lude . ^y a vote of 5-1, that 11 CFR § 106.7(d)(1) does require 

committees to kei ^^ly log for employees paid exclusively wi& federal fiinds. 

Exercising its prosecp^al discretion, however, Ihe Commission decided it will not 

pursue recordkeeping violations for the failure to keep time logs or to provide affidavits 

to account for employee salaries paid with 100 percent federal funds and reported as 

such. The Audit staff informed ODP representatives of the payroll log requirement and 

of the Commission's decision not to pursue recordkeeping violations for failure to keep 

payroll logs for salaries paid and correctly reported as 100 percent federal. This audit 

report does not include any findings or recommendations with respect to ODP employees 

paid with 100 percent federal funds and reported as such. 
Partn 

Overview of Committee 

Committee Organization 

Important Dates 

• Date of Registration October 9.1984^^ 

• Audit Coverage January 1,20]^December 31,2012 

Headquarters Oklahoma }ma 

Bank Information 

• Bank Depositories 

• Bank Accounts Fed»al; One 1 1; One 

Treasurer F ^ 

• Treasurer When Audit Was Conducted D &^11 

• Treasurer During Period Covered by** Donna May 14,2011 - Present 

,inda Gra , March 20,2008 -

1 2ui 

Management Information % 

10 

• Attended Commission " Finance'^ 

Seminar ^ 

w vo 

I * 

• Who Handled Ac^ ; and'^ ^ 

Recordkeeping T^ 

^aid Staff 
Overview of Financial Activity 

(Audited Amounts) 

Cash-on-hand ® January 1,2011 $28,041 

Receipts 

o Contributions from Individuals 252,651 

o Contributions from Political Conunittees 144,946 

o Transfers from Affiliated/Other Party 

Committees 

289,642 

o Offsets to Operating Expenditures ^ ^416 

o Transfers from Non-federal & Levin Funds A -119,124 

Total Receipts W 779 

Disbursements A 

o Operating Expenditures 

o Transfers to Affiliated/Other Party 

Committees V . 

o Federal Election Activity 17,219-r 

o Other 

Total Disbursements s /,o»/ 

Cash-on-hand @ December 31,2012 

Levin Cash-on-hand @ January 1,2011 

Total Levin Receipts 

Total Levin Disburse s 

Levin Cash-on-ham 

S 7,133 
Part 111 

Summaries 

Findings and Recommendations 

Finding 1. Misstatement of Financial Activity 

During audit fieldwork, a comparison of ODP's reported financial activity with bank 

records revealed a misstatement for the beginning cash balance in 2011 and receipts and 

disbursements in 2011 and 2012. Beginning cash on January 1.2fl^. was understated by 

$7,537. For 2011, ODP understated its receipts by $6,977 an^pdislbursements by 

$12,759. In 2012, ODP understated its receipts by $12,88^^^^ disbursements by 

$ 10,450. Subsequent to the exit conference, ODP amen^^tsm which materially 

corrected the misstatements for 2011, but not for 20 IZ^l^espori j^e Interim Audit 

Report recommendation, ODP filed amended discl^^re^eports that HT ally corrected 

the misstatements for 2012. 

(For more detail, see p. 6.) 

Finding 2. Misstatement of Finan^-1 \ctivit7 - Levin 

Fund 

During audit fieldwork, a comparisoi ^ T' 

revealed a misstatement of its cash 

2012 Levin activity. For 2011, ODP unc 

Levin disbursements b The begir 

2011 was also undc , 705. In 201 

$31,000 and its L^ sburse^^tsby $15,4 

overstated by $3,98 I ' Tnt 

filed amen< ; hi 

ivity with bank records 

lents for 2011 and 

iipts by $6,015 and its 

/cash b : for the Levin account in 

ODP understated its Levin receipts by 

ending cash balance for 2012 was 

Cudit Report recommendation, ODP 

did not materially correct the Levin 

(For detail, s( 

Findid 

During au 

obligations o 

Obligations). Su 

correctly disclosed 

Repiii ijpg df Debts and Obligations 

" .udit staff determined that ODP failed to report debts and 

totaling $56,387 on Schedule D (Debts and 

the exit conference, ODP amended its reports which 

53 in debts and obligations previously not reported on Schedule 

^e ve 

D. In response to the Interim Audit Report recoirunendation, ODP filed amended 

disclosure reports that materially corrected the debt reported on Schedule D. 

(For more detail, see p. 11.) 

Finding 4. Recordkeeping for Employees 

During audit fieldwork, the Audit staff determined that ODP did not maintain any 

monthly payroll logs, as required, to document the percentage of time each employee 

spent in connection with a federal election. For 2011 and 2012, the Audit staff originally 

identified payments to ODP employees totaling $201,551, for which ODP did not 

maintain monthly payroll logs. This consisted of payroll which was allocated with 

federal and non-federal fimds. There was no payroll paid exclusively with non-federal 
funds. Subsequent to the exit conference, ODP amended its reports to disclose $79,437 

of the employees salaries, previously reported as allocated expenses, as 100 percent 

federal expenses. 

The Audit staff verified the change in ODP's amended reports, and in light of the 

Commission's guidance with respect to recordkeeping for employees paid with 100 

percent federal funds and reported as such, the Audit staff concluded that no further 

action was necessary with respect to recor^eeping for the $79,437 in employees salaries. 

In response to the Interim Audit Report recommendation, ODP amended its reports to 

disclose $111,603 of the employees salaries, previously reported as allocated expenses, as 

100 percent federal expenses. The Audit st^ could not identi^l^maining employee 

salaries totaling $10,511 ($201,551 - $79,437 - $111,603) o^gWended reports. ODP 

also stated it has implemented procedures to ensure that iie maintained for 

any employee who is paid in whole, or in part, with non-^jPera s. ODP complied 

with the Interim Audit Report recommen^tion by irg^nTOting > maintain 

payroll logs in the future. 

(For more detail, see p. 12.) 

A 

r 
Part IV 

Findings and Recommendations 

Finding 1. Misstatement of Financial Activity 

Summary 

During audit fieldwork, a comparison of OOP's reported financial activity with bank 

records, revealed a misstatement for the beginning cash balance in 2011 and receipts and 

disbursements in 2011 and 2012. Beginning cash on January 1,2011, was understated by 

S7,S37. For 2011, GDP understated its receipts by $6,977 and it^^bursements by 

$12,759. In 2012, GDP understated its receipts by $12,8891 

$10,450. Subsequent to the exit conference, GDP; 

corrected the misstatements for 2011 but not for 2012. 

Report recommendation, GDP filed amended disclo 3rts t 

the misstatements for 2012. M 

•ursements by 

which materially 

the Interim Audit 

•rially corrected 

Legal Standard 

Contents of Reports. Each report must disclose ^ 

• the amount of cash-on-hand at the beginning ant f the reporting period; 

• the total amount of receipts for thIlSaeDorting period Igii^r the calendar year; 

• the total amount of disbursements tingpe^ for the calendar year; 

and 

• certain transactions that require itemil ioti ^^^^^(Itemized Receipts) or 

Schedule B (Itemii ments). J^^.S.C. (2), (3), (4) and (5). 

Facts and 

:recoi 

I cash balai 

Lthe discn 

paraj 

lit! iciled GDP's reported fmancial activity 

2P1^. The reconciliation identified that GDP 

for 2011 and 2012. The following 

GDP's disclosure reports and its bank records, 

explain why these discrepancies occurred. 

2011 CommitteiS^ / 

Reported Bank Records Discrepancy 

Beginning Cash Bal«^ce @ 

January 1,2011 

$20,504 $28,041 $7,537 

Understated 

Receipts $305,062 $312,039 $6,977 

Understated 

Disbursements $310,126 $322,885 $12,759 

Understated 

Ending Cash Balance @ 

December 31,2011 

$15,490" $17,195 $1,705 

Understated 

^ ODP miscalculated its ending cash balance by reporting a beginning cash balance in one report different 

than the ending cash balance of the previous report. This created a mathematical discrepancy of $50. 
The beginning cash balance was understated by $7,537 and is unexplained but likely 

resulted fix)ni prior period discrepancies. 

The understatement of receipts resulted from the following: 

• Contributions from individuals not r^orted 

• Transfers from Levin/Non-federal accounts not reported 

and amount incorrectly rq)orted 

• Reported contributions from individuals not supported by 

deposit 

Net Understatement of Receipts 

+ 

+ 

$1,765 

5,602 

390 

186.977 

The understatement of disbursements resulted from the folio 

• Bank fees, other disbursements and cash withdrawii 

• Payments for insurance, event expenses, phone, 

financial services, and taxes not reported ^ 

• Payments for salaries and wages 

• Contribution refunds not reported 

• Reported payments for taxes, consult£^ ion 

and other disbursements not supported b} 

Net Understatement of Disbursements 

ported + $2,443 

+ 

+ 

6,740 

1,591 

5,010 

ices, 

it ^ 3.025 

+ <812.759 

The $ 1,705 understatement of the eni 

described above. 

iilance r I n the misstatements 

2012 Committee Activii 

Beginning Cash I 

January 1,2012 

(k 

Receipts 

Ending Balance ( 

December^ ' 

;.eported^ 1 BankRicords Discrepancy 

1 $15.49^ L $17,195 

> 

$1,705 

Understated 

$494,740 $12,889 

Understated 

. $494,352 $504,802 $10,450 

Understated 

^$3,61Qr $7,133 $3,463 

Understated 

Theundersta ' s resulted from the following: 

• Contributio individuals not reported 

• Transfers froi^Non-federal account not reported 

• Reported offsets not supported by deposit 

• Unexplained differences 

Net Understatement of Receipts 

The understatement of disbursements resulted from the following: 

• Bank fees and credit card payments not reported 

+ 

+ 

$5,387 

13,135 

6,005 

372 

$4,112 

* ODP miscalculated its ending cash balance by reporting a beginning cash balance in one report different 

than the ending cash balance of the previous report. This created a mathematical discrepancy of $681. 
8 

Payments for rent, insurance, event expenses, telephone services, 

taxes and other disbursements not reported 

Payments for salaries & wages not reported 

Contribution to a political party and travel reimbursement 

not r^rted 

Transfer to Non-federal account not rq)orted 

Reported bank fees, credit card and tax payments not supported 

by a check or debit 

Reported payment for salaries and wages not supported by a 

check or debit 

Reported payments for office supplies, shipping, telept 

consulting services, and other disbursements not si 

a check or debit 

Net Understatement of Disbursements 

The $3,463 understatement of the ending cash balaj^^idted 

+ 15,494 

+ 6,272 

+ 2,180 

+ 500 

- 5,495 

- 1,442 

11.171 

S10.450 

sstatements 

described above. 

B. Interim Audit Report & Audit Division 

The Audit staff discussed the misstatements with 01 

conference. ODPrepresentativessta^thatthey 

review each issue. The Audit staff pra^^^^rlq)apers 

financial activity to ODP lepresentativ^pPw^fi^xit 

conference, ODP filed amended reports &t nu 

2011. For 2012, ODP filed amended 

activity. The amende^ I not precil|^ this 

the amendments w „ _.he notificalm of the audit. 

Ives at the exit 

after having time to 

1 misstatements of 

Subsequent to the exit 

its financial activity for 

rially correct its financial 

the audit report because 

The Interim Audit Rep 

the remai 

recdl^^^ tiding ca& 

subseque pancies 

' amend its disclosure reports to correct 

12, and adjust the cash-on-hand balance 

, noting that the adjustment is the result of prior-

^udit Report further recommended that ODP 

-handj^ance of its most recent report to identify any 

^ may affect the recommended adjustment. 

C. Committee''S^|ions^^ Interim Audit Report 

In response to the^^^^udit Report recommendation, ODP filed amended disclosure 

reports for 2011 and^il2 that materially corrected the misstatements. 

Finding 2. Misstatement of Financial Activity - Levin 

Fund 

Summary 

During audit fieldwork, a comparison of ODP's reported Levin activity with bank records 

revealed a misstatement of its cash balance, receipts and disbursements for 2011 and 

2012 Levin activity. For 2011, ODP understated its Levin receipts by $6,015 and its 

Levin disbursements by $8,624. The beginning cash balance for the Levin account in 
2011 was also understated by $S,70S. In 2012, ODP understated its Levin receipts by 

$31,000 and its Levin disbursements by $15,422. The ending cash balance for 2012 was 

overstated by $3,984. In response to the Interim Audit Report recommendation, ODP 

filed amend^ reports; however, the amended reports did not materially correct the Levin 

misstatements. 

Legal Standard 

Contents of Levin Reports. Each report must disclose: 

• The amount of cash-on-hand for Levin funds at the beginning and end of the 

reporting period; 

• The total amount of Levin fund receipts and disbursements (including allocation 

transfers) for the reporting period and for the calendar year: ^ 

• Certain transactions that require itemization on Schedul^ ^ (Itemized Receipts of 

Levin Funds) or Schedule L-B (Itemized Disburseme^^ i Funds). 11 CFR 

§300.36 (b)(2)(B). 

Facts and Analysis 

A. Facts 

As part of the audit fieldwork, the Audit staff recoil reported L^n fund 

financial activity vdth its Levin bank^cords for 2011 ,^2012. The reconciliation 

identified that ODP misstated its casl^ 3, receipts^^^bursements for 2011 and 

2012. The following charts outline thi betw^^^P disclosure reports 

and its Levin bank records, and the succ^in^ s ex^un why these 

discrepancies occurred. » 

2011 Committee 1 

Beginning Cash Balan^^ 

January 1, 

Ending Cash^ 

ne!Pj»Tnh#»r 1 

iteported Records Discrepancy 

10 

"-"17,207 

•f 

W $10,705 $5,705 

Understated 

10 

"-"17,207 

•f 

$23,222 $6,015 

Understated 

20,583 $29,207 $8,624 

Understated 

$4,720' $4,720 $0 

The beginning cash ^ance was understated by $5,705 and is unexplained but likely 

resulted from prior period discrepancies. 

The understatement of receipts resulted firom the following: 

• Transfer from a Federal account not reported 

• Contribution from an individual not reported 

Understatement of Levin-funds Receipts 

+ 

+ 

$1,015 

5,000 

Mm 

' ODP miscalculated its ending cash balance by reporting a beginning cash balance in one report different 

than the ending cash balance of the previous report. This created a mathematical discrepancy of $3,096. 
10 

The understatement of disbursements resulted from the following: 

• Transfer to a Federal account not reported 

• Transfer to the Non-federal account not reported 

• Payment to a vendor not reported 

Understatement of Levin-funds Disbursements 

+ 

+ 

+ 

$5,600 

2,009 

1,015 

2012 Committee Levin Activity 

Reported Bank Records Discrepancy 

Beginning Cash Balance @ 

January 1,2012 

$4,720 $4,720 $0 

Receipts $0 $31,000 

ASM 

$31,000 

t Understated 

Disbursements $19,125 $34 $15,422 

Understated 

Ending Cash Balance @ 

December 31,2012 

$5,157" ^51^173 $3,984 

Overstated 

The understatement of receipts resulted fromj 

• Contributions from individuals not report 

• Receipt not reported 

Understatement of Levin-fu^ -eceipts 

$30,000 

+ 1.000 

+ mm 

The understatement of disbursements 

• Payments for event expenses and 

• Transfers to a Ft ^unt not 

• Rq)orted 

not su] 

• Reported pa; 

not supported by 

e folio 

rv 

+ 

+ 

reportei vice and 

debit 

reported 

$10,015 

14,969 

4,562 

5,000 

$15.422 

iverstateii he i^cash balance resulted from the misstatements 

B. Interim A^^Repoi % Audit Division Recommendation 

The Audit stafF^^^sed^e Levin fund misstatements with ODP representatives at the 

exit conference. Cn^p^^sentatives stated that they would respond after haying time to 

review each issue. Audit staff provided workpapers detailing the misstatements of 

Levin fund financial activity to ODP representatives after the exit conference. 

The Interim Audit Report recommended that ODP amend its disclosure reports to correct 

the Levin misstatements noted above, and adjust the Levin cash balance as necessary on 

its most recent report, noting that the adjustment is the result of prior-period audit 

adjustments. The Interim Audit Report further recommended that ODP reconcile the 

' ODP miscalculated its ending cash balance by reporting a beginning cash balance in one report different 

than the ending cash balance of the previous report. This created a mathematical discrepancy of $19,562. 
11 

Levin cash balance on its most recent report to identify any subsequent discrepancies that 

could affect the recommended adjustment. 

C. Committee Response to Interim Audit Report 

In response to the Interim Audit Report recommendation, ODP filed amended disclosure 

reports; however, ODP did not materially correct any Levin activity. The amended 

disclosure reports only included Schedule L (Aggregation Page: Levin Funds) with zero 

balances. ODP did not file any Schedule L-A (Itemized Receipts of Levin Funds) or 

Schedule L-B (Itemized Disbursements of Levin Funds), as required to correct the Levin 

misstatements. As such, ODP did not fiilly comply with the Interim Audit Report 

recommendation. 

Finding 3. Reporting of Debts and Ob, 

Summary ^ 

During audit fieldwork, the Audit staff determiM^iat 

obligations owed to five vendors totaling Si 

Obligations). Subsequent to the exit conferencf. 

correctly disclosed $17,953 in debts and obligation 

D. In response to the Interim Audit 

iiii^ 

ODP failed to rt^i sbts and 

e D (Debts ^ 

^ its repor ich 

%s\y not reported on Schedule 

DDP filed amended 

disclosure reports that materially i 

Legal Standard 

A. Continuous Reportin|L^quired. A 

and nature of outstai 

lebt repoi ledule D. 

52U.S.C.§30104(K fon 

104.11(a). ^ 

B. Itemizi TI 

be reportec 

oeedin^ 

incurre« 

Facts and 

obligatii 

U.S.C. § 

must disclose the amount 

until thq^ debts are extinguished. 

4(b)(8)), 11 CFR §§104.3(d) and 

days from the date incurred, a debt of $500 or less 

-ly scheduled report. 

osed in the report that covers the date on which 

§104.11(b). 

A. Facts 

During audit fieldwork, the Audit staff reviewed disbursement records and disclosure 

reports for proper reporting of debts and obligations. This review identified debts owed 

to five vendors totaling $56,387^ that ODP failed to report on Schedule D. Of these 

debts, $24,848 was owed to a credit card company; $17,953 was owed to two vendors 

relative to catering charges for a single event; $7,188 was owed to a printing company; 

and $6,398 was owed for the rental of a facility for an event in April 2012. These debts 

were outstanding for a range of 45 to 227 days firom invoice to payment date. As of 

^ Each debt in this amount was counted once, even if it required disclosure over multiple periods. In order 

for ODP to correctly file amended reports, schedules were provided that included the amount of each debt 

required to be reported for each reporting period. 
12 

December 31,2012, $24,708 of this debt remained outstanding. ODP did not report any 

debt on Schedule D during the audit period. 

B. Interim Audit Report & Audit Division Recommendation 

The Audit staff discussed the reporting of debts and obligations with ODP representatives 

and provided schedules detailing the transactions requiring disclosure. ODP 

representatives had no comments on this matter. Subsequent to the exit conference, ODP 

filed amended reports to correctly disclose $17,953 in debts and obligations on Schedule 

D; thus leaving $38,434 to be itemized on Schedule D. The amended reports did not 

preclude this matter from the audit report because the amendments were filed after 

notification of the audit. 

The Interim Audit Report recommended that ODP provide i lentalion demonstrating 

that the remaining $38,434 in debts and obligations disc did not require 

reporting on Schedule D. 

C. Committee Response to Interim Audit Repj 

In response to the Interim Audit Report recoi 

reports that materially corrected the commitb 

ODP reported a total of $43,490 of the $56,387 in 

DP filed ami 

debts and ob! 

gations on 

Finding 4. Recordkeepiii 

Summary 

During audit fleldwor^ 

monthly payroll lo eqi 

spent in connectiol 

identified payments to 

maintain inffl^^^|8yroll 

federal s7 

b it c 

of 1 ;es salarie 

federal ei 

odoci 

lection. 

liliiVri-

^the percentage of time each employee 

1 and 2012, the Audit staff originally 

01,551, for which ODP did not 

bf payroll which was allocated with 

: was no payroll paid exclusively with non-federal 

ODP amended its reports to disclose $79,437 

as allocated expenses, as 100 percent 

The Audit si ^6hange in ODP's amended reports, and in light of the 

Commission's gu^^^mth respect to recordkeeping for employees paid with 100 

percent federal fiind^M report^ as such, the Audit staff concluded that no further 

action was necessary with respect to recordkeeping for the $79,437 in employees salaries. 

In response to the Interim Audit Report recoimnendation, ODP amended its reports to 

disclose $111,603 of the employees salaries, previously r^orted as allocated expenses, as 

100 percent f^eral expenses. The Audit staff could not identify the remaining 

employees salaries totting $10,511 ($201,551 - $79,437 - $111,603) on the amended 

reports. ODP also stated it has implemented procedures to ensure that time sheets are 

maintained for any employee who is paid in whole, or in part, with non-federal funds. 

ODP has complied with the Interim Audit Report recommendation by implementing a 

plan to maintain payroll logs in the future. 
13 

Legal Standard 

Maintenance of Monthly Logs. Party committees must keep a monthly log of the 

percentage of time each employee spends in connection with a federal election. 

Allocations of salaries, wages, and j^nge benefits are to be undertaken as follows: 

• employees who spend 25 percent or less of their compensated time in a given 

month on federal election activities must be paid either j&om the federal account 

or be allocated as administrative costs; 

• employees who spend more than 25 percent of their compensated time in a given 

month on federal election activities must be paid only from a federal account; and, 

• employees who spend none of their compensated time in a given month on federal 

election activities may be paid entirely with funds that coi^ly with state law. 11 

CFR§106.7(dXl). 

Facts and Analysis 

A. Facts 

During audit fieldwork, the Audit staff reviewed^ 

maintain any monthly payroll logs or equivalc 

time each employee spent in connection withfa 

to document the proper allocation of federal and nol 

salaries and wages. For 2011 and 20^, ODP did not 

$201,551'in payroll.^ This amount in layrollfor 

Schedule H4 (Payments for Allocable 

and non-federal funds during the same 

with non-federal funds. 

lents for oa^m^ ODP did not 

the p ' rtage of 

These log! required 

used to ]^y employee 

ly nudntain monthly logs for 

initially reported on 

^location of federal 

3 no J roll paid exclusively 

31 

nsi\ 

B. Interim Audit 

The Audit staff 

during the audit field 

questions ' 

issue. 

payn lenditure' 

insts'. 3ral activi^ 

correct i igr by comj 

expenditure^^^ctly fe 

amended repo^^^ ':i 

Election Activity 

Schedule H4. Tli 

federal account to cd^er the $79,437 now reported as 100 percent federal election 

activity. As such, no further action was recommended wifii respect to the payroll totaling 

$79,437 paid with 100 percent federal funds.'° The amended reports did not preclude this 

' This amount includes unreported salary payments totaling. $7,172 to employees that also received other 

salary payments during the audit period that were reported on Schedule H4. This amount is $1,111 

higher than the $200,440 salary presented in LRA 978 due to calculations based on salary transactions 

reported on Schedule H4 rather than salary transactions in ODP's database. 

' This total does not include payroll for employees paid with 100 percent federal funds and reported as 

such (see Part I, Background, Commission Guidimce, Request for Early Commission Consideration of a 

Legal Question, Page 1). Payroll amounts are stated net of taxes and ^ge benefits. 

See Part I, Bacl^und, Commission Guidance, Request for Early Commission Consideration of a Legal 

Question, Page 1. 

ommendation 

sment with ODP representatives 

onfe -e. ODP representatives asked 

fflM^spond after having time to review this 

snceT^P representatives responded that these 

irted as shared federal/non-federal activity, 

, ODP representatives stated that they plan to 

ly amending ODP's reports and disclosing these 

1 activity. Subsequent to the exit conference, ODP filed 

79,437 in payroll on Schedule B, Line 30b (Federal 

^rely with Federal Funds); thus, leaving $122,114 still on 

staff verified that ODP h^ not made the transfers fixim its non-
14 

matter from the audit report because the amendments were filed after notification of the 

audit. 

The Interim Audit Report recommended that ODP provide evidence that it maintained 

monthly time logs to document the percentage of time an employee spent in connection 

with a federal election; or implement a plan to maintain monthly payroll logs in the future 

for the remaining $122,114 in payroll reported on Schedule H4. 

C. Committee Response to Interim Audit Report 

In response to the Interim Audit Report recommendation, ODP filed amended reports 

disclosing $111,603 in employees salaries, previously reported as allocated, on Schedule 

B as ICQ percent federal expenses. ODP's amended reports do mpHl^close the remaining 

$10,511(S201,SS1 - $79,437 - $111,603) in salaries. This an^t incudes unreported 

salaries totaling $6,272 for calendar year 2012 from Find^#^ ^e 6, and $4,239 in 

employee salaries Aat was previously reported on SchedH^H4 p provided no 

additional explanation on the amend^ reports. The 

made the transfers from its non-federtd account 

percent federal election activity. 

In addition, ODP stated that it has implemented. 

maintained for any employee who is ^d in whole, ( 

such, ODP has complied with the Inte" dit Report 

implementing a plan to maintain moni 3gs in 

It ODP had not 

ted as 100 

thatti^ sheets are 

with non-federal funds. As 

endation by