Interim Audit Report of the 

Audit Division on 

Obama for America 

(January 16, 2007 - December 31, 2008) 

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.' TTie audit 

determines whether the 

committee complied with 

the limitations, 

prohibitions and 

disclosure requirements 

of the Act. 

Future Action 

The Commission may 

initiate an enforcement 

action, at a later time, 

with respect to the matter 

discussed in this report. 

About the Campaign (p. 2) 

Obama for America (OFA) is the principal campaign committee for 

Barack Obama, a candidate for the Democratic Party's nomination for 

the office of President of the United States. OFA is headquartered in 

Chicago, Illinois. For more information, see the chart on the Campaign 

Organization, p. 2. 

Financial Activity (p. 2) 

• Receipts 

o Contributions firom Individuals 

o Contributions fi'om Other 

Political Committees 

o Transfers from Authorized 

Committees 

o Offsets to Operating 

Expenditures 

o Other Receipts 

Total Receipts 

• Disbursements 

o Operating Expenditures 

o Contribution Refunds 

o Other Disbursements 

Total Disbursements 

$ 664,642,527 

14,075 

86,950,000 

25,131,132 

1,675,373 

$ 778,413,107 

$ 706,559,330 

5,756,081 

47,944,663 

$ 760,260,074 

Finding and Recommendation (p. 3) 

• Apparent Failure to File 48-Hour Notices 

2 U.S.C. §438(b). 
Interim Audit Report of the 

Division on Obama for America 

(January 16, 2007 - December 31, 2008) 
Table of Contents 

Page 

Part I. Background 

Authority for Audit 1 

Scope of Audit 1 

Part II. Overview of Campaign 

Campaign Organization 2 

Overview of Financial Activity 2 

Part III. Summary 

Finding and Recommendation 3 

Part IV. Finding and Recommendation 

Apparent Failure to File 48-Hour Notices 4 
Parti 

Background 

Authority for Audit 

This report is based on an audit of Obama for America, undertaken by the Audit Division 

ofthe 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 2 U.S.C. §438(b), which permits the Commission to conduct audits 

and field investigations of any poUtical committee that is required to file a report under 2 

U.S.C. §434. Prior to conducting any audit under this subsection, the Commission must 

perform an intemal review of reports filed by selected committees to determine if tlie 

reports filed by a particular committee meet the threshold requirements for substantial 

compliance with the Act. 2 U.S.C. §438(b). 

Scope of Audit 

Following Commission-approved procedures, the Audit staff evaluated various risk 

factors and as a result, this audit examined: 

1. The receipt of excessive contributions. 

2. The receipt of contributions from prohibited sources. 

3. The disclosure of contributions received. 

4. The disclosure of individual contributors' occupation and name of employer. 

5. The consistency between reported figures and bank records. 

6. The completeness of records. 

7. Other committee operations necessary to the review. 
Part II 

Overview of Campaign 

Campaign Organization 

Important Dates 

• Date of Registration January 16,2007 

• Audit Coverage January 16,2007 - December 31,2008 

Headquarters Chicago, Illinois^ 

Bank Information 

• Bank Depositories Four 

• Bank Accounts Sixteen 

Treasurer 

• Treasurer When Audit Was Conducted Martin H. Nesbitt May 10,2007 - Present 

• Treasurer During Period Covered by Audit Robert R. Bauer January 16,2007 - May 

9,2007, Martin H. Nesbit May 10,2007 

- Present 

Management Information 

• Attended FEC Campaign Finance Seminar Yes 

• Who Handled Accounting and 

Recordkeeping Tasks 

Paid Staff 

Overview of Financial Activity 

(Audited Amounts) 

Cash-on-hand ^ January 16,2007 $ 0 

Receipts 

o Contributions from Individuals 664,642,527 

o Contributions from Other Political 

Committees 14,075 

o Transfers from Authorized Committees 86,950,000 

o Offsets to Operating Expenditures 25,131,132 

o Other Receipts 1,675,373 

Total Receipts $ 778,413,107 

Disbursements 

o Operating Expenditures 706,559,330 

0 Contribution Refunds 5,756,081 

o Other Disbursements 47,944,663 

Total Disbursements $ 760,260,074 

Cash-on-hand @ December 31,2008 $ 18,153,033 

Originally registered as the Obaina Exploratoiy Conunittee, headquartered in Washington, DC; the committee's name was 

changed to Obama for America and the headquarters was relocated to Chicago, Illinois, according to an amended statement of 

organization filed on February 12,2007. 
Part III 

Summary 

Finding and Recommendation 

Apparent Failure to File 48-Hour Notices 

Based on audit fieldwork, OFA did not file required 48-hour notices for 1,312 

contributions totaling $ 1,972,266 received prior to the general election. The Audit staff 

recommends that OFA demonstrate notices were not required, provide evidence that 

notices were filed in a timely manner or submit any written comments it considers 

relevant. 

(For more detail, see page 4.) 
Part IV 

Finding and Recommendation 

I Apparent Failure to File 48- Hour Notices 

Summary 

Based on Audit fieldwork, OFA did not file required 48-hour notices for 1,312 

contributions totaling $ 1,972,266 received prior to the general election. The Audit staff 

recommends that OFA demonstrate notices were not required, provide evidence that 

notices were filed in a timely manner or submit any written comments it considers 

relevant. 

Legal Standard 

Last-Minute Contributions (48-Hour Notice). Campaign committees must file special 

notices regarding contributions of $1,000 or more, received less than 20 days but more 

than 48 hours before any election in which the candidate is running. This rule applies to 

all types of contributions to any authorized committee ofthe candidate. 11 CFR 

§104.5(f). 

Facts and Analysis 

A. Facts 

During audit fieldwork, a comparison was made of OFA's 48-hour notices filed to 

contributions of $1000 or more which had been reported received during the 48-hour 

notice filing period.^ This review identified 1,312 contributions totaling $1,972,266 for 

which OFA failed to file the required notices. A majority ofthe missing 48-hour notices 

arose from a transfer reported on October 24,2008 from the Obama Victory Fund (OVF), 

a joint fundraising committee whose participants were OFA and the Democratic National 

Committee (DNC). Contributions attributed to the October 24 transfer were traced to the 

disclosure reports filed by OVF to verify that they had been received between October 16 

and October 23. 

B. Interim Audit Report & Audit Division Recommendation 

Prior to the end of audit fieldwork, and again at the exit conference. Audit staff provided 

OFA with schedules of contributions for which 48-hour notices were not filed. At the 

exit conference, the OFA representative stated that the schedule was being reviewed and 

that comments or corrections would be forthcoming. 

Subsequent to the exit conference, the OFA provided copies of what it believed were the 

complete batches for each of its seventeen 48-hour notice submissions. Some ofthe 

batches contained contributions not found among the contributions listed on the pubhc 

record. The difference between the sum of the batch totals and the total for all 48-hour 

notices appearing on the public record was approximately $1,020,000. Records regarding 

The 48-hour report period ran from October 16* through November 1' 
these submissions indicate that the Commission placed all the data transmitted on the 

public record. Further, there are no filters in place that would restrict any data submitted. 

Since the Audit staff has been assured that all data submitted is routinely posted to the 

public record, OFA was asked whether some filter might have been inadvertently applied 

by its data processing vendor. No response to this query has been received from OFA to 

date. 

The Audit staff recommends that, within 30 calendar days of service ofthis report, OFA 

provide: 

• documentation to demonstrate that the 48-hour notices were filed 

for the contributions in question; or, 

• documentation establishing the contributions were not subject to 

48-hour notification; and/or, 

• any written comments it considers relevant.