FEDERAL ELECTION COMMISSION

Washington, DC 20463 

June 3, 2019 

MEMORANDUM

To: The Commission

Through: Alec Palmer

 Staff Director

From: Patricia C. Orrock

Chief Compliance Officer

 Rickida Morcomb 

 Audit Manager 

By: Jeff Spilizewski

 Lead Auditor 

Subject: Audit Division Recommendation Memorandum on the Oklahoma 

Democratic Party (A17-19) 

Pursuant to Commission Directive No. 70 (FEC Directive on Processing Audit Reports), 

the Audit staff presented the Draft Final Audit Report (DFAR) to the Oklahoma Democratic 

Party (ODP) on April 29, 2019 (see attachment). 

This memorandum provides the Audit staff’s recommendation for each finding outlined in 

the DFAR. In response to the DFAR, ODP stated it would not be submitting an additional 

response or requesting an audit hearing.

 

Finding 1. Misstatement of Financial Activity

A. Misstatement of Financial Activity– Most Recent Reports Filed Prior to 

the Audit

The Audit staff recommends that the Commission find that ODP understated 

receipts by $30,581 and misstated disbursements by $36,852 for calendar 

year 2015. 

B. Misstatement of Financial Activity – Original Reports Filed

The Audit staff recommends that the Commission find that ODP understated 

receipts by $1,796,094 and disbursements by $1,759,832 on the original 

reports filed over the two-year period ending December 31, 2016. 
2

Finding 2. Misstatement of Levin Fund Activity

The Audit staff recommends that the Commission find that ODP understated Levin 

receipts by $21,750 and understated Levin disbursements by $29,087 for calendar 

year 2015. The Audit staff also recommends that the Commission find that ODP 

understated Levin receipts by $20,000 and understated Levin disbursements by 

$24,364 for calendar year 2016.

Finding 3. Recordkeeping for Employees

The Audit staff recommends that the Commission find that ODP did not maintain 

monthly payroll logs or equivalent records totaling $39,410 to document the 

percentage of time each employee spent in connection with a federal election for 

calendar years 2015 and 2016.

Finding 4. Reporting of Debts and Obligations

The Audit staff recommends that the Commission find that ODP failed to disclose 

debts and obligations totaling $23,187 and erroneously disclosed debts and 

obligations totaling $22,700.

The Office of General Counsel has reviewed this memorandum and concurs with the 

recommendations.

If this memorandum is approved, a Proposed Final Audit Report will be prepared within 30 

days of the Commission’s vote.

In case of an objection, Directive No. 70 states that the Audit Division 

Recommendation Memorandum will be placed on the next regularly scheduled open 

session agenda.

Documents related to this audit report can be viewed in the Voting Ballot Matters folder. 

Should you have any questions, please contact Jeff Spilizewski or Rickida Morcomb at 694-

1200.

Attachment:

- Draft Final Audit Report of the Audit Division on the Oklahoma Democratic Party

cc: Office of General Counsel
Draft Final Audit Report of the 

Audit Division on the 

Oklahoma Democratic Party 

(January 1, 2015 - December 31, 2016) 

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.1

 The 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 any of the 

matters discussed in this 

report.

About the Committee (p. 2)

The Oklahoma Democratic Party is a state party committee 

headquartered in Oklahoma City, Oklahoma. For more 

information, see the chart on the Committee organization, p. 2. 

Financial Activity (p. 3)

 Receipts

o Contributions from Individuals 

o Contributions from Political 

Committees 

o Transfers From Affiliated/Other 

Party Committees 

o Transfers from Non-Federal and 

Levin Funds 

o Other Federal Receipts 

Total Receipts

$ 408,448 

230,788 

3,091,164 

95,089 

36,952 

$3,862,441 

 Disbursements

o Operating Expenditures 

o Transfers to Affiliated/Other 

Party Committees 

o Federal Election Activity 

o Other Disbursements 

Total Disbursements 

 Levin Receipts 

 Levin Disbursements 

$ 488,575 

3,003,100 

340,526 

17,189 

$3,849,390 

$51,750 

$60,770 

Findings and Recommendations (p. 4) 

 Misstatement of Financial Activity (Finding 1) 

 Misstatement of Levin Fund Activity (Finding 2) 

 Recordkeeping for Employees (Finding 3) 

 Reporting of Debts and Obligations (Finding 4) 

 

1

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

Audit Division on the 

Oklahoma Democratic Party 

(January 1, 2015 - December 31, 2016) 
Table of Contents 

 Page

Part I. Background 

 Authority for Audit 1 

 Scope of Audit 1 

 Commission Guidance 1 

Part II. Overview of Committee 

Committee Organization 2 

 Overview of Financial Activity 3 

Part III. Summaries 

 Findings and Recommendations 4 

Part IV. Findings and Recommendations 

Finding 1. Misstatement of Financial Activity 6

Finding 2. Misstatement of Levin Fund Activity 9

Finding 3. Recordkeeping for Employees 11

Finding 4. Reporting of Debts and Obligations 12
 1 

Part I 

Background 

Authority for Audit 

This report is based on an audit of the Oklahoma Democratic Party (ODP), 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 conducting any audit under this 

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

committees to determine if the reports filed by a particular committee meet the threshold 

requirements for substantial compliance with the Act. 52 U.S.C. §30111(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 and loans; 

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 disclosure of disbursements, debts and obligations; 

6. the disclosure of expenses allocated between federal and non-federal accounts; 

7. the consistency between reported figures and bank records; 

8. the completeness of records; and 

9. other committee operations necessary to the review. 

Commission Guidance 

Request for Early Commission Consideration of a Legal Question 

Pursuant to the Commission’s “Policy Statement Establishing a Program for Requesting 

Consideration of Legal Questions by the Commission,” several state party committees 

unaffiliated with ODP requested early consideration of a legal question raised during 

audits covering the 2010 election cycle. Specifically, the Commission addressed whether 

monthly time logs under 11 CFR §106.7(d)(1) were required for employees paid with 100 

percent federal funds. 

The Commission concluded, by a vote of 5-1, that 11 CFR §106.7(d)(1) does require 

committees to keep a monthly log for employees paid exclusively with federal funds. 

Exercising its prosecutorial discretion, however, the 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. 
 2 

Part II 

Overview of Committee 

Committee Organization 

Important Dates 

 Date of Registration October 9, 1984 

 Audit Coverage January 1, 2015 - December 31, 2016 

Headquarters Oklahoma City, Oklahoma 

Bank Information 

 Bank Depositories Two 

 Bank Accounts Three Federal, Two Non-Federal, and 

One Levin 

Treasurer 

 Treasurer When Audit Was Conducted Rachael Hunsucker (7/19/17 - Present) 

 Treasurer During Period Covered by Audit Donna Russell (5/18/11 - 7/18/17) 

Management Information 

 Attended FEC Campaign Finance Seminar Yes 

 Who Handled Accounting and 

Recordkeeping Tasks 

Paid Staff 
 3 

Overview of Financial Activity 

(Audited Amounts) 

 

Cash on hand @ January 1, 2015 $ 1,972 

Receipts 

o Contributions from Individuals $ 408,448 

o Contributions from Political Committees 230,788 

o Transfers From Affiliated/Other Party 

Committees 3,091,164 

o Transfers from Non-Federal and Levin Funds 95,089 

o Other Federal Receipts 36,952 

Total Receipts $3,862,441 

Disbursements 

o Operating Expenditures $ 488,575 

o Transfers to Affiliated/Other Party 

Committees 3,003,100

o Federal Election Activity 340,526 

o Other Disbursements 17,189 

Total Disbursements $3,849,390 

Cash on hand @ December 31, 2016 $ 15,023 

 

Levin Cash on hand @ January 1, 2015 $ 9,675 

Total Levin Receipts 51,750

Total Levin Disbursements 60,770

Levin Cash on hand @ December 31, 2016 $ 655 

 
 4 

Part III 

Summaries 

Findings and Recommendations 

Finding 1. Misstatement of Financial Activity

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

records revealed a misstatement of receipts and disbursements in calendar year 2015. 

Specifically, ODP understated receipts by $30,581 and misstated disbursements by 

$36,852. In response to the Interim Audit Report recommendation, ODP amended its 

disclosure reports correcting the misstatements for the 2015 calendar year. 

In addition, a comparison of ODP’s bank activity with its original reports filed for 2015 

and 2016 also revealed a material misstatement of receipt and disbursement activity. In 

response to the Interim Audit Report recommendation, ODP had no further comments. 

(For more detail, see p. 6.) 

Finding 2. Misstatement of Levin Fund Activity 

During audit fieldwork, a comparison of ODP’s Levin Fund reported financial activity 

with its bank records revealed a misstatement of receipts and disbursements for calendar 

years 2015 and 2016. In 2015, ODP understated Levin receipts by $21,750 and 

understated Levin disbursements by $29,087. In 2016, ODP understated Levin receipts 

by $20,000 and understated Levin disbursements by $24,364. In response to the Interim 

Audit Report recommendation, ODP amended its disclosure reports correcting the 

misstatements for the 2015 and 2016 calendar years. 

(For more detail, see p. 9.) 

Finding 3. 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 2015 and 2016, the Audit staff identified 

payments to ODP employees totaling $39,410 for which ODP did not maintain monthly 

payroll logs. This consisted of payroll which was allocated with federal and non-federal 

funds. There was no payroll paid exclusively with non-federal funds. ODP 

representatives responded, during fieldwork and the exit conference, that it did not 

maintain payroll logs for employees during calendar years 2015 and 2016, but has 

implemented a process to record this information in conjunction with employees’ 

timesheets. In response to the Interim Audit Report recommendation, ODP had no 

further comments. 

(For more detail, see p. 11.) 

 
 5 

Finding 4. Reporting of Debts and Obligations 

During audit fieldwork, the Audit staff noted that ODP failed to disclose or erroneously 

disclosed debts and obligations to four entities, totaling $45,887. In response to the 

Interim Audit Report recommendation, ODP filed amended disclosure reports for 2015 

and 2016 to disclose these debts and obligations, which materially corrected the public 

record. 

(For more detail, see p. 12.) 
 6 

Part IV

Findings and Recommendations

Finding 1. Misstatement of Financial Activity 

Summary 

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

records revealed a misstatement of receipts and disbursements in calendar year 2015. 

Specifically, ODP understated receipts by $30,581 and misstated disbursements by 

$36,852. In response to the Interim Audit Report recommendation, ODP amended its 

disclosure reports correcting the misstatements for the 2015 calendar year. 

In addition, a comparison of ODP’s bank activity with its original reports filed for 2015 

and 2016 also revealed a material misstatement of receipt and disbursement activity. In 

response to the Interim Audit Report recommendation, ODP had no further comments. 

Legal Standard 

Contents of Federal Reports. Each report must disclose: 

 the amount of cash on hand at the beginning and end of the reporting period; 

 the total amount of receipts for the reporting period and for the calendar year; 

 the total amount of disbursements for the reporting period and for the calendar 

year; and 

 certain transactions that require itemization on Schedule A (Itemized Receipts) or 

Schedule B (Itemized Disbursements). 52 U.S.C. §30104 (b)(1),(2),(3),(4) and 

(5). 

Facts and Analysis 

A. Misstatement of Financial Activity– Most Recent Reports Filed Prior to the 

Audit 

1. Facts 

During audit fieldwork, the Audit staff reconciled ODP’s reported financial activity 

with its bank records for calendar years 2015 and 2016. The reconciliation 

determined that ODP misstated receipts and disbursements for 2015. The following 

chart details the discrepancies between ODP’s disclosure reports and bank activity. 

The succeeding paragraphs explain why the discrepancies occurred. 
 7 

2015 Committee Activity 

Reported Bank Records Discrepancy 

Beginning Cash on hand @ 

January 1, 2015 

$ 3,745 $ 1,972 $ 1,773 

Overstated 

Receipts $336,499 $367,080 $30,581 

Understated 

Disbursements $347,650 $357,585 $ 9,935 

Understated 

Ending Cash on hand @ 

December 31, 2015 

$ 11,4762 $ 11,467 $ 92

Overstated 

The beginning cash on hand was overstated by $1,773 and the discrepancy is 

unexplained, but likely resulted from prior period discrepancies. 

The misstatement of 2015 receipts resulted from the following: 

 Transfers from Non-federal/Levin accounts $ 4,971 

not reported or misreported 

 Contributions from individuals deposited into the (15,766) 

Non-federal/Levin Accounts erroneously reported 

 Contributions from individuals reported not supported by bank deposits (18,066) 

 Contributions from individuals not reported 57,247 

 In-kind contribution not reported as a receipt 3,220 

 Unexplained difference (1,025) 

Net Understatement of Receipts $ 30,581

ODP understated its 2015 disbursements by $9,935. However, when evaluating the 

identified errors, regardless of whether the errors were under-reported or overreported (absolute value), the Audit staff discovered that ODP misstated its 

disbursements by $36,852 as follows: 

The misstatement of disbursements resulted from the following: 

 In-kind contributions reported twice $ 9,660 

 In-kind contribution not reported as a disbursement 3,220 

 Disbursements reported but did not clear the bank 3,630 

 Transfers to the Non-federal/Levin Account not reported3 15,000 

 Disbursements not reported 5,342 

Sum of Disbursement Adjustments $36,852 

 

2

 The reported ending cash on hand does not equal reported beginning cash on hand plus reported receipts 

minus reported disbursements. This was due to mathematical discrepancies between the reported 

beginning cash on hand of reporting periods not equaling the ending cash on hand of the prior reporting 

periods. 3

 The unreported transfers consisted of two transfers to the Levin Fund and to the Non-federal account for 

the excessive portion of a contribution deposited into the Federal account. These transfers were timely 

made and did not result in an excessive finding. 
 8 

The $9 overstatement of the ending cash on hand was a result of the reporting 

discrepancies described above. 

2. Interim Audit Report & Audit Division Recommendation 

The Audit staff discussed this matter at the exit conference and provided ODP 

representatives a schedule of the misstated amounts. ODP representatives did not 

provide any comments. 

The Interim Audit Report recommended that ODP amend its disclosure reports or file 

a Form 99 (Miscellaneous Electronic Submission)4 to correct the misstatements noted 

above, reconcile the cash balance on its most recently filed report to include these 

adjustments and correct any subsequent discrepancies. 

3. Committee Response to the Interim Audit Report 

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

disclosure reports to correct the misstatements for the 2015 calendar year. 

B. Misstatement of Financial Activity – Original Reports Filed 

1. Facts 

During audit fieldwork, in addition to examining ODP’s most recent reports filed 

prior to audit notification, the Audit staff also compared its originally filed reports 

with its bank records. The purpose of this additional reconciliation was to identify 

the degree to which ODP had misstated its original filings. 

The Audit staff calculated that ODP understated receipts by $1,796,094 and 

disbursements by $1,759,832 on the original reports filed over the two-year period 

ending December 31, 2016. These figures include the $30,581 understatement of 

receipts and the $9,935 understatement of disbursements from 2015 discussed in 

Section A above (Misstatement of Financial Activity – Most Recent Reports Filed 

Prior to the Audit).

2. Interim Audit Report & Audit Division Recommendation 

The Audit staff discussed the understatement of receipts and disbursements on its 

original reports during the exit conference and provided ODP representatives a copy 

of the relevant schedule. ODP representatives asked questions for clarification but 

had no comments at the time. 

The Interim Audit Report recommended that ODP provide any additional comments 

it deemed necessary with respect to this matter. 

3. Committee Response to the Interim Audit Report 

In response to the Interim Audit Report recommendation, ODP had no further 

comments. 

 

4

 ODP was advised by the Audit staff that if it chose to file a Form 99, instead of amending its disclosure 

reports, the form must contain all pertinent information that is required on each schedule. 
 9 

Finding 2. Misstatement of Levin Fund Activity 

Summary 

During audit fieldwork, a comparison of ODP’s Levin Fund reported financial activity 

with its bank records revealed a misstatement of receipts and disbursements for calendar 

years 2015 and 2016. In 2015, ODP understated Levin receipts by $21,750 and 

understated Levin disbursements by $29,087. In 2016, ODP understated Levin receipts 

by $20,000 and understated Levin disbursements by $24,364. In response to the Interim 

Audit Report recommendation, ODP amended its disclosure reports correcting the 

misstatements for the 2015 and 2016 calendar years. 

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; and 

 Certain transactions that require itemization on Schedule L-A (Itemized Receipts 

of Levin Funds) or Schedule L-B (Itemized Disbursements of Levin Funds). 11 

CFR §300.36 (b)(2). 

Facts and Analysis 

A. Facts 

During audit fieldwork, the Audit staff reconciled ODP’s reported Levin Fund financial 

activity with its Levin Fund bank records for calendar years 2015 and 2016. The 

reconciliation determined that ODP misstated Levin receipts and disbursements for 2015 

and 2016. The following chart outlines the discrepancies between ODP’s disclosure 

reports and its Levin Fund bank records. The succeeding paragraphs explain why the 

discrepancies occurred. 

2015 Committee Levin Fund Activity 

Reported Bank Records Discrepancy 

Beginning Cash on hand @ 

January 1, 2015 

$ 0 $ 9,676 $ 9,676 

Understated 

Receipts $10,000 $31,750 $21,750 

Understated 

Disbursements $ 7,319 $36,406 $29,087 

Understated 

Ending Cash on hand @ 

December 31, 2015 

$ 05 $ 5,020 $ 5,0205

Understated 

 

5

 The reported ending cash on hand does not equal reported beginning cash on hand plus reported receipts minus 

reported disbursements. This was due to mathematical discrepancies between the reported beginning cash on 

hand of reporting periods not equaling the ending cash on hand of the prior reporting periods.
 10 

The beginning cash on hand was understated by $9,676 and the discrepancy is 

unexplained, but likely resulted from prior period discrepancies. 

The misstatement of 2015 Levin receipts resulted from the following: 

 Donations from individuals not reported $21,750 

The misstatement of 2015 Levin disbursements resulted from the following: 

 Transfers to the Federal Account not reported $29,087 

The understatement of $5,020 of the ending cash on hand was a result of the reporting 

discrepancies described above. 

2016 Committee Levin Fund Activity 

Reported Bank Records Discrepancy 

Beginning Cash on hand @ 

January 1, 2016 

$5,020 $ 5,020 $ 0 

Receipts $ 0 $20,000 $20,000 

Understated 

Disbursements $ 0 $24,364 $24,364 

Understated 

Ending Cash on hand @ 

December 31, 2016 

$ 05 $ 656 $ 6565

Understated 

The misstatement of 2016 Levin receipts resulted from the following: 

 Donations from individuals not reported $20,000 

The misstatement of 2016 Levin disbursements resulted from the following: 

 Transfers to the Federal Account not reported $24,271 

 Bank fees not reported 93 

Understatement of Levin Disbursements $24,364

The $656 understatement of the ending cash on hand for Levin activity was a result of the 

reporting discrepancies described above.

B. Interim Audit Report & Audit Division Recommendation 

The Audit staff discussed this matter at the exit conference and provided ODP 

representatives a schedule of the misstated amounts. ODP representatives had no 

comments at the time. 

The Interim Audit Report recommended that ODP amend its disclosure reports or file a 

Form 996

 to correct the Levin Fund misstatements noted above, reconcile the cash 

balance for Levin activity on its most recently filed report to include these adjustments 

and correct any subsequent discrepancies. 

 

6

 ODP was advised by the Audit staff that if it chose to file a Form 99, instead of amending its disclosure 

reports, the form must contain all pertinent information that is required on each schedule. 
 11 

C. Committee Response to the Interim Audit Report 

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

reports correcting the misstatements for the 2015 and 2016 calendar years. 

Finding 3. Recordkeeping for Employees 

Summary 

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 2015 and 2016, the Audit staff identified 

payments to ODP employees totaling $39,410 for which ODP did not maintain monthly 

payroll logs. This consisted of payroll which was allocated with federal and non-federal 

funds. There was no payroll paid exclusively with non-federal funds. ODP 

representatives responded, during fieldwork and the exit conference, that it did not 

maintain payroll logs for employees during calendar years 2015 and 2016, but has 

implemented a process to record this information in conjunction with employees’ 

timesheets. In response to the Interim Audit Report recommendation, ODP had no 

further comments. 

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 fringe 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 from 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 comply with state law. 11 

CFR §106.7(d)(1). 

Facts and Analysis 

A. Facts 

During audit fieldwork, the Audit staff reviewed disbursements for payroll. ODP did not 

maintain any monthly payroll logs or equivalent records to document the percentage of 

time each employee spent in connection with a federal election. These logs are required 

to document the proper allocation of federal and non-federal funds used to pay employee 

salaries and wages. For 2015 and 2016, ODP did not maintain monthly logs for $39,410 

in payroll.7

 This amount includes payroll for employees reported on Schedule H4 

 

7

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

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

Legal Question, Page 1). Payroll amounts do not include fringe benefits. 
 12 

(Disbursements for Allocated Federal and Non-Federal Activity) and paid with an 

allocation of federal and non-federal funds during the same month. There was no payroll 

paid exclusively with non-federal funds.

B. Interim Audit Report & Audit Division Recommendation 

The Audit staff discussed the recordkeeping requirement with ODP representatives 

during fieldwork and at the exit conference. ODP representatives responded that ODP 

did not maintain payroll logs for employees during calendar years 2015 and 2016, but has 

implemented a process to record this information in conjunction with employees’ 

timesheets. 

The Interim Audit Report recommended that ODP provide any comments it deemed 

relevant to this matter. 

C. Committee Response to the Interim Audit Report 

In response to the Interim Audit Report recommendation, ODP had no further comments. 

Finding 4. Reporting of Debts and Obligations 

Summary 

During audit fieldwork, the Audit staff noted that ODP failed to disclose or erroneously 

disclosed debts and obligations to four entities, totaling $45,887. In response to the 

Interim Audit Report recommendation, ODP filed amended disclosure reports for 2015 

and 2016 to disclose these debts and obligations, which materially corrected the public 

record. 

Legal Standard 

A. Continuous Reporting Required. A political committee must disclose the amount 

and nature of outstanding debts and obligations until those debts are extinguished. 52 

U.S.C. §30104(b)(8) and 11 CFR §§104.3(d) and 104.11(a). 

B. Separate Schedules. A political committee must file separate schedules for debts 

owed by the committee and debts owed to the committee, together with a statement 

explaining the circumstances and conditions under which each debt and obligation 

was incurred or extinguished. 11 CFR §104.11(a). 

C. Itemizing Debts and Obligations.

 A debt of $500 or less must be reported once it has been outstanding 60 days from 

the date incurred (the date of the transaction); the committee reports it on the next 

regularly scheduled report. 

 A debt exceeding $500 must be disclosed in the report that covers the date on 

which the debt was incurred. 11 CFR §104.11(b). 
 13 

Facts and Analysis 

A. Facts 

During audit fieldwork, the Audit staff reviewed ODP’s disbursement records and 

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

debts owed to one vendor and two individuals totaling $23,187 8

 that ODP failed to report 

on Schedule D (Debts and Obligations) during the audit period. Based on a review of the 

records, the vendor provided printing service, and the two individuals were reimbursed 

for travel expenses9

 and back pay incurred during a prior election cycle. 

This review also identified one credit card vendor with debts and obligations reported on 

Schedule D totaling $22,700 during the audit period. The Audit staff's review determined 

that this vendor's debt had been extinguished since the end of 2013, and therefore was 

erroneously itemized on Schedule D.

ODP reported debt totaling $23,375 on Schedule D during the audit cycle. The Audit 

staff calculated the debts owed to the entities based on the invoice date and the 

subsequent payment date. Debts were outstanding for periods ranging from 34 days to 

31⁄2 years. 

B. Interim Audit Report & Audit Division Recommendation 

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

at the exit conference and provided a schedule detailing the transactions requiring 

disclosure or removal from Schedule D. ODP representatives had no specific comments 

at the time. 

The Interim Audit Report recommended that ODP provide documentation demonstrating 

that these transactions totaling $23,187 were not obligations which required reporting on 

Schedule D and the transaction totaling $22,700 was not erroneously itemized on 

Schedule D. 

Absent such documentation, the Interim Audit Report recommended that ODP amend its 

reports or file a Form 9910 to correctly disclose the debts and obligations totaling $23,187 

and remove the erroneously itemized debt totaling $22,700 from Schedule D. 

C. Committee Response to the Interim Audit Report 

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

reports for 2015 and 2016 to disclose these debts and obligations, which materially 

corrected the public record. 

 

8

 Each debt in this amount was counted only once even if it was required to be disclosed over multiple periods. 9

 These travel expenses were made on behalf of ODP and incurred from 2011 through 2014. The 

unreimbursed portions were not reported as memo entry contributions on Schedule A (Itemized Receipts) 

when incurred during the prior election cycles. No excessive contribution resulted from these 

unreimbursed travel expenses. 10 ODP was advised by the Audit staff that if it chose to file a Form 99, instead of amending its disclosure 

reports, the form must contain all pertinent information that is required on each schedule.