On May 4, 2023, the Federal Election Commission (FEC) approved new audit procedures for political committees that do not receive public funds. The new procedures take effect June 1, 2024 and apply to all committees that receive an audit notification after this date.
Below are some of the key takeaways from the new audit procedures:
Maintains the current triggers for an audit. The new audit procedures do not change the triggers for an audit. FEC audits are not conducted randomly. The FEC's Reports Analysis Division (RAD) reviews reports filed by committees and assigns audit points for reporting issues. For example, failure to respond to a Request for Additional Information or an inadequate or late reply can result in a committee accruing one or more audit points. If RAD determines that a committee's reporting errors exceed Commission-approved compliance thresholds, RAD will refer the committee to the FEC's Audit Division. Audits must then be authorized by an affirmative vote of four or more commissioners. If an audit is authorized, audit staff will send a notification letter to the audited committee.
Expedites the resolution of legal questions arising in an audit. Under existing procedures, a committee can obtain answers to certain legal questions arising during the audit process if a material dispute exists on a question of law. In an attempt to streamline the audit process, the new procedures terminate this existing legal question resolution program for audits and provides committees with the Office of General Counsel's (OGC) legal analysis of each proposed finding at the Exit Conference in an Exit Conference Report. The committee is then given an opportunity to meaningfully respond by submitting a written response to the Exit Conference Report.
Reduces the number of required reports. Under existing procedures, the FEC's Audit Division is required to draft four reports – the Interim Audit Report, Draft Final Report, Proposed Final Audit Report, and Final Audit Report. The new procedures eliminate the Interim Audit Report and Draft Final Report. Rather, Audit staff will prepare a Proposed Final Audit Report, and the Commission will vote on and approve a Final Audit Report.
Publishes non-confidential documents related to audit findings on its website. In an effort to increase transparency, the FEC will publish the audit documents on the FEC's website, including (1) the Exit Conference Report and accompanying OGC legal analysis, (2) the Audit Division Recommendation Report, (3) memoranda requesting compulsory process, (4) the Final Audit Report of the Commission, (5) committee responses, including attached declarations and affidavits but not including any financial materials, (6) the committee request for an Audit Hearing, (7) the transcript of the Audit Hearing, (8) Vote Certifications, (9) Statements of any commissioners, and (10) any other non-financial materials and documents upon which commissioners relied.
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