Ethics Commission
City and County of San Francisco

San Francisco Ethics Commission Audit Report: Dudum for Supervisor 2006, FPPC ID #1287197

I. Introduction

This Audit Report summarizes the audit results of the committee, Dudum for Supervisor 2006, Identification Number 1287197 (“the Committee”), for the period from January 1, 2006 through December 31, 2006.  The audit was conducted to determine whether the Committee materially complied with the requirements of the Political Reform Act (“the Act”) (California Government Code section 81000, et seq.) and San Francisco’s Campaign Finance Reform Ordinance (“CFRO”) (San Francisco Campaign and Governmental Conduct Code section 1.100, et seq). 

II. Audit Authority

San Francisco Charter section C3.699-11 authorizes the Ethics Commission (“the Commission”) to audit campaign statements that are filed with the Commission along with other relevant documents to determine whether a committee complied with applicable requirements of State and local laws.  Section 1.150(a) of the CFRO requires the Commission to audit all candidates who receive public financing.

III. Audit Scope and Procedures

This audit was performed in accordance with generally accepted auditing standards.  The audit involved a review of the Committee’s records for the period covered by the audit.  This review was conducted to determine:

  1. Compliance with all disclosure requirements pertaining to contributions, expenditures, accrued expenditures, and loans, including itemization when required;
  2. Compliance with applicable filing deadlines;
  3. Compliance with restrictions on contributions, loans, and expenditures;
  4. Accuracy of total reported receipts, disbursements, and cash balances as compared to bank records;
  5. Compliance with all record-keeping requirements;
  6. Compliance with all provisions related to the Commission’s public financing program; and
  7. Determination of any unexpended public funds that must be returned to the Election Campaign Fund up to the amount of public funds received by the candidate.

The Commission posts audit reports to its web site and, in cases of apparent violations of law, forwards them to the appropriate enforcement agency.

IV. Committee Information

The Committee was formed in July 2006 to support the election of Ronald Dudum to the Board of Supervisors, District 4 in the November 7, 2006 general election.  Criselda Bateh served as the treasurer.  The Committee received public funds.  The Committee’s filing obligations were completed on January 30, 2007.

V. Audit Findings

For the period covered by the audit, the Committee reported receiving $55,909 in contributions (including $450 of non-monetary contributions) and $43,750 in public financing, and incurring $99,659 of expenditures.  The CFRO provides that any candidate who receives public funds must return unexpended campaign funds to the Election Campaign Fund.  The Committee did not have any unexpended funds.[1]

The Commission determined that there were two material findings with respect to the audit of the Committee, as follows:

  1. The Committee did not accrue expenses totaling $17,835 or about 18% of total expenditures in violation of Government Code Section 84211.

    Payee

    Description

    Expenses not properly Accrued

    Period during which  expense should have been reported

    Period during which expense was reported

             

    Printmail Pros. Inc.

    Mailing and postage

    $5,305

    7/1/06-9/30/06

    10/1/06-10/21/06

    Sutra Design

    Photography and door hanger design

    $575

    7/1/06-9/30/06

    10/1/06-10/21/06

    Gordon Associates Insurance Inc.

    Insurance policy (policy # ccp422114)

    $103

    7/1/06-9/30/06

    10/1/06-10/21/06

    Sutra Design

    Photography

    $300

    7/1/06-9/30/06

    10/1/06-10/21/06

    Spotlight Design & Printing

    Mass mailing (Chinese version)

    $1,050

    10/1/06-10/21/06

    10/22/06-12/31/06

    Autumn Press

    Brochure design

    $3,481

    10/1/06-10/21/06

    10/22/06-12/31/06

    Printmail Pros. Inc.

    Mailing and postage

    $3,158

    10/1/06-10/21/06

    10/22/06-12/31/06

    Printmail Pros. Inc.

    Mailing and postage

    $1,233

    10/1/06-10/21/06

    10/22/06-12/31/06

    Spotlight Design & Printing

    3,200 pieces of Chinese mailers

    $1,150

    10/1/06-10/21/06

    10/22/06-12/31/06

    Criselda S. Bateh

    Reimbursement (Office supplies, postage, computer ink)

    $155

    10/1/06-10/21/06

    10/22/06-12/31/06

    Sutra Design

    Brochure design

    $1,025

    10/1/06-10/21/06

    10/22/06-12/31/06

    Richmond Review/Sunset Beacon

    Ad on Sunset Beacon

    $300

    10/1/06-10/21/06

    10/22/06-12/31/06

             
     

    Total

    $17,835

       

    Government Code section 84211(k), which is incorporated into local law by CFRO section 1.106, requires that committees report expenditures during the reporting period in which they were incurred.  Expenditures that are incurred in one reporting period but paid in a subsequent reporting period should be reported as “accrued expenditures” on the campaign statements covering the reporting period in which they were incurred.  Committees must report the name and address of each creditor owed $100 or more, a written description of the goods or services purchased, and the amount owed.

    Committee’s Response to Finding:

    “Please be aware that during a campaign the decision to mail prepared materials is made at the last minute before the mail is sent to the Postmaster.  Actual mail-house expenses are therefore not knowable and unavailable to estimate on an accrual basis.  Since being notified of this minor discrepancy my Campaign Treasurer has agreed to amend the appropriate filings when she returns from a trip.” 

  1. The Committee did not file the required itemized disclosure statements for its five mass mailings in violation of S.F. C&GC Code Section 1.161.  Upon notification of the non-filing, the Committee promptly filed the required statements. 

    Date

    Description

    Amount

    Number Mailed

           

    10/16/06

    Two mailings:

    $20,800

    20,000

    Neighborhood School and
    Son of The Sunset

    10/21/06

    I Hate Politics

    $12,100

    12,000

    10/31/06

    The Ron Dudum We Know

    $11,430

    12,000

    11/1/2006

    Ron Dudum Listens

    $12,500

    12,000

           
     

    Total

    $56,830

     

    The Political Reform Act defines mass mailings as 200 substantially similar pieces of mail sent within a calendar month.  Section 1.161 of the CFRO requires any candidate seeking City elective office, who pays for a mass mailing that advocates for or against candidates to include on the mailing statement, “paid for by _____ (insert candidate’s name and address)” in not less than 14-point type and in a color or print which contrasts with the background so as to be easily legible.  The candidate must also file with the Commission two of the original pieces of the mailing and an itemized disclosure statement within five working days after the date of the mailing.  A candidate for City elective office shall file the original pieces of mail and the itemized disclosure statement required by subsections (b)(1) and (b)(2) within 48 hours of the date of mailing if the mailing occurs within the final 16 days before the election.

    Committee’s Response to Finding:

    “Documentation of mass mailings was not filed with the Ethics Commission.  I thought it had been taken care of, but was apparently mistaken.  I am responsible for this oversight and have filed the appropriate documentation.”

[1] Unexpended funds are calculated by subtracting any unpaid bills, on-going qualified campaign expenditures, and forfeitures from the amount of cash that the Committee had on hand on the 30th day following the election in which the candidate was elected or defeated.

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