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San Francisco Ethics Commission Audit Report: Bayard Fong for Board of Education, FPPC ID #1290444


I. Introduction

This Audit Report summarizes the audit results of the committee, Bayard Fong for Board of Education, Identification Number 1290444 (“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 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; and
  5. Compliance with all record-keeping requirements.

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 August 2006 to support the election of Bayard Fong to the office of Member of the Board of Education in the November 7, 2006 general election.  Danny Lam served as the treasurer.  The Committee was active as of December 31, 2006.

V. Audit Findings

For the period covered by the audit, the Committee received $61,855 in contributions (including $15,000 in candidate loans and $900 in non-monetary contributions) and incurred $45,750 in expenditures.

The Commission determined that there were three material findings with respect to the audit of the Committee.

  1. The Committee failed to provide the Commission with complete campaign records, in violation of Government Code § 84104 and S.F. C&GC Code section 1.106.

    It is the responsibility of each treasurer to maintain such detailed accounts, records, bills and receipts as are necessary to prepare campaign statements and comply with the provisions of Government Code § 84100, et seq.  The Committee did not maintain complete records. 

    The Committee failed to provide the Commission with records for $20,438 in contributions. Copies of contribution checks for at least 81 contributions were not provided.  In addition, the Committee failed to provide the Commission with records for $27,076 in expenditures.

  2. The Committee failed to accrue $7,180 or about 16% of expenses, in violation of Government Code section 84211 and S.F. C&GC Code section 1.106.

    Government Code Section 84211, which is incorporated into local law by S.F. C&GCC §1.106, requires that costs incurred by a committee, but not paid during the reporting period, be reported as “accrued expenditures.”  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.

    The Committee failed to accrue expenditures totaling $7,180, or 16 percent of total expenditures.  The expenditures not timely reported are listed below.

    Invoice Date

    Check No.



    Total of Expenditures Not Accrued

    Reporting period in which expenditures

    should have been reported

    was reported



    Spotlight Design

    11”x7” Mail Piece






    Dennis Hearne

    Photography Services






    Peter Fong

    Sing Tao newspaper






    Small Business Exchange, Inc.

    Return of corporate contribution dated 11/1/06.






    Lorene Chan

    Poster materials


    Likely incurred prior to election




    Mimi Bui

    Reimbursement for campaign supplies










  3. The Committee made expenditures of $100 or more in cash, in violation of Government Code section 84300(b) and S.F. C&GC Code section 1.106.

    Government Code section 84300(b), which is incorporated into local law by S.F. C&GC Code section 1.106, provides that no expenditure of $100 or more shall be made in cash.

    Committee records reflected two withdrawals from the bank account of $1,000 each.  The Commission was unable to determine what these funds were used for.

VI. Committee’s Response to Finding

The Committee did not provide any comments regarding the findings listed above.

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