FACIAL COMPLIANCE REVIEWS AND AUDITS
The following words and terms, when used in this chapter, shall have the following meanings, unless the context clearly indicates otherwise.
(1) Deficiency—An error, omission, inaccuracy, or violation of a law or rule administered and enforced by the commission that is apparent on the face of a statement or report filed with the commission.
(2) Compliance review report—A report sent to a filer detailing deficiencies in a report that is the subject of a facial compliance review.
(3) Facial compliance review—A review conducted under section 571.069 of the Government Code of the information disclosed on a report, randomly selected in accordance with §16.2, filed with the commission for facial completeness, accuracy, reliability, and compliance with the law.
(4) Report—A personal financial statement, lobby registration, lobby activities report, or campaign finance report filed with the commission.
The report subject to a facial compliance review must be randomly selected from a list of all reports filed by a particular filer type for a specific filing deadline.
(a) A correction filed for the report that is subject to the facial compliance review will not be subject to a late fine if:
(1) The correction is filed not later than the 30th day after the date the filer receives the compliance review report;
(2) The corrected information complies with the law; and
(3) The original report was filed in good faith and without an intent to mislead or misrepresent the information contained in the report.
(b) A late fine will not be assessed for corrections filed to correct reporting errors made in any report filed prior to the report that is subject to the facial compliance review if:
(1) The filer learned of the errors through the facial compliance review;
(2) The correction is filed not later than the 30th day after the date the filer receives the compliance review report;
(3) The corrections comply with the law; and
(4) The original report was filed in good faith and without an intent to mislead or misrepresent the information contained in the report.
(c) A correction filed in accordance with this section will not be considered a prior late offense for purposes of determining the waiver or reduction of a fine under chapter 18 of this title.
(a) The commission may request from a filer documentation and other information used by the filer to compile a report that is subject to a facial compliance review.
(b) Documentation and other information requested by the commission is timely submitted if received by the commission not later than the 30th day after the date the filer receives the request for additional documentation.
(a) The commission may initiate a preliminary review as authorized by §571.124 of the Government Code or perform a complete audit of a report that is subject to a facial compliance review under §571.069 of the Government Code if:
(1) a correction is not resubmitted to the commission in accordance with §16.3 of this title;
(2) documentation or other information requested by the commission during a facial compliance review is not submitted to the commission in accordance with §16.4 of this title; or
(3) the commission has determined by a vote of at least six commission members that the correction filed in response to a compliance review report, does not comply with the law.
The commission shall notify a filer that the commission will perform a complete audit of a report that is the subject of a facial compliance review not later than the seventh day after the date the commission votes to initiate the audit.
(a) A filer must submit to the commission, upon request and where applicable, supporting documentation in the possession, custody, or control of the filer or filer’s agents that contains information necessary for filing the report that is subject to the audit, such as:
(1) bank statements;
(2) cancelled checks;
(4) credit card statements;
(6) loan documents;
(7) books or ledgers;
(8) employee timesheets and payroll records;
(9) certificates of formation or other business documents; and
(10) real property records.
(b) A filer must submit to the commission the supporting documentation in response to an audit not later than the 30th business day from the date the filer receives notice of the audit.
(a) Commission staff must complete a draft audit report not later than the 30th day after the commission receives from the filer the documentation requested under §16.6 of this title
(b) The filer must have an opportunity to confer and object in writing to any findings in the draft audit report before it is submitted to the commission for approval.
(c) Commission staff must consider the filer’s objections before submitting the draft audit report to the commission for approval.
(d) Upon approval of an audit, the commission shall send to the filer a final audit report that includes:
(1) a notification that the commission has determined the report that was subject to the audit complies with the law; or
(2) required corrective actions that the filer must take to cure any deficiency found in the report that is subject to the audit.
(e) A filer must correct or amend a report to correct all deficiencies identified in a complete audit report not later than the 30th day from the date the filer receives the complete audit report.
(a) A filer has the right to be represented by an attorney retained by the filer during a facial compliance review or an audit initiated by the commission as a result of a facial compliance review.
(b) A letter of representation must be submitted to the commission if the filer is represented by an attorney.
The executive director may extend all deadlines related to this chapter except as provided by §571.069(a) of the Government Code (relating to when a corrected or amended report is considered filed as of the date the report was originally filed).
A filer may waive the right under §571.032 of the Government Code to receive written notices related to a facial compliance review or audit by registered or certified mail, restricted delivery, return receipt requested, and may agree to receive written notices by first class mail, electronic mail, or other means.
(a) In this section "expected total political contributions maintained" for a report subject to review is the total amount of political contributions maintained disclosed on the previous report and all monetary political contributions, loans, and credits, less all expenditures from political contributions disclosed on the report that is subject to review, excluding the purchase of investments that can be readily converted to cash.
(b) When there is a difference greater than the threshold set by §20.50(c) of this title (relating to Total Political Contributions Maintained) between the total amount of political contributions maintained disclosed in a report and the expected total political contributions maintained, the commission may request from the filer the bank statement showing the balance as of the last day of the reporting period for each account in which political contributions are maintained.
(c) Producing the requested bank statements that show the total amount of political contributions was accurately reported in the report that is subject to review is sufficient to end the review of the total amount of political contributions maintained as disclosed in the report.