Campaign financial statements are required by law to disclose income and expenses for political campaigns. Candidates must account for all funding sources and expenses, including donations, loans, and personal investments. Reports are reviewed by election officials for compliance and illegal contributions.
Campaign financial statements are documents required by regional and national law that disclose income and expenses for political campaigns, i.e. campaigning for public office. Candidates and political parties in many countries are required to submit financial reports during election campaigns. These reports contain detailed accounts of donations and expenses for the reporting period. A candidate or party must account for loans, grants and campaign donations and other sources of funding in each report. Election officials review these reports to ensure they meet limits on the size and sources of donations. Consequences for failing to report are determined by regional and national electoral commissions with common fines in most cases.
The treasurer of a campaign or political party must first explain all funds provided to the candidate during the reporting period. Political candidates often receive small donations from individuals that must be fully accounted for in order to comply with election laws. Another source of funding is a political party committee, which is a special group set up by a political party to assist candidates. Campaign finance reports must also detail contributions from political action committees (PACs) or groups created by corporations, unions, and other interest groups to support candidates. Applicants wishing to self-finance their campaigns must document loans from personal equity investments.
These funds must be reconciled with the expenses of a political campaign during each quarter of the election period. In addition to the money spent on advertising campaign and vote-getting efforts, candidates must provide itemized lists of office rents and salaries paid from their previous financial dealings. Another element of a campaign finance report is a section that deals with payments to party committees. This expense is used by candidates with large funds who want to assist their party as the election approaches. Campaign finance reports also require candidates to report donations from their treasuries to other candidates during the reporting period. This requirement ensures that candidates cannot use their campaign accounts as a haven for excessive donations to other candidates.
Each campaign financial report is carefully reviewed by regional and national election officials for compliance with the law. These reports are reviewed initially to ensure all sections are completed and supported by accompanying documents. Election officials also look at donations to and from each campaign through the lens of existing financial constraints. Donor lists attached to campaign financial reports are scrutinized for illegal contributions from foreign sources, as well as unions and companies without registered PACs.
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