CNN:

Thompson filed papers Friday with the Tennessee Secretary of State creating "Friends of Fred Thompson," a state-based corporation that will raise and spend money to gauge interest and support for a possible Thompson White House bid.

Under federal law, prospective candidates are allowed to raise and spend money to "test the waters" for a bid for federal office without having to create a federal campaign committee. However, once a candidate declares his or her candidacy, the candidate must then go back and report any money raised and spent during the "testing the waters" phase. These organizations have been called both "exploratory" and "testing the waters" committees.

The advantage to Thompson in creating a state committee is that it allows him to begin raising money for a possible presidential campaign, but exempts him from having to file a detailed campaign finance report for this quarter.

Thompson probably wouldn't want to file a report this quarter, since the tally would certainly be much lower than those of his competitors. After all, he only has the month of June this quarter, while the others been busy raising cash for the last two months.