Political parties across the country have failed to disclose donations and manage their accounts and annual returns appropriately, and in some cases have faced threats of prosecution.

Almost 50 compliance reviews conducted by the Australian Electoral Commission since January 2013, obtained under freedom of information laws, show a pattern of mistakes across the political spectrum in how party groups manage their financial information.

Several of the federal branches of the Liberal party, the Greens, Labor, Family First and National party have been forced to make changes to their annual federal political returns as a direct result of AEC reviews, and have faced varying recommendations on improving the management of their accounts.

The changes range from altering total payments, receipts and debts to disclosing receipts or donations that were not initially reported.

In a small number of cases, the reviews have resulted in warnings to parties that they may commit criminal offences if they do not change their practices.

The details revealed include:

The Australian Labor party (Queensland) under-disclosed its receipts and payments by more than $4m in its 2011-12 return. This was largely due to the failure to include what was described as an “interest-free unsecured loan” from one of its associated entities, Labor Holdings Limited.

The AEC warned the Victorian Greens that it could face criminal penalties if it continued a pattern of poor recordkeeping and accounting, in a review of its 2010-11 return. The review acknowledged that “progress has been made in the development of comprehensive procedures” to facilitate accurate records.





The Liberal party of Australia had not disclosed two amounts in its 2011-12 return and and was required to amend a further entry. In a separate review of its 2010-11 return, another amount had not been disclosed and a further amendment was required.

The Family First party Victoria failed to provide any audited financial statements from its 2010-11 return, and was warned by the AEC it could face criminal penalties if a pattern of behaviour continued. The review noted that some progress had been made to improve record keeping.

The National party of Australia (New South Wales) failed to disclose a $327,392 receipt from Natpar Pty Ltd and faced criticism for how it managed its accounts. It noted that following staff changes some alterations had been made.

A group of Liberal National party (Queensland) associated entities – Altum Property Trust, Altum HQ Trust and LNP Nominees 6 St Paul’s Terrace Trust – failed to disclose more than $4m in receipts, payments and debts. The entities were also unable to provide working documents in later reviews after their accounting practices were separated from the Liberal National party. In one instance, the Altum Property Trust made a substantial reporting error in its debts “due to a typing error that added an extra zero to the figure, which had inadvertently increased the figure by a factor of 10”.

Katter’s Australia Party under-reported several figures and failed to disclose two amounts correctly in its 2011-12 return. It also provided no working papers during the review, and the AEC recommended it maintain appropriate evidence for future reports.

The AEC conducts compliance reviews periodically over a three-year cycle to make sure parties are meeting their obligations to disclose political donations and other information correctly. They are routine and not initiated as a result of any suspected breach.

A spokesman for the AEC said: “The AEC’s priority is that parties and other entities disclose correctly in accordance with the Commonwealth Electoral Act.

“The AEC undertakes a year-round program of examining financial disclosure returns lodged by political parties and associated entities, as well as comparative analysis of the reporting of donations by donors and political parties.”

While parties will occasionally make amendments to their annual returns, the reviews highlight that some changes are driven by AEC reviews, rather than instigated by the parties.

Every political party is required to lodge an annual return disclosing political donations over a certain threshold. Bodies known as “associated entities” have similar disclosure obligations.

The reviews show that the AEC generally allows parties to alter disclosures without imposing penalties where errors are identified.

Graeme Orr, a professor of law at the University of Queensland, said the AEC had a “policy of cooperation rather than confrontation”, but that it had lobbied the previous government to increase its powers to impose penalties.

He said there was no excuse – particularly for major parties – to be sloppy with their accounting.

“More than anything though we need continuous, online disclosure. The once a year, delayed, paper and pencil forms are ... laborious and delayed,” he said.

The reviews, along with short summaries of the documents and responses received from parties and associated entities, have been published in full by Guardian Australia.

The Australian Greens (Victoria) treasurer, Nicole Rowan, said: “Since the period in question almost five years ago, the AGV has significantly increased its accounting and financial management resourcing and is continuing to make improvements in these areas. The AGV has put processes into place to implement all of the AEC’s recommendations.”

The state secretary of the Queensland Labor party, Evan Moorhead, said: “The transaction in question was the transfer of monies from the ALP to Labor Holdings, and then the return of the same money split over two financial years.

“These monies were not a donation. Essentially, this is our money being returned to us. We believed that these internal transactions need not be disclosed, but were happy to comply with the AEC’s request.”

A spokesman for the National party New South Wales said: “The NSW Nationals have disclosed all the necessary donations needed by the AEC. The over disclosure of receipts and payments relates to internal party transfers, for example a transfer from the local party in Parkes into the head office accounts. This has nothing to do with political donations.

“As was acknowledged in the AEC’s audit report, since the time of the 2010-11 return there have been changes in the party’s accounting staff and procedures. This has addressed the issues raised.”

A spokesman for Family First Victoria said the party “has implemented procedures that will ensure the ongoing accuracy and completeness of records maintained.

“The party has implemented additional policies and procedures to comply with the AEC’s recommendations.”

The Katter Australia party and the Liberal party of Australia did not provide a response.

The most recent financial controller of the Queensland Liberal National party’s associated entities did not respond to emails or calls. A previous financial controller who is listed on some of the amended returns, Monique Carlson, said: “I have nothing to do with that any more. I haven’t had anything to do with that in ages.”

A Liberal National party Queensland spokesman said: “The LNP has assisted the AEC in answering all questions over its returns during the review and will take any advice into consideration.”

“The LNP fully complies with all state and federal electoral laws.”