NSW Premier Gladys Berejiklian has described her office's unlawful shredding of documents on awarding grants, including some potentially related to former Wagga MP Daryl Maguire, as a "misunderstanding".
A State Archives and Record Authority report found last week that "the Office of the Premier breached the State Records Act with the unauthorised disposal of the working advice notes" related to the Stronger Community Fund grants.
The NSW upper house's Public Accountability Committee has been investigating Ms Berejiklian's use of the $252 million given out by the fund, including during the 2018 Wagga by-election, in light of her admitting to a prior "close personal relationship" with Mr Maguire.
"I accept the [authority's] recommendation that, in their view, it was based on misunderstanding as opposed to anything systemic or sinister," Ms Berejiklian said on Monday.
"We will be accepting all of their recommendations and I note that some parts of the [Ministers' Office] Handbook in relation to archives haven't been updated for decades, so this is a good time to update the handbook, make sure everybody is aware of their obligations and to make sure that everything is done properly into the future."
Ms Berejiklian said report had revealed other Ministers' offices might have "unintentionally" destroyed documents "for many decades" that they were legally required to archive.
Labor opposition leader Jodi McKay described the shredding of documents as "an absolute disgrace".
"This is unacceptable. There appears to be no depth too low for this government to sink to...Labor will also consider whether the powers available to State Archives and Records are adequate or need reinforcing," she said.