New Zealand First Party officials believed the secretive Spencer Trust was the same as the party, and that is why investigations have found no wrongdoing over party donations.
The officials believed they did not have to declare money from the trust because it was involved in party administration.
The police say New Zealand First committed no offence and they will not investigate further.
After the decision was announced on Tuesday 4 November, the Electoral Commission revealed the reasoning behind its decision the previous week that the party had not breached the Electoral Act.
The commission says the original return for 2007 was materially wrong because it did not include an $80,000 donation from the Spencer Trust.
But it says the party secretary did not file the return knowing it to be false because legal advice indicated the Spencer Trust was a body of persons involved in the administration of the affairs of the party.