A former Ministry of Transport senior manager who was jailed for stealing $725,000 of taxpayers' money has been refused parole.

Joanne Harrison continues to pose an undue risk to society, the Parole Board has ruled.

The Northland woman was jailed for three years and seven months last February after pleading guilty to three charges of dishonestly taking or using a document.

A case led by the Serious Fraud Office found she had defrauded the ministry over a period spanning about 10 years while she was employed as a general manager.

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Just as her theft was being discovered she fled New Zealand in 2016.

A reserved decision was made yesterday to decline parole after the Parole Board considered Harrison for parole at the end of last month.

In a decision written by Hon J W Gendall QC it was stated Harrison had made continued attempts to minimise her criminal fraudulent activity.

"Her continued attempts at minimisation illustrates cognitive distortions, and endeavouring, it appears, to deflect her true culpability," it read.

The decision stated Harrison needed to move into the reintegrative phase of her sentence so as to prove she could be trusted in diverse circumstances.

"She has had a very lengthy period of dishonest, deceptive and fraudulent behaviour in the community.

"She requires careful and cautious reintegration measures before the pattern of behaviour adopted by her over that time can be totally put behind her."

Harrison was also wanted in connection with fraud in Australia - but her lawyer says she has no obligation to return to that country.

The denial of parole followed an initial parole declination late last year.

After the October hearing, the Parole Board declined to approve her parole because she continued "to impose an undue risk to the safety of the community".

Over the course of her offending Harrison made false invoices to three fake entities to misappropriate the funds into her own accounts.

She used the money to pay off credit card debts and pay a mortgage on a house.

Auditor-General Martin Matthews resigned in August over the scandal.

Matthews said in a statement at the time that speculation about how he handled issues around Harrison while he was head of the Transport Ministry had made it untenable for him to continue as Auditor-General.

Whistleblowers had told Matthews of their concerns about Harrison but he took no action at the time.

"I deeply regret and apologise for the fraud that was committed by an accomplished fraudster," Matthews said in his statement.