Niblett breeds and sells game birds for a living.
It is alleged he was selling captive reared mallard ducks to Ngamatea Station for its commercial hunting operation, RNZ reported.
Bates is a co-owner of Ngamatea Station.
Breeding, selling and releasing mallards on privately-owned land is allowed with a permit, but commercial hunting of them is not allowed under the Wildlife Act.
RNZ said the audit would investigate the council's policies and procedures in relation to any release of game birds or captive rear mallards, and the release of any game birds or captive rear mallards by anyone who is, or was, a councillor over the past five years.
Niblett said he was unable to comment while the audit was ongoing.
Hawke's Bay Today was unable to contact Bates.
The 12-member Hawke's Bay Fish & Game council was elected only in October.
Former regional chairman Kevin Williams declined to comment on the audit but said it would be "business as usual" as far as the public, hunters and anglers were concerned.