Knights Under Salary Cap

The National Rugby League described an inquiry into an alleged salary cap breach by Newcastle as a routine investigation and dismissed suggestions it was of huge magnitude.

NRL chief executive David Gallop confirmed the league was investigating information it had received regarding an alleged breach of the league's $3.25 million cap by the Knights.

But he stressed it was nothing out of the ordinary and the NRL regularly conducted inquiries when it received information of a possible breach by its clubs.

"There's no suggestion it's of a huge magnitude," Gallop said.

"But certainly if there was something of a big magnitude we would prioritise it.

"At this stage it's just part of a routine investigation that we do in policing the salary cap. I don't see that there's a great urgency in this one."

The Sun Herald newspaper reported the league was investigating allegations chief executive Ken Conway allowed prop Matt Parsons to use his company car and petrol card.

The paper also quoted the club's former financial controller asking the current administration to assure all Knights fans that there had not been any breaches in 2002 and 2003.

Newcastle chairman Michael Hill, speaking after his side dropped out of the top eight following a 48-14 loss to the Bulldogs at Telstra Stadium, played down comparisons with the Bulldogs' salary cap saga of last year, which cost that club $500,000 and a place in the finals.

"We're a long way off Canterbury," Hill said.

"The detail has been covered in our response (to the league). I imagine it will be investigated and if it comes up at all it will come up as part of their annual audit."

Hill said the club was confident it could abide by the league's salary cap despite the pressure of having to re-sign a host of high-profile players, including NSW prop Josh Perry and second rower Steve Simpson.

"You'd be a fool to dismiss issues and laugh them off," Hill said of the reports.

"But we're quite confident we can apply to the salary cap and we will deal with it as part of the normal cap process."