Rebekah Brooks denied today that she "cooked the books" to hide a £92,000 contract with a phone hacker when she was editor of the News of the World.
In a lengthy exchange under cross-examination at the Old Bailey, Brooks denied knowing about the deal with private investigator Glenn Mulcaire.
It was allegedly concealed in weekly payments to his company and signed off by then managing editor Stuart Kuttner, the hacking trial was told.
Prosecutor Andrew Edis QC said to Brooks: "What I am suggesting to you is, it is now perfectly clear the books were cooked to prevent anybody investigating or finding out what Mr Mulcaire was doing."
Brooks said: "I did not cook any books."
"Somebody cooked them," Mr Edis said: "It should have been £92,000 and not 52 payments."
Brooks agreed the cumulative total "should have gone to me", adding: "Because it was paid in relatively small weekly payments and the news desk obviously kept within their weekly spending limit, it was never brought to my attention."
Mr Edis went on: "You do accept this contract was hidden?"
She replied: "I accept it should have come to me and Mr Kuttner."
"Mr Kuttner approved every payment so he knew what was going on," Mr Edis asserted.
"Did he ever tell you 'I'm paying £1,769 to a company I have never heard of and I do not know what they do. Is that all right, boss?'"
She replied: "No, he never, ever said anything like that to me."
Mulcaire's contract was drawn up in 2001 when Brooks was NotW editor, the court was told.
He was caught and convicted of hacking phones in 2006, after she had left the Sunday tabloid, the jury heard.
Brooks, 45, of Churchill, Oxfordshire, denies conspiracy to hack phones, conspiracy to commit misconduct in public office and conspiracy to pervert the course of justice.
Co-defendant Kuttner, 73, of Woodford Green, Essex, also denies the alleged hacking conspiracy. All seven defendants deny the charges against them.
Mr Edis read out Brooks's own contract, which outlined her responsibility as editor for the editorial budget and staffing at the NotW.
Brooks could "hire and fire" as she saw fit. He said: "That means who worked for the company was up to you and nobody else."
He asked: "Did anybody else have the power to enter into an agreement with Mr Mulcaire for £92,000 per annum?"
She replied that heads of department entered into agreements all the time.
Asked what she would say, if she discovered a head of department had made such an agreement with Mulcaire, she said: "I would have asked him what it was for and I would have asked him if he sought approval from the managing editor's office."
Mr Edis responded: "It was not the managing editor's job."
She went on: "If I had discovered it had been done behind my back, I would have asked those questions."