Many industries are required to monitor themselves in meeting regulatory policies intended to protect the environment. Self-reporting of environmental performance can place the cost of monitoring on companies rather than taxpayers, but there are obvious risks of bias, often addressed through external audits or inspections. Surprisingly, there have been relatively few empirical analyses of bias in industry self-reported data. Here, we test for bias in reporting of environmental compliance data using a unique data set from Canadian salmon farms, where companies monitor the number of parasitic sea lice on fish in open sea pens, in order to minimize impacts on wild fish in surrounding waters. We fit a hierarchical populationdynamics model to these sea-louse count data using a Bayesian approach. We found that the industry's monthly counts of two sea-louse species, Caligus clemensi and Lepeophtheirus salmonis, increased by a factor of 1.95 (95% credible interval: 1.57, 2.42) and 1.18 (1.06, 1.31), respectively, in months when counts were audited by the federal fisheries department. Consequently, industry sea-louse counts are less likely to trigger costly but mandated delousing treatments intended to avoid sea-louse epidemics in wild juvenile salmon. These results highlight the potential for combining external audits of industry self-reported data with analyses of their reporting to maintain compliance with regulations, achieve intended conservation goals, and build public confidence in the process.