Department under fire over whistleblower complaints
The Department for Regional Development has been heavily criticised for the way it investigated complaints made by a whistleblower.
The Audit Office said an investigation into the awarding of contracts for road signs was not well planned.
It said the department did not forensically examine complaints.
But the department has consistently rejected any suggestion of favouritism and insisted all procedures were properly carried out.
The Audit Office report centred on complaints made by the County Down contractor David Connolly.
He made 29 allegations concerning the way contracts were awarded by the Department for Regional Development, alleging that there was favouritism and that proper tendering procedures were not followed.
In 2005, he made 15 allegations on procurement arrangements for the supply delivery and erection of road signs. In 2006 and 2007 he made a further 14 allegations
The department took four years to investigate his complaints and in 2010 concluded that the process was carried out properly.
The Audit Office also said some allegations were not adequately investigated.
The report stated that the DRD investigation "failed to apply the professional investigative standards that we have seen delivered in other reviews of serious whistleblower complaints".
It also stated: "While the allegations were addressed individually, consideration was not given to recurring themes across allegations, such as favouritism, which would have highlighted the whistleblower's concerns "Legal action
The Audit Office also said the department did not deal with Mr Connolly in the way he expected.
The report stated that it "did not adequately engage with the whistleblower or manage his expectations".
The Audit Office also criticised the delay to the the original DRD investigation and said "the allegations were not addressed in a timely and prompt manner".
Its investigation also recommended that "a centralised and service-wide resource should be made available to lead or assist departments in complex investigations such as this".
Regional Development Minister Danny Kennedy said: "In keeping with normal protocols, it is not fitting for me to comment in detail when an Audit Office report is published.
"I can say that both the complaints and the DRD investigation took place before my time as minister.
"I strongly support the Audit Office's key recommendation which is to set up a central NICS-wide resource to tackle complex investigations of this nature."
David Connolly, who brought the original complaint, broadly welcomed the Audit Office report although he told the BBC it "does not go far enough".
He said all he ever wanted was the whole issue to be properly examined.
He says he now wants Stormont's Public Accounts Committee to become involved and he is planning legal action.