External auditor Grant Thornton’s report has concluded the council at the time failed to ensure proper financial control over the project.
This led to the redevelopment of Fairfield Halls being delivered a year late.
It also cost “substantially more” than the original budget of £30 million agreed by the council in 2016.
The council says an action plan will be put into place to address the findings of the report.
The redevelopment of the site was carried out by Brick by Brick, the council’s own building developer.
The company will be wound up when its current projects come to an end.