Dysfunctional, disorganised and so chaotic they didn't know how many fans were at their own music festival.

Just some of the damning conclusions reached in the final report by council auditors looking into Leicester's landmark venue De Montfort Hall.

Leicester City Council called in its internal audit team after forged wristbands were found to be circulating at last year's Summer Sundae festival.

The scope of that inquiry broadened after auditors discovered "serious failings" in the venue's management and administration.

The executive summary of their final report, published last month, has now been released to the Mercury by the council.

Many of the findings provide official confirmation of the catalogue of financial, management and contractual problems already uncovered in a series of investigations by this newspaper.

"The administration of the hall was dysfunctional with significant breaches of established council procedures and, in some cases, potential breaches of the law," the auditors concluded.

After reading the report, the city council's Conservative opposition leader, Ross Grant, said: "Everything you can imagine going wrong has gone wrong.

"It would be easier to count off the corporate policies that have been followed than those that have been broken."

The Mercury reported last October that the hall had bust its budget by a total £1.41 million in the previous two years despite a council subsidy of £1.05 million. In the last financial year, the overspend was £570,000. Both deficits had to be filled from council coffers.

Yet the auditors said: "It is not possible to give any assurance that De Montfort Hall is using resources effectively, nor that all resources are being used for the purposes intended."

It is "certain" forged wristbands were circulating on the third day of last year's Summer Sundae, according to the audit report.

How many or how they came to be forged will never be known due to "inadequate" records. "Wristband control documents were poorly completed, incomplete and in some cases illegible," said the report.

"It appears from these documents that thousands of complimentary wristbands had been issued, though the records are so poor that it is impossible to say with certainty to whom the wristbands had been issued."

Consequently, the total attendance at the event could not be assessed from a "health and safety or accounting perspective".

Other problems discovered by the auditors included:

Widespread and endemic failure to follow finance procedures.

Invoices so vague it was impossible to verify whether goods and services had been received.

Evidence of misuse of petty cash.

A culture of employees, their families and friends being given free admission to shows.

Widespread failure to declare potential and real conflicts of interest by hall staff.

Evidence the council's recruitment and selection procedures had not been followed.

Allegations of bullying by members of staff against colleagues which appeared not to have been addressed by management.

The Mercury has already reported the council paid consultants Deloitte £37,000 to look at ways of turning the troubled hall around.

They said recommendations, delivered in February 2008, were "implemented only in part and it is clear problems remained".

Council chief executive Sheila Lock said problems raised by its auditors were being addressed through the De Montfort Hall Improvement Plan, a root and branch overhaul of policies and procedures drafted by senior officers.

"We have built all necessary actions into our improvement plan, indeed many of those actions have already been completed," she added.

Hall manager Richard Haswell was suspended, along with two other council employees, shortly after auditors began their investigations. One has since left her job and one has returned to work, but Mr Haswell remains suspended.

Coun Grant wants answers as to why senior council managers did not do more to implement Deloitte's recommendations.

Officers and politicians responsible for keeping the hall on track have to "take responsibility", he said.

"We spent a lot of money getting those consultants in and we did nothing with their report," he said. "Taxpayers are hundreds of thousands of pounds out of pocket."

City Council leader since March this year, Veejay Patel, said work would start immediately on rectifying the many problems.

He said: "We have to turn this around. I will take a personal interest to ensure the hall is run more effectively, that our new action points are delivered – and within budget. That is crucial.

"A lot of work needs to be done. Stringent procedures will be put in place."