The Northern Ireland Audit Office has queried the North's Tourist Board procedures over contracts awarded to a company connected to its chairman, Mr Roy Bailie.
The procedures are among a series of mistakes and slack accounting methods by British government departments in the North and other public sector bodies, highlighted in the 19992000 report by the Audit Office.
Mr John Dowdall, the comptroller and auditor general, said in his audit that, over a number of years, the Northern Ireland Tourist Board had "not complied with proper purchasing procedures in awarding contracts to the value of £3.9 million".
One of the weaknesses outlined was "failure to ensure adequate competition, not least in the circumstances where one of the companies awarded print contracts has an association with the NITB chairman".
Mr Bailie had a "significant interest" in W&G Baird, which won contracts worth £1.7 million - 45 per cent of NITB printing contracts - from 19922000, according to the report.
This supplier relationship existed prior to Mr Bailie joining the board of the NITB in 1994. He became deputy chairman in 1995 and chairman in 1996.
Mr Dowdall said: "Failure to follow proper procedure by means of open competitive tendering means that NITB is not well placed to defend itself against allegations of favouritism, not least in the case of W&G Baird."
While he accepted the finding of a Department of Enterprise, Trade and Investment (DETI) review that the NITB chairman had acted "entirely properly", there were lessons to be learned.
Complaints from another company led to the DETI audit in February 2000, which found that in a significant number of cases the successful tender "was not the lowest tender and the rationale behind this decision was not explained".
Examination of eight tenders W&G Baird made in 1999-2000 for print contracts showed four of its five successful bids had not been the lowest tender, he said. Mr Dowdall said W&G Baird was not the only company to benefit from the "poor procedures" implemented by NITB. He added: "NITB staff did not follow the approved tendering procedures."
Mr Bailie could not be contacted for comment last night. However, an NITB statement said: "NITB acknowledges that in the past it failed to adhere to best practice in purchasing procedures and has already taken action to ensure that all future procurement is conducted in accordance with government guidelines."
Mr Dowdall was also critical of the Training and Employment Agency for not following "proper purchasing procedures" in awarding contracts worth £900,000 to the GCAS group of companies for design and advertising services. He said the tendering process for all purchases should be "transparent and clearly documented".