The Federal Government's decision to grant $444 million dollars to the Great Barrier Reef Foundation failed to fully comply with transparency rules, auditor-general, Grant Hehir found.
In April last year, the Turnbull government announced it was giving the money to the foundation, which at the time had annual revenue of about $10 million and only six full-time staff.
Hehir and his office found the department failed to properly follow government rules around making grants - rules designed to ensure transparency and value for money.