A statutory investigation has found that the relationship between Waterford Institute of Technology and a group of companies is not appropriate and should be changed as a matter of urgency.
However the inspection report, published this afternoon, found no misappropriation of funds and said there was no suggestion of such.
Publishing the report, Minister for Education Ruairi Quinn also announced the provision of €10m to the college on an exceptional basis.
The inspection was ordered by the minister after concerns were raised by the Comptroller and Auditor General.
It was carried out by former Revenue Commissioners chairman Dermot Quigley.
It focused on the relationship between WIT and a group of companies. The companies provided services such as student accommodation and sports facilities.
The investigation finds no evidence of any misappropriation of funds. It goes on to state that no party it had interviewed had suggested any misappropriation.
It found that the college had developed complicated arrangements with the group of companies.
This allowed campus developments to proceed using borrowed funds. Government restrictions on third-level borrowing meant the college itself would not have been able to access similar amounts.
It found while the intention behind the development of these companies had been well-motivated, the relationship was not appropriate.
The report also found that more urgent and decisive action could have been taken by both the Higher Education Authority and the Department of Education since 2010.
The review has recommended that the companies be restructured as subsidiaries of WIT.
It has recommended that urgent action must now be taken to bring financial issues affecting the companies to a successful conclusion.
The report recommended that the department provide WIT with €10m in order to secure assets associated with some of the companies.
This includes the acquisition by the college of student accommodation. It says the money will be paid back through special charges over coming years.