The ABC Q&A program's own background checks on Zaky Mallah concluded he was not dangerous and would be suitable to ask a question.
The Department of Communications on Friday released a three-page review of the June 22 program in which the former terror suspect appeared.
Mallah's appearance on the show, where he asked a minister about terrorism laws, triggered outrage among politicians as well as almost 1000 complaints to the ABC.
He was well-known to the Q&A editorial management team, having first registered as an audience member in 2011 and attending on two previous occasions.
The report found his selection for the audience on June 22 appeared "consistent" with the program's general practices.
But it was the first time Mallah had been short-listed for a question and given the opportunity to ask it.
Before allowing him the question, the program team sought to check his background with two people who knew him, but were unsuccessful.
The team then examined their previous experience with Mallah, sought the advice of an ABC journalist, reviewed a recent TV appearance and looked at an August 2014 review of his social media posts.
The report said these checks determined "he was not dangerous, would not be disruptive and would be a suitable audience member to ask a question".
The executive producer of the program - who was the highest-ranked ABC employee consulted on the appearance - has since been disciplined following a review by the ABC board.
The ABC has formally acknowledged an error of judgment in allowing Mallah onto the program.
The department's review found that managing director Mark Scott and head of editorial policy Alan Sunderland had approved the rebroadcast of the program, on the proviso that an advisory be added that acknowledged the error of judgment.
"The ABC has advised that it is only on rare occasions that the ABC may withdraw or edit a program prior to repeat, if there are known legal concerns or formal editorial content breaches identified in a program," the report said.
A section on security protocols for the program has been kept secret.
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