The auditor-general's report also found that as the Department of Environment rushed to meet its stimulus objectives, it became overwhelmed by claims of fraud and safety problems.
While the report makes no recommendations due to the closure of the program, the auditor-general points out there remains a range of safety concerns as well as coronial inquiries yet to be completed.
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The axed stimulus scheme was linked to four deaths and a score of house fires.
Under the program, some 1.1 million roofs were insulated at a cost of $1.45 billion but many were found to be deficient.
Of the the 13,808 roofs inspected up to March, at least 29 per cent were found to have some level of deficiency, ranging from minor quality issues to serious safety concerns.
The report notes that the program was developed in a very short period of time and was primarily a stimulus measure aimed at responding to the global financial crisis.
