Barringer did not respond to requests for comment on the report's findings. But at the time of the BuzzFeed News investigation last year, she denied that the charity's finances were mismanaged. Her legal representative said: "On the contrary our client has worked tirelessly in the face of constant funding pressures and ensured that Broken Rainbow could continue to operate for many years.”

Two other, concurrent investigations into Broken Rainbow are ongoing, the report said: one by the Charity Commission and the other by the insolvency practitioner. Depending on the conclusions of these probes, various further action could be taken against the charity and its staff, including preventing them from being trustees or directors of any other charities.



The insolvency practitioner could also “recover funds through the courts from either the trustees or the former CEO if it considers that they have acted illegally”, the report said.

The main findings of the NAO report on the regulatory failings over Broken Rainbow are:

· The Home Office failed to monitor the grants it gave.

With no annual reports ever received and patchy performance data supplied by the charity, “the Home Office did not have even the very limited information required on its monitoring forms, which in any case fell short of the requirements set out by the grant agreement.” In a parallel with the Cabinet Office's handling of Kids Company, the NAO said the failures of the Home Office to oversee the charity prevented it from being able to “detect failure and early warnings of it”.

· No one in government knew exactly what was happening, despite the government being its biggest funder.

“Many different parts of government had some information about Broken Rainbow’s difficulties, but none had the complete picture," the NAO found. This meant that when Companies House published its intention to close the charity in March 2016, the Home Office had no idea, and “signed a grant agreement in April 2016”. During this period there were “several different bodies engaged with the charity, unaware of the other interventions taking place and of how close Broken Rainbow was to closure."

· The monitoring that did take place ignored the warning signs.

Despite the charity spending “13 times more than planned on travel and subsistence, four times more on staff salaries and three times more on software”, the Home Office “considered that no monitoring reports provided by the charity raised concerns about its solvency”.

· The information the charity provided the Home Office showed its failures but still this did not prompt action.

“Where data were included, they covered the number of calls to the helpline and contacts made in person via the Broken Rainbow office and online email support. This did not meet the requirements set out in the grant agreement.” Meanwhile, the Home Office “did not request information from Broken Rainbow on the quality of the service provided or on any other aspects of the helpline’s performance”.

· The Home Office grant agreement was flawed.

Two versions of the most recent grant agreement were supplied by the Home Office to the National Audit Office. The first “had not been signed either by the Home Office or by Broken Rainbow”. The second “was almost a completely blank template, which had been signed by the grant recipient”. There was therefore insufficient clarity of “the purpose of funding”, with the grant holder being “unaware of its responsibilities”.

The Charity Commission, the report found, “does not have the capacity or capability to proactively monitor every charity on its register”, and “does not have the resources to review every set of accounts it receives”.