A damning catalogue of errors and mismanagement at Derby Wilmorton College is released today after a Further Education Funding Council enquiry into the governance of the college.

The report calls for the dismissal of all the members of the present governing body and the immediate appointment of an acting principal from outside.

The governing body was found to have failed on nine counts to provide proper oversight of the college's activities and in addition "improperly paid remuneration to nine of its members including differentiated remuneration to its chairman and vice chairman."

Andrew Stromberg, former principal, left the college in July and last week the chairman Stuart Webb and three members of the governing body stepped down ahead of the publication of the report.

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The college has been in turmoil for more than a year since management restructuring plans were announced by the principal. The report deals with allegations that he had intimidated staff, that rules had been broken over land deals and that the principal's daughter had been employed as a lecturer and his gardener and architect had been given contracts.

Mr Webb's son-in-law was given Pounds 500 to design the college's logo without tendering, and a lecturer who was made redundant began legal action after her redundancy cheque was stopped. She was reinstated after Mr Stromberg's resignation and today's report says the governing body failed to act in accordance with natural justice over the affair.

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The report says that the governing body also failed to establish effective audit machinery and to ensure that the principal was fully accountable to the governing body. The record of the governing body relating to its membership and management of its business is described as "deplorable".

The principal is singled out for severe criticism including regular breaches of the college's financial regulations to assess expenditures and lack of tendering. Appropriate steps were not taken to recruit an effective senior management team.

Michael Shattock, registrar of Warwick University, conducted the inquiry and took evidence from 66 people over the summer. He says the FEFC should disseminate the lessons of the failure of governance and management of the college to other institutions in the sector.