The LGA review was commissioned by the city council after its troubled financial position came to light last autumn.
Leaders have said the 2021 cyber attack, poor investment performances and higher interest rates on borrowing have all contributed to its fiscal situation.
LGA investigators found the disruption of the attack and staff turnover have undermined the department’s resilience, and confidence in the finance team is “particularly low”.
The review describes the department as a “collection of ‘unsettled’ individuals rather than a team”, which have been “stretched thin” for the past three years.
It highlights five areas which need “urgent” attention, including a new internal structure, improved processes, better performance management and an overall change to culture.
Head of Finance and Resources at the council, Alison Turner, said staff have shown “real commitment in challenging circumstances” and the authority is now “focused on giving them the structure, support and tools they need to succeed”.
Jon McGinty, Head of Paid Service, added: “We are now taking decisive action to put the right structures, systems and leadership in place, creating a more resilient, proactive service that supports the whole organisation.”