The Tour de Yorkshire saw organisers left with losses of more than £1m in the last financial year - the vast majority due to poor sales of official merchandise.
Welcome To Yorkshire (WTY) , the tourism agency, predicted a small profit in 2014/15, but accounts show that £750,000 of unsold Tour de France merchandise, brought in to plug a widening funding gap, was partly to blame for an actual lost of £1,031,515.
Bosses became aware that the finances were not looking good as the year continued, bringing in the accountancy firm KPMG.
In a report produced privately for WTY, KPMG said that an extra £600,000 of merchandise - including Tour de France T-shirts, mugs, pens and badges - was ordered, but poor sales meant a quarter of a million pounds worth of it was left after the race.
Selling it off cheap has not proved effective either, and in January WTY still had £500,000 worth of it left.
WTY owes Tour organisers Amaury Sports Organisation 310,000 euros for marketing expenditure which is due to be paid before December 31 this year.
It all led to a conclusion by KPMG that WTY's financial management was "not as strong" as it used to be, according to the Northern Echo.
Councils in North Yorkshire will donate £200,000 to WTY to help its finances - on the understanding that it can stick to its budget going forward. They will hand over the final third of these payments early next year.
However, Richmondshire district Councillor Stuart Parsons described the WTY's financial situation as “astounding".
He also highlighted the fact that WTY chief executive Sir Gary Verity will be paid almost £210,000 in 2015/2016.
"I appreciate we have to promote Yorkshire but this should be done within our means. The report is a great shock - I didn't realise it was that bad."
"If [Verity] had taken a 25 per cent cut as a gesture to reestablishing financial viability that would have been a good start."
A spokeswoman for WTY said: "This year’s Tour de Yorkshire brought 1.5 million people out around the county, with many local businesses seeing large increases in profits. Yorkshire remains in the national spotlight and just last week was shortlisted in VisitEngland’s search to find the country’s Home of Sport.
"Latest statistics show that visitors to Yorkshire are up almost a quarter on 2014. Welcome to Yorkshire will continue our work to make Yorkshire a place that people around the world want to visit.”
Earlier this month we reported how British Cycling has rejected a request for the 2016 Tour de Yorkshire to become a four-day race. The race will therefore remain a three-day event and will be staged over the Bank Holiday Weekend next May.
Welcome to Yorkshire’s chief executive, Gary Verity, said last month that the plan was for the 2016 race to feature two hilly stages and two flat stages. He said he was disappointed that British Cycling’s decision meant that this would not be the case.
“We’ve nothing but the highest regard for British Cycling with all that they have achieved over the last few years, including their record in delivering Great Britain cycling medals. However, we are disappointed by the decision of the British Cycling Board not to support our plans for expansion of the Tour de Yorkshire next year.
“Following the great success of the inaugural Tour de Yorkshire we have had huge support for our plans to grow the 2016 race; from professional cycling teams, broadcasters, local authorities, the people of Yorkshire and even the Prime Minister.”
British Cycling said that the decision was partly made based on UCI calendar reforms expected towards the end of the year. The organisation feels these will need to be understood before committing to any changes and also said that four months after the inaugural even was ‘too soon for the meaningful analysis needed to reframe a four-year agreement.’
The organisation was also keen to stress that professional racing was not the sole key to promoting cycling in the region. “A stage race for professional road cyclists – regardless of whether it is three or four days – will not on its own sustain the wider impacts and benefits for cycling needed for the transformation of cycling in Yorkshire and to which Welcome to Yorkshire has committed.”