Catering giant Compass has revealed an inquiry has confirmed "serious irregularities" in the way United Nations contracts were awarded.

A three-month inquiry by the group into the relationship between its Eurest Support Services unit and the UN concluded that problems were limited to a few individuals.

Compass yesterday pledged to tighten its internal controls to ensure managers were supervised more closely and had less freedom to make decisions alone.

The inquiry related to the way contracts were awarded to ESS by the UN, although no further details were given due to an ongoing criminal inquiry in the United States.

Three managers were fired during the inquiry, but Compass said there was no evidence of any wrongdoing elsewhere in the group.

Steve Lucas, chairman of the audit committee who oversaw the investigation, said: "This has been a highly regrettable episode for Compass Group. However, we have now concluded a very thorough investigation and taken appropriate and decisive action.

"We have no reason to believe that the issues extend to any other part of the group."

The investigation looked into the relationship and contract procurement procedures between ESS, the UN and IHC, a former contractor and vendor to the UN procurement department.

It was overseen by Mr Lucas and carried out by legal firm Freshfields and auditors Ernst & Young.

On October 21, the UN suspended Compass as a registered vendor following allegations that ESS improperly obtained confidential information concerning a three-year contract to supply food and water to UN peacekeepers in Liberia.

A few weeks later Compass dismissed the head of its UK division and two other employees and said it would restructure the management of ESS and reduce the autonomy within the business while increasing central control.

It said it was co-operating fully with the UN.

IHC's relationship with the UN and ESS is also part of wider probe into UN procurement being conducted by the Office of the US Attorney for the Southern District Court of New York, the US Congress and the UN, Compass added.

The latest findings came as Compass continues to seek a new boss to replace chief executive Mike Bailey.

Mr Bailey intends to leave his position when a replacement has been identified. A spokesman said the move was unrelated to the controversy.

However, some critics have said the chief executive must go if the company is to limit fall-out. A number of names of possible successors have been floated by analysts, among them Birmingham-born Gary Green, chief executive of Compass's Americas Division.

The firm expects to announce the appointment by the end of March.