The ashes of baby Timothy Mol, lost from Norwood Park Crematorium, have been unable to be found, a "damning" investigation has revealed.
But two other families, concerned their babies' ashes had also been lost from the same crematorium, have been reunited with their children's ashes.
Transport Canberra and City Services on Friday released a report of an investigation into the lost ashes, which related to a children's niche wall that was relocated in 1992 to the current children's court wall.
It said the crematorium was yet to provide final letters to all families outlining the outcome of each case and that it lacked policies about the documentation of ashes.
But in its response, Norwood Park has maintained the memory of Timothy's family "is somewhat hazy" and could not be certain that the ashes were previously not taken by a member of the family.
Canberra man Eddy Mol sparked the investigation when he discovered the ashes of his son Timothy were missing.
His ex-wife's last wish before she died was for Timothy's ashes to be scattered at Mount Kosciuszko.
But when he contacted the crematorium to retrieve his son's ashes he was told the ashes could not be found.
After Mr Mol went public with his story, the other two families came forward.
The ashes of Claire Falvey, who was stillborn in the 1970s, have now been located, while another family - who wish to remain anonymous - have been reunited with the ashes of their baby.
The report said the auditors were not able to confirm through records that Mr Mol's son's ashes were ever interred.
Member for Ginninderra Tara Cheyne, who first raised the issue at annual report hearings last year, said the report was damning and devastating.
"Norwood has approached the ashes of their loved ones in some cases in a cavalier way," she said
"Particularly around the lack of procedures in terms of the management of the ashes and how they have managed complaints.
"I particularly welcome the recommendations in the report today which stress that Norwood must document its procedures around the matching of ashes and around the complaints handling so that no families go through this again."
The non executive director of Norwood Park, Fraser Henderson, said in hindsight, he recognised the crematorium may not have adequately dealt with the concerns raised by the three families.
He said letters would be sent to each family outlining the outcome of each investigation.
Mr Henderson also claimed it could not be certain that Mr Mol or a family member did not remove Timothy's ashes.
The audit recommended Norwood Park contact families who were not contactable in 1992 when letters were sent out informing families of the relocation of the children's niche wall.
In a letter to Transport and City Services, Mr Henderson said he would like to discuss the "potential suffering [caused by] contacting the person whose letter was returned ... some 27 years after the event".
Ms Cheyne said Mr Mol's bravery in coming forward had changed the lives of the two other families who found their children's ashes.
"I think we need to remember this has been a period of 40 years of heartbreak that has been exacerbated by some of the inactions of Norwood," she said.
"It was Eddy that came forward with his story about his son Timothy ... it is his bravery and courage in telling such a personal story and bringing that to the attention of myself, the media, and the directorate, that also allowed some other families to come forward."
- Clarification: This story has been amended to reflect that Timothy's mother was Eddy Mol's ex-wife.