The report lists a number of recommendations including an improvement in the Board’s risk assessment procedures.
The shortfall in fees results from the five years from 1994/95 to 1998/99 and are intended to cover the costs of the Board.
Costs generated by the Board are supposed to be recovered in their entirety through fees levied on the industry.
The board traditionally recruits inspectors from among fromer polcie officers but the NAO says it needs people with wider skills, incuding accountancy.
Sir John Bourne, head of the NAO, said: ‘The Gaming Board has taken steps in recent years to improve the way it regulates the gaming industry but could achieve still more with a lighter regulatory touch.
‘Better risk assessment, together with more us of the regulatory work already being done by the major operators, would enable the board to reduce its routine inspections.’