Tertiary Education Minister Steven Joyce yesterday defended the rating as appropriate as it placed the school in Category 3, the second-lowest of four categories, meaning it would face further monitoring.
The assessment had taken other factors into account, such as the views of employers, universities and other educational institutions which dealt with AWI's students.
AWI executive assistant Debbie Thackeray said the 16 standards the school submitted for checks were only a tiny fraction of the credit value of the courses. She said the standards had not failed - they had simply not passed and needed to be modified.
However, Languages International chief executive Darren Conway, who has persistently criticised NZQA for failing to crack down on systemic failure in the international student market, said the results "aren't just bad, they're disastrous".
He said it looked as if NZQA had been about to pass the school when the late results came in and had tried to rewrite the report without changing its overall decision.
One source familiar with the school said the results were undeniably bad but the school was actually losing students because it refused to "give out free passes", unlike many of its competitors.
Two polytechnics associated with the report also took issue with its findings.
The report says the school has lost its contract with Nelson Marlborough Institute of Technology (NMIT) to offer business degrees and diplomas and that Auckland University of Technology (AUT) has begun monitoring computing students it has accepted for degrees.
However, NMIT said it was still offering degrees and diplomas through AWI. AUT said it had no specific agreement to take students from AWI and no record of students using cross credits from the school to enter its courses.