Staff at the daycare centre photographed multiple injuries and questioned Barriball, but did not alert authorities to the suspected abuse occurring at home.
Abbey's Place was placed under a provisional license by the Ministry in May after a visit from Ministry staff.
Conditions of the license included providing evidence of a formal review of the failings in Malachi's case, educating staff to identify and respond to suspected abuse and ensuring a procedure was in place to alert the daycare manager of concerns.
In a statement, the Ministry's Deputy Secretary Central Jocelyn Mikaere said an investigation found the conditions were not met.
"We have contacted all the parents and are supporting them to enrol their children at a new service," Mikaere said.
In June, Barriball was sentenced to a minimum of 17 years imprisonment. Malachi had been in her care at the request of his mother, who was in prison.
According to the summary of facts, Malachi was dropped off at the centre last September. His hairstyle had been changed, with his fringe pulled over his forehead.
Under the fringe was large swelling. He also had a black eye, bruises and a scratch under his chin.
Barriball was spoken to by staff at the daycare, where she explained Malachi had fallen twice off his bike.
The daycare staff later asked Malachi if that was the case. He said no. As staff attended to his injuries, he told them Barriball "would be mad" at him.
The daycare failed to alert police or Oranga Tamariki of the suspected abuse, and photographs of the abuse weren't discovered by police until after his death.
High Court Justice Paul Davison, who sentenced Barriball, said there were "clear lessons" from the child's death.
"The tragedy of Malachi's death provides some strong and clear lessons to everyone involved in the care of children," Davison said.
"In the circumstances of this case, it appears there were a number of adults who observed Malachi showing signs of suffering injuries, which they suspected might have been deliberately inflicted.
"Malachi was also suffering the effects of malnutrition," the judge explained. "It would have been apparent to those close to him.
"Unless responsible adults are prepared to speak out and contact the police, the opportunities to prevent further trauma or damage to the child are lost.
"This is a community responsibility, and leaving it to others to act can so easily lead to tragic consequences such is the case here."
