According to the document, three of the 12 sheep were used in an inhalation experiment before they were killed.
Participants described the sheep as "near death" and in poor condition, with the investigation finding it was questionable whether they were fit for transport.
They were fully conscious when their throats were slit, despite there being no learning objectives in the course for killing animals.
The rationale given for killing the sheep in this way was to prepare students for situations in the field where killing of an animal was required and there was no gun, captive bolt gun, sedation available.
Animal Justice Party MP Emma Hurst has accused the DPI of a "failure of effective self-regulation" by allowing the course to go ahead in its facility.
She said it was "shocking" the course had been allowed to continue for so long and that it appeared the department took "no real disciplinary action" following the investigation.
The Animal Justice Party – which holds two upper house seats in NSW – is calling for an inquiry to investigate the use of animals in experimentation.
"Animal experimentation is one of the most hidden of all animal-use industries in Australia, with virtually no transparency or accountability," Hurst said.
DPI director general Scott Hansen last month played down the department's involvement in the sheep killing incident, telling a parliamentary hearing the training course was delivered by the universities.
"The University of Sydney and Charles Sturt University were not only course content owners but also it was delivered by their staff," he said.
"We provide facilities for them to utilise at the Elizabeth Macarthur Agricultural Institute."
He acknowledged that investigations by the DPI and theUniversity of Sydney animal ethics committee both found there appeared to have been no animal ethics approval for the course.
"The course leader was immediately suspended and prevented from engaging in further animal research pending the outcome of the university's investigation," he said.
He said the DPI's investigation found there had been a "breakdown in internal systems" and the two universities had independently investigated and taken disciplinary action against their staff.
"They have given the (DPI) Animal Research Review Panel the outcome of those investigations and the steps they have taken to prevent similar incidents from occurring in the future," he said.
A DPI spokeswoman said the course was discontinued following the incident and that the department stood by Hansen's comments.
A University of Sydney spokeswoman said the incident involved a pathology training programme for practising veterinarians not university students.
She said some of the sheep from the training programme were used in a research project involving the inhalation of a potential anti-cancer compound through a nebuliser.
"Smoke inhalation was not part of the project, and our investigation found no evidence of the sheep being adversely affected by the nebuliser process," she said.
She said the university was extremely concerned when it was made aware of this situation and immediately launched an investigation.
"We have taken steps to prevent similar issues occurring in the future which includes further strengthening our governance and oversight of research and teaching activities that involve animals and enhancing the training we provide to our staff, students and affiliates who will be working with animals," she said.
CSU was contacted for comment but the university was unable to provide a response by deadline.
