Ross was appointed to the board of the London 2012 organising committee by incoming Mayor Boris Johnson, with a remit to monitor the build's progress.
According to Ross: "The illiquidity of the banking system and falling house prices have had serious implications for the original arrangements between the ODA and Lend Lease, the developer of the Olympic Village Project.
"Lend Lease is currently having difficulty in both securing the private finance necessary to finalise the transaction and in determining what additional funding is required to make the project viable," he says.
Ross' assessment of Olympic village progress is so poor, he expects a £250M loan made to Lend Lease to be 'unrecoverable'.
"There now must be a major risk to the recoverability of the existing assumed £250M receipt. Assuming further public sector investment needs to be made there must also be a serious risk surrounding its recoverability."
However, for the remainder of the site, Ross says progress has been good so far, for example, despite with costs for the stadium and other structures rising, the money has been clawed-back through other effeciencies.
"The rise in the venues budget has been offset by savings achieved or forecast elsewhere in the programme which mean there has only been a very small increase in the overall anticipated final cost of the total programme of £16 million," he said.
But he warned that the ODA must keep
"Containing cost pressures and avoiding further calls on the contingency will be difficult and require sustained effort to manage contractors effectively and to identify and realise cost opportunities across the programme.
"This process must be overseen from the top by the Olympic Board on the basis of the best possible information and I am aware that you have already written to the Olympics Minister to make this point," he said.
London Mayor Boris Johnson said: "Like me David believes that the Games will be a huge success and a wonderful thing for this city and this country and his report recognises the excellent work already undertaken.
"However he highlights some important issues including how important it is to have greater transparency and openness about cost forecasts for the Games than has been the case so far and I want to take this opportunity to reaffirm that Londoners will not pay a penny more council tax to pay for the Games – no matter the circumstances.
"We must also not lose sight that the Olympic Village offers the hope of new homes for many thousands of people. We cannot put that at risk by reducing the quality of these homes and indeed I want to see this village as a model for new housing sought after by people of all incomes - a mixed community with excellent schools and facilities with as much shared ownership as possible to give people a ladder to home ownership."