Welsh tree chiefs took up the slack in addressing a need to provide clearer corporate direction, said the report published on 17 January.
The auditor general for Wales found clear strategic priorities were well supported by a stronger corporate culture and united staff.
The report, which followed one five years ago, found the group had improved its core processes such as procurement and managing grants and risks.
It was also making good progress in meeting the expectations of its commercial timber customers.
Forestry Commission Wales Director Trefor Owen said, "I welcome this end of term report that recognises the significant business and delivery achievements by our loyal and hard working staff since 2008.
"As a learning organisation we aim to put in place a number of the improvements before we transfer to the Welsh Government and Natural Resources Wales on 1 April 2013."