The contractor, Smartty's Management Limited, has been asked to return the excess payment, the government said.
On Wednesday, Transport Minister Dzifa Attivor resigned following a public outcry over the deal.
Ghana is struggling with a large budget deficit and a widening public debt.
The branding involved respraying the 116 imported passenger buses and adding portraits of the current President John Mahama, his three immediate predecessors and Ghana's first head of state, Kwame Nkrumah.
A proper procurement method was "not followed and the contract did not ensure value for money," the government said after a review by Attorney General Marietta Brew Appiah-Opong.
Opposition and anti-corruption campaigners have raised concerns over the amount spent, which they said was far too much, forcing the presidency to set up an investigation.
The BBC's Sammy Darko in the capital, Accra, says many people think the government is not doing enough to tackle budget mismanagement.
They want to see people being charged for causing financial loss to the state, he adds.
Mrs Attivor's resignation is the first by a Ghanaian minister in more than a decade and comes amid efforts by the government to cut spending as it implements a three-year International Monetary Fund plan to restore fiscal stability.
Earlier this week, Mr Mahama banned public officials, including ministers, from first class air travel and he suspended non-essential trips.

A report urges European aviation safety officials to take immediate action to ensure Super Puma H225 helicopters are safe.
The Norwegian Air Accident Board warned that current fault detection measures may be inadequate.
Iain Stuart from Aberdeenshire was among those killed in the crash.
Mr Stuart, 41, from Laurencekirk, worked for the oil field services company Halliburton.
The Airbus Super Puma was travelling from the Gullfaks field to Bergen when it crashed near the small island of Turoey on 29 April.
A preliminary report issued by the  Accident Investigation Board Norway (AIBN) said it had found "features strongly consistent with fatigue" in parts of the main gearbox (MGB).
It added: "It cannot be ruled out that this signifies a possible safety issue that can affect other MGBs of the same type.
"The nature of the catastrophic failure of the LN-OJF main rotor system indicates that the current means to detect a failure in advance are not effective."
The Super Puma H225 helicopter is currently grounded in the UK and Norway but the manufacturer Airbus has lifted a recommendation that flights be suspended worldwide.
Airbus said at the time there was no evidence to link the crash with two previous incidents in Scotland involving the same model of helicopter.
An online petition calling for all Super Puma 225s to be "permanently removed from service" has attracted nearly 30,000 signatures.
Ghana has demanded a $500,000 (£350,000) refund after its transport ministry spent $1m to paint more than 100 buses with portraits of the country's recent leaders.
[NEXT_CONCEPT]
Air Accident investigators have found signs of metal fatigue in the gearbox of a helicopter that crashed off Norway, killing 13 people in April.