Students are being awarded top grades on weak vocational courses that leave them with little knowledge of business, inspectors warned today.
In a damning report, Ofsted condemned vocational business qualifications which fail to develop pupils' understanding and skills in the subject.
And the inspectorate raised concerns that business courses which are examined through internally set and marked assignments are seen as equivalent to GCSEs.
The report, which looked at economics, business and enterprise education in schools and colleges, found a "serious problem" in 30 of the 39 schools inspected for vocational business courses.
Despite students achieving good results, the quality of their work was weak, it found.
Some lessons focused too much on completing narrow written assignments that gave students little opportunity to debate issues, extend their thinking and develop a broader understanding and skills in the subject.
"Despite good results, the quality of students' work, their knowledge and understanding, and their ability to apply learning to unfamiliar contexts and to demonstrate higher-level skills, were often weak," it said.
"This was because of the rather narrow and simplistic approach to the identification of assessment criteria that was common on such courses, and the fact that assignments were designed only to ensure that students were able to demonstrate these criteria in their written submissions."
The report added: "Evidence from lesson observations, scrutiny of written work and discussion with students brings into question the case for claiming that such courses are equivalent to between two and four single-award, traditionally examined GCSEs at Key Stage 4."
Ofsted chief inspector Christine Gilbert said: "Vocational qualifications provide a valuable route to employment and further study for many learners.
"However, the report highlights the need to review the equivalency of vocational business qualifications that are assessed wholly or mainly by internally set and marked assignments with more traditional GCSEs and A-levels."
The report comes just weeks after Education Secretary Michael Gove announced plans to reform vocational education.
Under the measures 14-year-olds will be given more opportunities to study at college rather than school, and league tables will be overhauled so that only vocational qualifications identified as high quality are likely to be included.
Outlining the reforms, Mr Gove warned that the "dumbing down of the past has got to stop" and said the Government was taking "immediate steps to rebuild the currency of vocational qualifications".
He told MPs that he would be accepting all of the recommendations laid out in Professor Alison Wolf's review of vocational education, as he insisted that schools should not be allowed to push pupils into "easy" subjects to boost their league table rankings.
It has previously been suggested that up to a third of vocational qualifications are of low quality.