The Victorian Building Authority has launched an investigation into LU Simon Builders after the MFB revealed on Monday that the external cladding of the 23-storey Lacrosse Building was untested and had "contributed to the spread of the fire".

The cause of the blaze in the early hours of November 25 was revealed to be an unextinguished cigarette on a sixth-floor balcony, which spread to a plastic container, a timber table top and a nearby air-conditioning unit.

Fast-running flames soon ignited external wall cladding and aided by "combustible material located within the wall structure" quickly spread to the top of the building, the MFB reported.

The MFB called on the City of Melbourne to push for a review of the Building Act and regulatory framework in the wake of the incident.

Resident John Wong – who was only able to return home in April – said the report's findings were a "relief" because many who witnessed the blaze believed it had spread too quickly.

More than 100 owners and residents have contacted law firm Slater and Gordon regarding a potential class action.

"It was obvious that it wasn't quite right how quickly the fire propagated and moved up the floors within minutes," Mr Wong said, adding that he would be attending a meeting hosted by the City of Melbourne on Monday afternoon.

MFB chief fire officer Peter Rau said the building's external cladding, Alucobest, had undergone scientific testing and was found in breach of combustibility requirements for a high-rise building.

"The external cladding material on this building did not prevent the spread of the fire, as required by the building code," Mr Rau said.

LU Simon managing director Peter Devitt said aluminium composite panels including Alucobest had been widely used in Australia for decades. He said the cladding complied with Australian standard tests for ignitability, spread of flame, heat and smoke.

But in 2010, when the building was commissioned, there was no such product that passed the test for "combustibility", he said.

Ben Hardwick, of law firm Slater and Gordon, said legal action potentially worth tens of millions had been on hold awaiting the outcome of the MFB investigation.

"Owners and residents of this building are rightly asking how an occupancy permit was ever issued for this building," he said.

"They now face the prospect of not only having to deal with the fall out of the fire but will be faced with costly rectification works to replace the external walls to the building."

He said whoever was responsible for issuing the occupancy permit in 2012 would "certainly have a number of questions to answer".

High occupancy rates in the La Trobe Street apartment tower and excessive amounts of combustible material stored on balconies were also found to have contributed to the spread of the fire.

Victorian Building Authority technical and regulation director Jarrod Edwards said the new investigation would probe the conduct of LU Simon Builders and the building surveyor.

Mr Edwards said investigators would try to identify whether the non-compliant external cladding had been used elsewhere.

Mr Devitt said other factors were to blame for the ignition and rapid spread of the fire, including an absence of sprinkler systems on the balconies.  He said planned balcony sprinklers had been removed by fire authorities prior to LU Simon's involvement in the project.