Speaking to leaguemanagers.com, Barnwell said: "Peter has obviously been in touch with us off-and-on for the last few months. It's been a very uncomfortable position for him.
"It's been a public discussion between the board and the new chairman whether they were going to keep their manager or not, and working under incredibly bad circumstances was bound to filter in to the rest of the football club. I've never known such a public situation in such a big football club.
"But Peter was brought in to salvage what was left of the wreckage, knowing that there was very little money there, but what he found out was far worse than he been told; as they say: it was not like the brochure.
"You can only deal with what's in front of you and he did keep them up, one could say he managed what was a mammoth task to keep them up and not only could he not bring players of any quality in, he had to get rid of players to help redress the financial situation.
"So it was a very difficult position and one that he could not achieve; it was impossible, and the whole club would appear to be switched off. So you can only sympathise with Peter, he did the best he could, and another manager, unfortunately, has been dismissed.
"What kind of person can come in there as a manager? It needs an experienced hand but will they put their reputation on the line for something that looks almost impossible to turn round?
"When you change managers, in a lot of cases, there is an uplift, like in any business when there is a change, simply because there is a different voice but eventually it steadies down again and then it starts to slope away and they're worse off than when they started.
"Here we've got Leeds United having paid very big compensation to two managers, and they're going to have to settle with Peter Reid at some stage, and that's money that has just been thrown away, and they're worse off.
"So the appointment procedure is flawed and you have to ask who is making the appointments, and you still see the same people there."