Ex-news anchor Edwards, 62, pleaded guilty on Wednesday to three counts of making indecent images of children, having resigned from the BBC in April on "medical advice" six months after he was first arrested.
The crimes occurred between December 2020 and August 2021, with Edwards receiving 41 indecent images of children over WhatsApp. Most children were aged 13 to 15 and one was between seven and nine.
The broadcaster acknowledged that it was "made aware in confidence" by the police that Edwards was arrested in November "on suspicion of serious offences".
He was already suspended from the BBC at the time, following allegations that he paid a young man for explicit images, which unfolded in July 2023. He remained on the payroll until he left the company in April this year.
BBC director Tim Davie said the broadcaster was "very shocked" at the details that came to light during the trial. However, Davie defended the BBC's decision not to make the November arrest public or fire Edwards since he had not yet been charged.
The broadcaster had earlier said that Edwards would have been dismissed "immediately" if he was charged while he was still employed there.
While it is not clear exactly how much the BBC knew about the allegations at the time of arrest, it did not know about the ages of the children involved.
"We knew it was serious, we knew no specifics, apart from the category of the potential offences," Davie said.
Culture secretary Lisa Nandy on Thursday questioned Davie over the BBC's handling of the scandal and the use of public funds to pay Edwards' salary.
"Obviously I am particularly concerned to make sure that people have confidence in the BBC," Nandy said.
Edwards has not commented on the allegations.
Public funds
The broadcaster is funded by a compulsory licence fee charged to every household with a television.
Edwards continued to be paid his salary of over £475,000 ($605,000) while he was suspended, which included a £40,000 pay rise in 2023-2024, one of the highest salaries at the company despite not being on air since July 2023.
Presenting the BBC's flagship 10 pm news bulletin since 2003, Edwards led coverage of key events, such as the death and funeral of Queen Elizabeth II and the coronation of King Charles III.
However his 40-year career came to an end after allegations that he paid a young man to send him explicit images, which are not related to the ongoing charges.
The BBC found failures in its complaints process in a probe it conducted into its response to complaints from the young man's family.
A current BBC employee and a former staff member have been critical of another internal inquiry which has not been made public, after they told the BBC last year they had received "inappropriate messages" from Edwards.
The BBC's brand has been built on public trust, but in recent years the broadcaster has been dogged by scandals which saw some big names revealed as serial sex offenders and reports of a culture of covering-up for its star presenters.
In 2012, the BBC was shaken to its core after revelations of its decades-long cover-up of presenter Jimmy Savile, a fixture on children's television who was exposed after his death as a predatory paedophile who had raped and molested minors for decades.
The broadcaster apologised and launched an independent investigation which concluded in 2016 that a culture of fear and celebrity deference had enabled Savile's activities.
But six years later in 2022 the BBC admitted to failing to probe claims of sexual misconduct made against BBC DJ and TV host Tim Westwood, with multiple sexual scandals involving other presenters cropping up as well.
