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The previous owner fitted a cheaper exhaust on our e46 318i only 8 months ago , car drives smooth with no issue, but I am wondering weather the cars computer doesn't recognise it

Vehicle: 2006,BMW,318i convertible, 2ltr

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HI there

If there is no converter on it then it would cause it. Otherwise the catalytic converter is not cleaning the exhaust as it should. This will give you the converter code. Most cases the aftermarket exhaust doesn't affect the converter because it's AFTER the catalytic converter. it is possible if there is an exhaust leak it could cause this or a bad rear O2 sensor. But usually the converter itself is the problem.
by (100 points)
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Thankyou for your advice Cargut1

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