Brad Bohun of auditors Crowe pointed out the challenge after a question from Councillor Gil Kelly on whether the council is Fit for the Future.

Mr Bohun had earlier told councillors the council had returned a surplus for the year ending June 2019.

"In your opinion would you deem our council fit for the future in its current fiscal position?" Cr Kelly asked.

Cr Kelly said the financial situation Mr Bohun had presented was "pretty much a 180 degree difference" to information presented by Professor Joseph Drew who was engaged by council to present information on the boundaries review.

"My lens is one of a horizon of 12 months in a going concern setting, can you pay your debts as and when they fall due," Mr Bohun told council.

"Fit for the Future is a longer time horizon.

"I think Cootamundra Gundagai (Regional Council) along with a lot of other regional rural councils, if you've got a large road network to maintain, the current design of the funding models make it very challenging for you to satisfactory do that into the future.

"You, along with a lot of other rural councils have got a real challenge on your hands because you're not getting funded and you don't have the level of ratepayer activity in order to maintain the asset load that you've got.

"That's probably bridging the gap between Fit for the Future solvency on a horizon platform versus my lens which is saying we've got money in the bank now but what this doesn't factor in is your asset management plan coming out of your integrated planning and reporting and if periodically if you either need to fund those via debt or a special rate variation either one is going to challenge you into the future.

"That's the bit that is part what this statutory audit is saying," Mr Bohun said.

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