The embattled Coober Pedy Council has “no realistic prospect” of balancing its books because of its “unsustainable” debt levels and financial performance, Auditor-General Andrew Richardson has found.

In a 148-page report tabled in State Parliament yesterday, Mr Richardson said the council’s $6.7 million of outstanding loans had been mainly entered into to fund past deficits.

His findings concerned Local Government Minister Stephan Knoll, who is considering whether to appoint an administrator to oversee the council.

Mr Knoll said the new council had until Thursday next week to provide him with any submissions before he decided whether an administrator should be appointed.

“Any decision to recommend that a council be declared defaulting and that an administrator be appointed is a very serious one,” Mr Knoll said.

Mr Richardson found the council had not demonstrated the capacity to increase its profits to pay off the debt.

“In my view, the council’s debt level is unsustainable and has a significant impact on its financial sustainability,” he said.

Mr Richardson also found the council’s “inadequate” financial performance led to it reporting budget blowouts between 2011 and 2016 and it had “significantly deficient” accounting systems and records.

“There is no evidence the council considered the impact of these losses until it was in financial crisis,” he said.

Mr Richardson’s scathing attack on the council’s financial management comes four months after Ombudsman Wayne Lines found it had committed one of the “most serious examples” of maladministration when it signed a $198 million power deal.

The council said it accepted the Auditor-General’s findings but had instituted a range of measures to turn around its financial performance.