The Dunedin City Council ended the 2008-09 financial year $764,000 in the red, well down from an expected surplus of more than $18 million.
Some of that change is due to stadium-related budget issues, including the change in the way private-sector funding was gathered, and the lesser amount given for the project by the Community Trust of Otago.
But the council has received an "unqualified" audit for its 2009-10 annual plan, a tick of approval from Audit New Zealand for the council's balance sheet.
The change from surplus to deficit was signalled in a report in August, and the result will be considered by the council at a finance and strategy committee meeting on Monday, and at an extraordinary council meeting following that to adopt the audited annual plan.
Council finance and corporate support general manager Athol Stephens said the deficit came down mostly to timing issues.
The private-sector funding for the stadium was originally expected up-front, but that was changed by the trust last year to a system where payments for seating packages were made incrementally, with first payments not until 2010, after the trust struggled to get people interested in paying before the stadium was built.
The Community Trust of Otago grant was cut from an expected $10 million to $7 million after the recession hit, and while an expected 25% payment had been received, it was $1.75 million rather than an originally anticipated $2.5 million.
Another issue was a delay to New Zealand Transport Agency funding for roading.
Mr Stephens said the changes to the expected budget were in part a result of a requirement to prepare budgets so early.
The stadium budget issues had been clear for some time.
The audit did not consider some of the issues that had caused ratepayer concern, such as the level of debt the council was carrying, so the report would make no comment on them, he said.
