More than $140 million worth of land and infrastructure assets were not kept on the books of NSW councils, an audit of local government has found.
A NSW auditor-general's report, released on Friday, identified numerous "high-risk issues" at many of the state's councils.
The majority of problems identified were with councils' financial reporting, asset management and IT security.
The audit found 18 councils were running at an overall loss with operating expenses exceeding their revenue base. More than 10 had been losing money for three years.
Auditor-General Margaret Crawford found almost 40 significant problems within councils' financial reporting.
Ms Crawford said many of the financial issues surrounded the ways councils valued their assets.
The audit of 139 councils' 2016/17 financial statements found $145 million worth of land and infrastructure at 24 councils had not been recorded on asset registers or financial statements.
"We also found examples of multiple asset registers with conflicting information, inaccurate or incomplete registers and unreconciled registers," the report said.
Meanwhile, problems were found in the financial statements of 43 councils.
Half of NSW councils do not have an IT security policy, the report found, with insufficient user controls and inappropriate privileged access found at others.
Seventeen councils do not have a documented plan to recover from an IT "disaster".
