The Dáil Public Accounts Committee (Pac) is examining proposals to expand its remit and that of Comptroller and Auditor General John Purcell to cover local authorities.
It follows a report by the Pac detailing how the independent auditing of two local authorities failed to identify financial errors totalling €16 million.
The discovery of the errors, relating to the repayment of housing loans, was highlighted by the comptroller during an audit of the Department of the Environment.
Mr Purcell identified that Kilkenny County Council had failed to pass on €10 million worth of loan repayments on local authority homes back to the Department of the Environment, as required. Donegal County Council made a similar mistake to the tune of €6 million. Both councils have since repaid the money.
The mistake was included in the latest report by the Pac, which highlighted errors and spending issues covered during hearings in late 2003 and early 2004. These also included the trebling of costs of a computer project in the Forestry Service to €15 million.
Pac chairman Michael Noonan said the project raised questions about management. During the period of the project, the Forestry Service decentralised to Wexford and lost all of its computer staff, along with a significant numbers of staff with experience in administering and implementing such projects.
Other issues highlighted was €1.3 million the Department of Enterprise had to pay back to companies in reimbursed fines for late registration, after it failed to introduce the regulations in time.
Pac deputy chairman John McGuinness said the problems highlighted the need for new auditing procedures for county councils.