Police authority chiefs last night refused to comment on claims they were warned of cash problems years before a £7.3m financial "black hole" was discovered.

Reacting to news that warnings were issued by the Government's Audit Commission watchdog as far back as 1999, chief executive Joe McCarthy would not elaborate.

He said: "It is very disappointing if a draft version of the report has been leaked because we have received clear legal advice that, because of other issues surrounding the force's financial shortfall, it would be improper for the report to be published or for the authority to comment on it at this stage."

The report reveals that the Audit Commission repeatedly warned Cleveland Police that its cash reserves were too low.

The 7.3m budget shortfall derailed plans for 200 extra police and community support officers.

A Cleveland Police spokesman said it would be inappropriate to comment.

However, according to the police authority, tighter budgetary controls have been installed to combat the hole in spending plans for the coming year.

While the long-awaited Commission report into the events leading up to the cash crisis at the force has been delayed, the authority has had to fine tune its budget plan.

An apparently clearer and more user-friendly draft budget statement was welcomed by members, who are keen to avoid a repetition of the scandal that rocked the force when it erupted in February.

The £118m draft budget was agreed by the committee.

Speaking at a meeting at police HQ in Middlesbrough, magistrate member Alf Illingworth said: "It's a document that has been long overdue and it is something I will get comfort from in the way the budget has been produced."

Mr McCarthy said: "It has established that the lesson has been learnt. It is a massive step in the right direction."

Authority chairman Councillor Ken Walker urged caution, saying: "We are moving in the right direction but as we move down that road we need to ensure the information does come and we ensure we are satisfied our resources are being used properly and the level of expenditure is being monitored."