However, Mayor Clive Geddes said the council "chose not to" review the projections so the community would understand the challenges the district faces.
He added the projected debt levels would be reviewed in the next long-term plan.
In a report presented to Parliament last Friday, the OAG said "prudence issues" relating to the size of the council's debt prompted it to place a qualification on the plan.
"The QLDC was unable to resolve its funding issues and the OAG maintained the audit qualification on the Statement of Proposal for the final LTCCP (Long Term Council-Community Plan).
"The council is affected by the need for significant infrastructure renewal and new development to respond to the district's growth. The council signalled in its LTCCP that it did not have enough funding sources available to it to fund the capital expenditure needed for the 2009-19 period."
However, the council had "clearly stated" the debt level was "not a realistic proposition" and it would review the funding strategy and capital programme before starting the 2012-22 long-term plan process, the report said.
The Tauranga City Council also received a qualified audit opinion, but it had reviewed its draft financial forecasts and as a result the qualification was removed.
Mr Geddes said that was something the QLDC deliberately chose not to do.
While the OAG said Tauranga's debt forecasts "remained high", peaking in 2011-12 at 13% of total assets, the QLDC's interest expense as a proportion of rates reaches its highest level of 29.5% in 2018-19.
The QLDC showed in its 10-year-plan, completed about two years ago, all of the debt needed for the period, which would require capital works expenditure of between $700 million and $800 million, Mr Geddes said.
"What that showed, was in about year four or five of that 10-year-plan we were starting to breach some of our self-imposed limits around debt ratios ...
"We knew that and we understood it, we had the opportunity to review it and we deliberately chose not to.
"We felt the community should understand the debt challenges ahead of the council. We have been conscious of the fact that the debt level in our long-term plan was not sustainable.
"We felt we had to put in front of the community what the capital works programme was and the debt required to fund it, in the full knowledge it would attract that audit tag."
The council then formed a working party, comprising Mr Geddes, Vanessa van Uden, John Mann and John S. Wilson, to go through capital works projects planned for the next 10 years, aiming to "get that affordable".
The working party had "tested all our capital expenditure" and over the past 12 months had "saved out of the debt profile" more than $100 million, he said.
"What we have got to try and do is establish what the cost of a project is in nine years time.
You put a relatively large contingency on that cost ... we have been looking very, very carefully at the process ... and we have made some big changes, the net effect is to reduce the cost."
A report was expected to be presented to the next full council meeting on October 6.
