Shetland Islands Council 'making good progress'
Shetland Islands Council has made some good progress after concern was expressed, Audit Scotland has said.
The Accounts Commission last year said the local authority had "serious problems" and needed to change.
That report said the council had problems with leadership, financial management and accountability.
A new report has said the council had taken prompt action to address issues, although some aspects of financial management remained a concern.
It said the council was moving in the "right direction" and there was a "clear commitment to improve".
Council chief executive Alistair Buchan said the report showed that Shetland was now "forging ahead," and the challenge was "to keep up the momentum".
It followed a controversial pay-off to the council's former chief executive last year. David Clark left with a tax-free golden handshake of about £285,000.
Dozens of people took to the streets of Lerwick to protest over the handling of Mr Clark's departure after his nine-month spell in the job.
The Accounts Commission held a two-day public hearing into the affair.