Scotland's councils have been warned to be careful they do not run out of cash for social care, as they offer people personal budgets to pay for the help they need.

Audit Scotland said the policy of self-directed support could transform social care over the next decade. But the spending watchdog said demand might exceed supply.

"(Councils) should take action to lessen the risks of overspending, which might mean they are unable to provide support for everyone who needs it," says a report on the policy.

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Self-directed support is expected to increase choice and control for people with disabilities or age-related needs, allowing them to choose what care they receive and how they get it.

It will radically alter the way councils spend about £2.8billion a year on social care services, requiring them to offer a wider range of options to meet people's individual needs.

The policy has already led to disputes, particularly in Glasgow, where carers and users of learning disability day centres have objected to their closure.

The Scottish Government says self-directed support (SDS) can be paid for by reallocating existing funds.

But Audit Scotland said there was a risk prices would rise as charities and others offering help and support to people in their homes and communities had to deliver more personalised care.

Councils will have to plan how they will allocate money to all those eligible, as demand increases, the report says. "They should have plans for how and when to stop spending on existing services if too few people choose to use them."

While all councils have had to offer SDS since April, Audit Scotland says progress has been patchy.

Auditor General Caroline Gardner said: "The Scottish Government has given £42 million to help councils and other organisations prepare for self-directed support. It needs to have a strategy to measure and report on what this spending has achieved."

The Royal College of Nursing said there were questions about the vetting of people employed using SDS. Theresa Fyffe, the union's Scotland director, said: "How is a nurse to ensure a personal assistant paid for by SDS providing some nursing tasks is adequately trained and supervised?"

She also said nurses had concerns about cuts.

Ms Fyfe said: "Local authorities may have to make difficult decisions to stop providing existing social care services, such as respite care, if they become unsustainable as people opt for other services under SDS.

"However, there will be some people who will want those traditional services and may end up falling through the gaps. How can the NHS and local authorities work together to stop people falling through such gaps?"

Councillor Peter Johnston, health spokesman for the Convention of Scottish Local Authorities, welcomed the report and said councils faced challenges in implementing SDS against a background of cuts and rising demand.

"The report acknowledges it will take time for councils to shift spending away from traditional services, towards giving people individual budgets, and the report's focus on examples of good practice in this areas is welcome," he said.

Glasgow carer Tommy Gorman, a campaigner against the closure of day centres in Glasgow, called for ministers to commission independent research on the experiences of those receiving SDS.

He said: "For some categories of vulnerable adults choice has effectively been removed from the social care agenda with little regard for the impact on the people who depend on these services or the families who support them."