Finance experts have called on the Government to explain how changes to the business rates retention system next year will work.
The Chartered Institute of Public Finance says more work is needed to make sure the reform is successful.
From April next year councils will keep 75% of the business rates they collect to give them greater control of money raised locally.
The local government ministry has been seeking views on how risk and reward can be shared under the new system and how best to set it up.
CIPFA says current funding for local government is insufficient to meet growing demand and it is worried a number of authorities are experiencing financial instability.
It says the latest shakeup will mean greater fiscal devolution but must be properly managed.
Joanne Pitt, CIPFA policy manager, local government, said: 'Business rates reform will help councils shape their areas and generate economic growth by giving them greater control over their finances - however there is far more work needed to ensure these reforms land successfully.
'These reforms will bring additional risks into local government which must be carefully managed.'