One angry woman was ejected and others repeatedly booed and jeered as Warrnambool City councillors voted to appoint an external auditor on Thursday night.
The packed special meeting saw councillors vote 6-1 for an independent body to review and assess council's credit card policies and its investigation into the misuse of one card.
Cr Peter Hulin was the lone voice against the audit, saying he would prefer a financial review to go further, covering a period of 10 years.
Mayor Tony Herbert asked members of the public gallery to refrain from yelling out, however they continued throughout the meeting.
Cr Kylie Gaston welcomed an independent auditor.
"I am confident that there is not a systematic credit card or financial fraud issue at this council," she said.
"It is a shame that at this point the wrong-doings of one person are implicating the other staff. I am pleased to appoint an external auditor to come into the organisation to review processes around this incident and also check our policies and procedures which protect the organisation from fraudulent behaviour."
A ratepayer was ejected from the meeting for calling Cr Gaston a "lying cow".
Cr Herbert said her outburst was unnecessary.
Her ejection drew applause from the public gallery.
Cr Gaston said an external audit would provide transparency and "it would be a good thing to come out of a very disappointing incident".
She said the council had dedicated staff "many of whom went above and beyond" working for the community.
Cr Mike Neoh said it was the duty of the council to ensure they had policies in place to deal with any misuse.
"When we put in place an external auditor we will be expecting them to go through the Victorian Auditor General's report to make sure that all our policies are up to date and meet guidelines," he said.
Some ratepayers are pushing for a full forensic audit of the council over the past decade, however Cr David Owen said that would be costly.
"I think it's an absolute shame this has happened," he said.
"I believe we have had credit cards since the 1980s. If you want us to go back that far it would cost a fortune. I think for the sake of one person doing the wrong thing it doesn't smear everybody else."
Cr Sue Cassidy said the work chief executive officer Peter Schneider had completed during this tough time was "extraordinary".
"It's not good to have a new CEO to come in on such a situation," she said.
"I look forward to the external audit."
Cr Hulin questioned if the special meeting was following normal process and correct procedure.
"Is this recommendation budgeted for?," he asked.
"How will it be paid in light of our above CPI rate increase? Is this review limited to 2018 or if something is discovered, will we go beyond that date?"
He said if Mr Schneider had followed all correct reporting procedures perhaps another authoritative body would investigate "free of charge". He asked if the findings would be revealed to the public.
"This is a smokescreen to hide the real problem that has been going on in our council," he said.
"People have had enough and want good governance and transparency."
He called for an in-depth investigation of "all aspects of management, financial performance and governance of the council from 1/1/2009 to 31/12/2018".
"If this is done then we can say at the end of it we have an open and transparent council and everything is in shape, or it's not," he said.
"That is what the people of Warrnambool deserve."
Cr Herbert said contrary to what some people in the community believed, the credit card misuse was picked up by "internal checks and balances".
"I am now confident the correct and lawful procedures are underway," he said.
He said an external audit would help to "strengthen and bolster" processes to ensure it didn't happen again.
He said each year the council's finances were audited by the auditor general's office and sent to the government for review. He said if people had complaints, there were avenues for them to look into, including talking to the Independent Broad-Based Anti-Corruption Commission.
"One incident doesn't warrant an entire organisation being trashed for all the work they do," he said.
Cr Robert Anderson did not comment during the half-hour meeting.