The Committee of Public Accounts (PAC) reported that building work is on schedule for test events to begin next year but had fears that the project could still be hit by unforeseen problems.

The Olympic Delivery Authority (ODA), which is in charge of Olympic build and infrastructure, has £1,270 million ($1,916 million) left from the original £2,747 million ($4,145 million) contingency.

Much of this is earmarked to meet predicted risks, leaving only £194 million ($293 million) "headroom," the PAC found.

Edward Leigh, the chairman of the PAC, said: "The position is tight, with no room for complacency and limited flexibility to respond to new problems as the Games approach.

"What's worrying is that the financial position is tight.

"Of the sum left within the Olympic budget for contingencies, £1,270 million ($1,916 million), most is currently earmarked for known risks.

"But unforeseen problems continue to emerge to place fresh demands on the contingency."

Staying within budget also depends on receiving about £600 million ($905 million) of receipts from the Olympic Village.

LOCOG, who are in charge of raising £2 billion ($3 billion) from non-public money to stage the Games, has so far raised 70 per cent of that total, mainly through sponsorship, and said last week when they launched a pre-registration scheme that they are optimistic that they will surpass initial ticket sales, which is another major source of income for them.

They do not go on sale until next year, but the PAC called on LOCOG to publish now the principles on which ticket availability and prices would be determined.

The PAC also urged LOCOG to establish a contingency fund to protect against failure to raise the funds.

The Government aims to repay £675 million ($1.018 billion) of the £2.1 billion ($3.168 billion) the National Lottery has put up for the Games through future profits on the sale of Park land and assets, but the committee noted there was no guarantee on the value and timing of that payment.

Responsibility for security in certain areas has yet to be resolved, such as the "grey space" between the transport hubs and Park venues, the committee said.

It called on the Government to make clear who has overall executive authority.

A spokesman for the ODA said: "We are continuing to make strong progress and the latest budget forecast shows us delivering the construction programme within the available budget.

"[This year] will be the toughest year yet on the project as construction work accelerates and the workforce peaks.

"The foundations for success are in place but we are in no way complacent."

The Department for Culture, Media and Sport said in a statement that, despite the current tough economic climate, progress remained on course and within budget.

It said: "Nevertheless, we are not complacent and we recognise that there are many challenges ahead.

"We will continue to work hard with all the delivery partners to ensure that we achieve the best value possible.

"The Government will formally respond to the PAC in due course."

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