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SNP MSP Richard Lochhead thanks the witnesses for the award to Bodysurf in Moray.

Mr Lochhead asks why Creatie Scotland did not anticipate the backlash to the funding decisions, including those relating to performers with disabilities.

Creative Scotland chief executive Janet Archer says there will always be risks when there are more applicants for funding than there is cash.

Mr Lochhead asks if Creative Scotland's decision making process has had its reputation severely damaged.

Ms Archer says yes, and again says "I say I'm profoundly sorry about that".

A final decision on whether the review will be held independently have not yet been made, Janet Archer says.

She does not want to make a commitment to this without speaking to the new Creative Scotland chair.

Committee convener Joan McAlpine says this is surprising given the review has already been announced.

SNP MSP Mairi Gougeon says it seems to be the case that "those who shout the loudest can get their funding decisions reversed".

There must be an independent review process to look at what went wrong, Ms Gougeon suggests.

CEO Janet Archer says Creative Scotland is meeting with organisations daily to discuss issues.

She accepts the need to review the process and adds staff are keen to take part in an internet exercise.

There will also be engagement with peers and the sector on how to manage the review process and other "independent thinking" will be brought in.

Tory MSP Rachael Hamilton asks what will be done to restore the confidence of the sector.

CEO Janet Archer says it is important to proactively engage with the sector and co-design the funding process.

It is not unusual for organisations like Creative Scotland to receive more applications than can be funded, she states, but accepts it could could be clearer and more focused about how it deploys its strategy.

Focus must also be given to how to grow audiences to ensure people have access to the highest quality arts across Scotland, Ms Archer says.

SNP MSP Stuart McMillan raises concerns around the geographic spread of recipients, asking what Creative Scotland did to resolve this ahead of the second funding round.

"We're keen to get into local areas at a community planning level", explains Janet Archer, but due to resources this is having to be done via place partnerships.

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Ben Thomson says because of the feedback over Creative Scotland's funding decision the board tried to stretch its budget to reverse the decision for five organisations.

He says: "I'm sorry if we got the balance wrong."

Mr Thomson says every organisation should listen to feedback.

Lib Dems MSP Tavish Scott asked what changed to lead to the decision to not fund five organisations to be reversed.

Ben Thomson says a number of factors were considered when looking at applicants.

It was understood that the touring programme should be funded differently Mr Thomson says, but feedback from the sector suggested there were concerns about touring not being done well.

Four of the five organisations are touring groups.

A specific touring fund will exist from April 2019, which means there is a 12 month gap, the committee is told.

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Mr Scott says the decision to withdraw funding from rural Scotland, like the Gaiety Theatre, appears elitist and dismissive of Ayrshire and the Scottish Borders.

A meeting with South Ayrshire Council will take place, while a previous meeting with the theatre was broadly positive in terms of establishing funding for the future, Ms Archer says.

Tory MSP John Scott highlights efforts being made to protect Gaiety Theatre in Ayr, saying RFO funding is "vital" to its future.

What funding can still be directed towards it "given the Gaiety application was misunderstood", he asks.

Janet Archer confirms Creative Scotland is in discussion with the theatre and local authority to look at alternative routes to funding in the future.

A number of other projects are funded in Ayrshire, says Ms Archer.

Creative Scotland is also considering how to reach the 12 local authorities currently not in receipt of RFO funding, she says, but notes eight councils have not applied for funding at all.

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Mr Greer asks who in Creative Scotland was aware there were concerns about factual inaccuracies.

Ms Archer says all of the lead officers and directors have been depoloyed with oranisations and the process is ongoing.

"We haven't yet taken stock of the outcomes of these meetings."

Mr Greer asks why the board was not informed about reports of factual inaccuracies.

Ms Archer says the board was unaware of this.

The Green MSP says this is a "serious internal communications breakdown".

Green MSP Ross Greer suggests organisations have lost confidence in Creative Scotland.

Janet Archer confirms there have been complaints about processes and says these are being looked at.

Ben Thomson adds the board did not meet to look at factual inaccuracies but rather to reallocate funding towards the pot for regularly funded organisations.

Mr Greer argues factual inaccuracies are relevant to board discussions because this may have led to issues with funding decisions.

Mr Thomson says the board was unaware of the factual inaccuracies.

The "cultural carnage" predicted for the latest round of arts funding did not arrive but a big shake-up of who receives the money has led to some high-profile losers.

Before Christmas, Creative Scotland was advising all arts organisations to batten down the hatches and prepare for up to 30% cuts to funding.

In the event, the Scottish government stepped in with a £6.6m increase to maintain the arts funding at £99m over three years and cover the substantial shortfall in the National Lottery cash.

Given this reprieve over the amount of cash it can spend, Creative Scotland could have played safe.

Read more here.

Former interim chair Ben Thomson says questions were asked about how much could be given to regularly funded organisations (RFOs).

This resulted in the additional five organisations being funded, he explains.

"I sympathise totally with organisations because funding of this sort is really important."

Creative Scotland is trying to work with other organisations, not just RFOs, to help them access other forms for funding.

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Committee convener Joan McAlpine says there has been a shift of funding from artists to development organisations.

Ms McAlpine says Creative Scotland is funding bureaucrats instead of artists.

Labour MSP Claire Baker reocognises the profound apology from Janet Archer but says there are issues going forward around Creative Scotland funding.

Convener Joan McAlpine says it is highly unusual for board members to receive papers, only for a decisions to be changed.

Ben Thomson explains there were two "relatively small changes" between 12 and 18 January.

It's not unusual for this to happen when budget considerations were ongoing, he argues.

Ms Archer explains scenario planning covered a standstill, a small uplift, -15% and -30% of funding which affected funded groups differently.

Only around 30% of applicants are successful in getting funding, the CEO explains, meaning decisions have to be made based on Creative Scotland's strategy.

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Creative Scotland has announced the appointment of Robert Wilson as chairman to its board.

Mr Wilson is co-founder of sculpture park Jupiter Artland Foundation and was previously chairman of the Edinburgh Arts Festival.

He succeeds interim chairman Ben Thomson who was appointed following the death of Richard Findlay last year.

The appointment follows the resignation of two board members in a row over the latest round of arts funding.

Read more here.

Committee convener Joan McAlpine says she is sure the sector hears the apology but says it was Creative Scotland that designed the process.

Ms Archer says this process was the same as the proceeding year.

Ms McAllpine says the issues of money being taken away from world class theatre companies and disability theatre companies were raised by Creative Scotland members.

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Former Creative Scotland interim Chair Ben Thomson says virtually every board member had raised concerns which was absolutely correct.

Ms Archer says since Mr Thomson stood down the new chair has held a meeting where the word "unanimous", in relation to the Creative Scotland decisions, was discussed and it has since been amended to "majority".

Ms McAlpine says that was a mistake and the use of the word "unanimous" hid a "barney at the meeting".