The PSNI is facing a £100m funding gap over the next four years - the equivalent of more than 2,000 police officers, according to a report by Her Majesty's Inspectorate of Constabulary.
An inspection by HMIC on the force's financial efficiency at a time of austerity found that available police funding up to the year 2018/19 "does not match the required resources".
The report, released today, said that beyond 2014/15 the PSNI envisages that the shortfall in its funding gap will grow to £104m. The force equates this shortfall to approximately 2,080 police officers or more than 3,466 police staff.
As the PSNI attempts to deal with stringent budget cuts, HMIC warned that the force does not yet have a "comprehensive and co-ordinated assessment" of the demand it faces both now and into the future.
"Without a clearer understanding of the demands that the PSNI faces, it is hard for the force to identify its resource requirements and how these can be organised most effectively within an affordable operating model."
The investigation also found that the PSNI's commitment to community policing and the importance of having capacity to deal with public order and the continuing terrorist threat "is not supported by a detailed assessment of critical posts or capacity and capability needs."
"We found that neighbourhood staff are frequently taken out of their district roles to support public order activities and capacity is stretched within the response teams," the report stated.
It added: "Officers told us that they have limited opportunities to patrol crime hotspots proactively because they are continually responding to new incidents."
The PSNI has now been asked to carry out an urgent review of its savings plan. A comprehensive assessment of current demand, an affordable organisational model and evidence that the model can respond to the assessed future demand has to be provided to the Policing Board and HMIC by the end of next month.
The Chief Constable has already told the Policing Board that officer numbers will drop over the next few years because of budget constraints.
HMIC said that staff have expressed concerns about reducing the number of officers on the ground.
"They report overtime levels are high and that officers are asked regularly to work on rest days," the report said.
Policing the past and the security threat is a "significant additional responsibility which is estimated to cost the PSNI £25m per year", the report stated.
HMIC said that the work already undertaken by the PSNI is "effective and appropriate" but added that "its scope so far has been limited to finance, human resources functions and district policing."
Despite the austerity constraints the PSNI has maintained the same target for emergency response calls and priority calls, the report found.
Recorded crime, however, rose by over 2% in the last year.