17 July 2015, The Tablet

Vatican accounts list €1bn of previously unreported assets

by CNS

The Holy See reported almost €1 billion (£654,000) in net assets that had never been reported before and in a consolidated form, the Vatican’s final figures for 2014 showed.

The accounts, produced implementing new reporting procedures that are more in line with international accounting standards, also show a continued budget deficit on the part of the Roman Curia and nearly double the profits brought in by entities falling under the separate Vatican City State budget.

Profits from the Vatican Museums, "cultural activities" and investments offset the deficit in the consolidated budgets of the Roman Curia and Vatican communications outlets to help the Vatican end the year €37.9m (£26.3m) in the black.

The Council for the Economy presented the financial statements on 14 July, and they were published on 16 July. The statements were prepared by the Prefecture for the Economic Affairs of the Holy See, the Vatican's budget management office. The statements were reviewed and verified by the Secretariat for the Economy, headed by Australian Cardinal George Pell, as well as by a brand new auditing committee of lay experts and an external auditor.

The 2014 budget reports were the first financial statements to follow sweeping new procedures begun under new rules that went into effect on 1 March, governing the guidance, oversight and control of Vatican financial and administrative activities, and codifying the mission of the council and secretariat for the economy.

The summarised statement released by the Vatican press office on Thursday offered much of the same kind of information included in past statements released each year, as the transition to the new procedures is still a "step-by-step" work in progress, Fr Federico Lombardi, Vatican spokesman, told reporters.

However, the one new figure released publicly was all the net assets of the Holy See. Totalling €939m (£652m), the amount represents money that had never been included before in the Vatican's old system of budgeting and reporting.

In an interview in December, Cardinal Pell said the new budgeting and reporting procedures had meant the secretariat discovered "some hundreds of millions of euros were tucked away in particular sectional accounts and did not appear on the balance sheet."
Fr Lombardi explained to reporters the next day that the money did not represent "illegal, illicit or badly managed funds," just assets being held in numerous administrative offices that were not considered part of the main institutions of the Curia.

For 2014, however, all departments, bodies and foundations of the Holy See were required to report all assets –– which totalled €1.1bn (£763m), and liabilities – which totalled €222m (£154m).

The budget of the Holy See, which is made up of 64 "entities," ended 2014 with a deficit of more than €25.6 million (£17.8m).

The new reporting and budgeting practices made it difficult to compare figures with past years, the Vatican statement said.

In fact, it said if the new practices had been applied to the 2013 fiscal year, the budget deficit for the Holy See would have much higher – €37.2m (£25.8m), rather than the €24.4 (£16.9m) that had been reported. The reduced deficit for 2014, it said, was "largely due to favourable movements in investments held by the Holy See."

"While rapid progress is being made in implementing reforms requested by the Holy Father, the complete transition" to international accounting standards "is likely to take several years,” the statement said.


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