Secretariat for the Economy discovers 'hundreds of millions' of off-budget transactions at Vatican
December 03, 2014
The Vatican’s new Secretariat for the Economy has discovered that “hundreds of millions of euros” were not included on financial reports, Cardinal George Pell reports in an article for the Catholic Herald.
Cardinal Pell, who heads the powerful new Vatican office supervising financial affairs, explained that for generations, the offices of the Vatican conducted their own financial affairs independently. “Very few were tempted to tell the outside world what was happening, except when they needed extra help,” he said.
Under this system the business affairs of the Vatican were left to “lurch along, disregarding modern accounting standards,” the Australian prelate said. He observed that the lack of coordination and oversight, coupled with the naïve approach taken by many clerics, have frequently tempted shrewd financiers to exploit the Vatican over the years.
The goal of the Secretariat for the Economy is to regularize the Vatican’s financial transactions, bringing them into line with standard accounting practices and ensuring against corruption and avoidable errors, Cardinal Pell said. Church leaders should be good stewards of the resources entrusted to them, he said: “A Church for the poor should not be poorly managed.”
Cardinal Pell reported that the Vatican’s overall balance sheet is healthy. Although there is a need to shore up the pension fund for employees, he said that the Vatican is meeting its regular expenses. “It is important to point out that the Vatican is not broke,” he said.
Next year the Secretariat for the Economy will add an auditor-general to the staff. This new official, a lay expert, will work independently, have the authority to audit any office at any time, and report directly to the Pope.
Cardinal Pell said that while the Secretariat for the Economy is responsible only for the Vatican’s financial affairs, some bishops have begun to inquire about the new financial procedures that are being established, with a view to adopting similar procedures in their own dioceses.
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