VATICAN CITY, Holy See (AFP) — The Holy See’s accounts remained in the red in 2014, but showed more than one billion euros in previously off-the-books assets, a statement said last week, following a drive to clean up the Vatican’s finances.

The annual financial statement, presented by the Pope’s economy czar Cardinal George Pell, showed “assets previously off the balance sheet” amounted to 1.1 billion euros (US$1.2 billion), while liabilities amounted to 222 million euros — with net assets increased by 939 million euros.

Australian Pell was last year appointed head of the Secretariat for the Economy by Pope Francis, tasked with the daunting job of revamping the Vatican’s byzantine financial system following a wave of scandals, including allegations of waste, corruption and even money-laundering.

In December, he said he had stumbled across hundreds of millions of euros “tucked away” in various accounts and not on the balance sheet, describing the windfall as a relic of the papacy’s medieval set-up.

“We have discovered that the (Vatican’s financial) situation is much healthier than it seemed,” he told Britain’s Catholic Herald — although a papal spokesman insisted Pell did not describe money as “illegal, illicit or badly administered”.

Thursday’s accounts showed a deficit of 25.6 million euros — a little higher than the 24.5 million euro deficit of 2013, owing to new and more stringent accounting standards, the Vatican said.

If the standards of 2014 were applied to the previous year, there would have been a deficit of 37.2 million euros in 2013, the statement said.

“The improvement in 2014 was largely due to favourable movements in investments held by the Holy See,” it explained.

Pell was appointed to bring the Church’s financial management into line with international accounting standards, and prior to his arrival he described the Vatican’s finances as “sloppy, inefficient and open to being robbed”.

As in previous years, the biggest expense in 2014 was the cost of staff — 126.6 million euros for 2,880 employees.

Pell presented the balance sheet of the Holy See along with that of the Government of the Vatican City State, which includes the Vatican’s popular museums, and saw a surplus of 63.5 million euros, up from 33.0 million in 2013.

This was “largely due to continued strong revenue from the cultural activities (especially the museums) and favourable movements in investments”, the statement said.