Presentation of Holy See's Financial Statement for 2003

Third Straight Annual Deficit

Print Friendly, PDF & Email
Share this Entry

VATICAN CITY, JULY 8, 2004 ( Here is the address of Cardinal Sergio Sebastian, president of the Prefecture for the Economic Affairs of the Holy See, when presenting to the press today the Consolidated Financial Statement of the Holy See for the fiscal year 2003.

* * *

Here in our usual meeting, I have the honor of presenting the Consolidated Financial Statement of the Holy See for the fiscal year 2003, expressed, of course, in euro.

As a consolidated financial statement, it represents as an integrated whole all the income and expense of the various Vatican administrations that are within the area of consolidation. Thus it includes the Administration of the Patrimony of the Holy See (APSA) — the most important in that it provides for all the administrative operations of almost the totality of the Offices and the Entities of the Roman Curia — the Congregation for the Evangelization of Peoples, the Apostolic Camera, Vatican Radio, the Osservatore Romano — Vatican Printing Press (merged with regard to administration), the Vatican Television Center, and the Vatican Publishing House.

As you know, the world economy, beginning with the last half of the year 2000, had already entered into a phase of crisis that then also amply reflected the effects of the turbulence provoked by different kinds of events such as the attack on the Twin Towers, the last series of terrorist attacks, the war in Iraq and the persisting Israeli-Palestinian conflict.

Only since the second half of 2003 was a certain recovery of stock activity evident, but in Europe investments are still lacking and above all demand is weak. The appreciation in value of the euro has continued, especially in relation to the U.S. dollar.

Our financial statement could not help but reflect all of this: we register a deficit of 9,569,456 euro, a deficit lower, however, than that of the previous fiscal year, which stood at 13,506,722 euro.

This is the third negative result that follows upon a period of surpluses right up to 2000. The loss is due primarily to the reversal of the result in the financial sector.

With this introduction, I turn now to the analysis of the principal entries of the operating statement, which as usual are expressed in the following four categories.

1) Institutional Activity. This first sector encompasses all the Dicasteries of the Roman Curia (the Secretariat of State, the Congregations, Councils, and Tribunals, the Synod of Bishops and the various Offices); these assist the Holy Father more closely in his ministry as Universal Pastor at the service of the Particular Churches and also for the benefit of humanity as promoter of peace in today’s world. Entities such as those indicated above, called as they are to render services, do not produce income.

This is the source of the significance of Canon 1271 C.J.C., which invites the Bishops to come freely, according to their ability, to the aid of the necessities of the Holy See to make it possible for him to offer his service to the Universal Church, in the same way that, under Canon 1263, C.J.C., the diocesan curiae are sustained by free offers coming from the parishes. The volume of donations that came to the Holy See in 2003 showed in its various components a decrease, due also to the increased value of the euro in relation to the U.S. dollar and to other currencies, falling from roughly 85.4 million to roughly 79.6 million.

On the positive side, however, we note that the diminution of costs from 2002 to 2003 was greater: from roughly 106 million in 2002 the expenses of the entire sector of institutional activities fell to 99.4 million. Cost of personnel diminished by more than one million euro, and other significant entries decreased as well.

Compared with 2002, the only entry for expenses in this sector that increased was that of public utilities and services.

This important sector closes with a deficit of 19,738,384 euro, a decreased deficit compared with that of 2002 for this sector, which stood at 20,606,021 euro.

2) Financial Activity. In this sector are included the financial activities of the consolidated administrations: I remind you that the most important financial portfolio is that of APSA Extraordinary Section.

The net result of this sector is negative in the amount of 11.6 million, for a decrease by 4.7 million in the deficit compared with 2002, when the financial sector showed a deficit of 16.3 million. This can be attributed to the world economic context already mentioned at the beginning of this report. Within this sector, the loss relative to fluctuations in exchange rates the thoroughly unfavorable course of the world economy in the course of the year: within this sector, the loss on fluctuations in the rates of exchange, which amounted to roughly 45 million euro in 2002, was reduced to 32.8 million in 2003 as a consequence of the slight improvement begun in the second half of the year, but also other entries in the sector reflect the protracted general situation of decline.

3) The Real Estate sector in 2003 showed total expenses of 27.1 million euro and income of 49.5 million euro; the sector therefore closed with a gain of 22.4 million euro, compared with 19.1 million euro in 2002. A good part of this result found its source above all in the increase in rental revenues.

Against this is an increase in maintenance costs. The other entries showed less significant variations.

4) The activity of the Media Institutions connected with the Holy See showed, for the second time in many years, an improvement in the closing balance, which was negative in the amount of only 1.2 million euro compared with a negative result for 2002 of roughly 1.7 million euro. In this sector, the total expenses fell from 42.4 million euro in 2002 to 41.9 in 2003, while the total income maintained substantially the same sum as in the previous year, with a decrease of some tens of thousands of euro (40.702 million in 2003 compared with 10.745 in 2002): in these figures is included, as in the previous year, a significant contribution designated for Vatican Radio by entities external to the consolidation.

The last part of the operating statement pertains to Other Income and Expense. This presents a positive result of 532 thousand euro, down from the roughly 6 million euro of the preceding year. The modestly positive result reflects some unexpected income that came during the year.

After having submitted the financial statement to the examination of the Council of International Auditors, I had the privilege of presenting the Consolidated Financial Statement of the Holy See for 2003 to the Holy Father in the course of an Audience granted to me on 1 July, 2004 and to the Council of Cardinals for the Study of the Organizational and Economic Problems of the Holy See, which met on 6 July, 2004. The financial statement will now be translated into various languages and sent to the Bishops and the Superiors General of Religious Institutes.

We are now happy to respond to your questions.

[Original text distributed by the Holy See]

Print Friendly, PDF & Email
Share this Entry


Support ZENIT

If you liked this article, support ZENIT now with a donation