Hundreds of millions of euros have been found "tucked away" in Vatican bank accounts.
The city-state's Economy Minister has confirmed the cash was lodged in various Holy See departments and never showed up on the balance sheets.
The find means that Vatican finances are healthier than previously suspected.
In February the Pope created a new office to oversee its scandal plagued banks and made Cardinal George Australian Cardinal George Pell, Secretariat for the Economy.
In an article in the the Catholic Herald Magazine, Pell said: "In fact, we have discovered that the situation is much healthier than it seemed, because some hundreds of millions of euros were tucked away in particular sectional accounts and did not appear on the balance sheet,” he said.
"It is important to point out that the Vatican is not broke ... the Holy See is paying its way, while possessing substantial assets and investments," Pell, the most senior English-speaking official in the Vatican, said.
Pell did not suggest any wrongdoing but admitted the financial affairs of Vatican departments over the years had been handled with great secrecy and little regulation, meaning they were permitted to “lurch along, disregarding modern accounting standards.”
Pell said the various Vatican departments acted with a large amount of independence and that solitary streak permeated many levels of the state.
“I once read that Pope Leo XIII sent an apostolic visitor to Ireland to report on the Catholic Church there.
“On his return, the Holy Father’s first question was: ‘How did you find the Irish bishops?’ The visitor replied that he could not find any bishops, but only 25 popes," he said.
“So it was with the Vatican finances. Congregations, Councils and, especially, the Secretariat of State enjoyed and defended a healthy independence. Problems were kept ‘in house’ (as was the custom in most institutions, secular and religious, until recently). Very few were tempted to tell the outside world what was happening, except when they needed extra help," he added.
