The number of suspicious transactions reported to the Vatican's financial watchdog has risen dramatically.

The Financial Information Authority's Annual Report for 2015 shows there were 544 reports in 2015, compared to 147 in 2014.

Officials say the figures do not indicate a rise in illicit financial activities but instead reflect a number of factors, including a "strengthening of the reporting system" and the closure of accounts belonging to non-compliant clients.

The Vatican has been trying to reform it's finances and improve transparency following a series of scandals, which include accusations the Vatican Bank has been used by money launderers.

Of the 544 suspicious transactions reported last year, only 17 were submitted for further investigation by the Vatican Promoter of Justice.

It was announced last week an external audit into the Vatican's finances by PricewaterhouseCoopers was being suspended.