The Catholic Metropolitan Cemeteries Trust manages five large cemeteries across western Sydney, including the first new crown cemetery built in the city since World War II.
But it was the subject of scathing attack from the NSW auditor-general after continuing to refuse access to its books.
The registered charity disputes it is a controlled state entity, despite the auditor-general and successive state governments holding that view.
"Denying the auditor-general access to (trust) management and its books and records for the purpose of conducting the statutory financial audit is not appropriate and should not be normalised by the NSW government," the auditor-general said in a report published on Thursday.
"It significantly impairs transparency and accountability and raises questions about the proper stewardship of resources."
The trust is due to take on a more prominent role in burial services for Sydney in coming years.
The government in 2023 warned some Orthodox and Muslim communities had three years left before their allocated grave space in Sydney's crown cemeteries was filled.
The dire situation and other mismanagement concerns prompted the amalgamation of four crown cemetery managers into a single entity.
The Catholic trust was left untouched and later handed the keys to the 136,000-plot Macarthur Memorial Park, due to open in 2025.
The 113-hectare park at Varroville in Sydney's southwest is the first new crown cemetery built in the NSW capital in more than 80 years.
The trust declared no government revenue in 2022/23 in records submitted to the national charity regulator.
The trust has been contacted for comment.
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