Nine of 62 locomotives run, and the balance sheet holds 119 million euros of goodwill: auditors open the books of Macedonian Railways Transport

The State Audit Office has published its report on ŽRSM Transport, Macedonia's state rail operator, for 2024, and the first part reads like a museum inventory. Of 62 locomotives, nine are in working order - less than 15 percent. Of 16 passenger trainsets, five run. Of 47 passenger carriages, two are used in regular service.

Freight is no better. Of 1,382 freight wagons, only 378 have a valid inspection. The remaining 1,004, or almost 73 percent, are out of service because their mandatory technical inspection has expired. The series 661 diesel locomotives are on average more than 60 years old, the electric ones 35. According to the auditors, the reasons are well known: insufficient investment in maintenance, late repairs and a chronic lack of money.

And the money is a story of its own. In 2024 the company posted a loss of 331.8 million denars, around 5.4 million euros. The year before - 759.4 million denars, around 12.3 million euros. By the end of 2024 the accumulated loss had reached 6.75 billion denars, or roughly 110 million euros. There is a loss in every year of the period analysed, from 2014 to 2024.

119 million euros of goodwill

The strangest finding is in the balance sheet. For years it has carried so-called goodwill of 7.32 billion denars, around 119 million euros - an accounting item that usually arises when one company buys another. The auditors found no basis for recognising it as an intangible asset. Yet that single item makes up almost 79 percent of the total reported assets of around 9.3 billion denars. In other words, most of the railway's "wealth" exists only on paper.

The rest of the report is no easier to read. As much as 71 percent of inventories, worth 342.3 million denars or around 5.5 million euros, dates from before 2019 and hasn't been revalued. Fuel was handled improperly and unsafely, the measuring equipment is outdated, improvised and open to manipulation, and the pumps hadn't been calibrated for a long time. The State Audit Office gave an adverse opinion both on the accuracy of the financial statements and on the company's compliance with the law.

The company replies that it is acting "with full institutional responsibility", that it has been carrying out financial and operational stabilisation since July 2024 and that the measures are part of its 2026-2027 Action Plan. A significant share of the findings, it says, are "long-standing and systemic in nature".

Systemic, yes. That's exactly the problem. Eleven years of losses in a row, and every management team inherits the "long-standing" from the one before and hands it on to the next. Who answered for any of it in the meantime? And will the Action Plan reach the tracks before the last of the nine locomotives stops too?