The State Audit Institution identified an approximately €468 million capital deficit at Železnice Srbije a.d. in its review of the legacy railway company’s 2025 accounts. The findings also point to material uncertainty about whether the company can continue operating without support from its founder, the state.
The company’s losses exceeded its capital by RSD 55 billion, while it recorded a net loss of RSD 547 million, or roughly €4.7 million, for 2025. Its short-term financial obligations were RSD 65 billion, equivalent to about €553 million, compared with current assets of just RSD 261 million, or €2.2 million.
The auditor reported that the company’s bank accounts had been blocked for around five years, with close to RSD 1 billion under blockage. The findings concern the legacy company, not the combined results of the separate businesses operating passenger services, freight or railway infrastructure.
Unreconciled liabilities and assets
Železnice Srbije a.d. is the entity left with assets and obligations after Serbia’s railway sector was restructured. The audit found that the company had not supplied supporting evidence for more than RSD 2 billion of reported trade liabilities, and that at least RSD 1.1 billion of liabilities remained unreconciled.
Auditors also identified failures to record some court-related obligations in the correct accounting periods, along with shortcomings in the inventory of assets and obligations. The report said the company’s ability to settle claims could not be assessed precisely without reliable reconciliations and asset valuations.
Legacy obligations remain on the balance sheet
Unresolved contracts, property and creditor claims can remain with the legacy company after railway operations have moved to new entities, leaving financing and litigation risks on its balance sheet. The audit findings therefore relate to Železnice Srbije a.d. and should not be treated as consolidated results for the wider railway sector.
The capital deficit does not automatically represent an immediate liability for the state budget. Any state payment would depend on legal obligations and policy decisions, while resolving the company’s imbalance would require verifying claims and preparing a credible financial plan, rather than relying on accounting transfers alone.
