The State Railway of Thailand, the country's worst-performing state enterprise financially, is finalising its first accounting of its assets and liabilities in more than a decade.
Prasong Poonthanet, the director-general of the State Enterprise Policy Office, said that while the railway operator had the greatest losses among the country's state enterprises, it was technically solvent, with assets valued at considerably more than its debt.
But the SRT's finances have suffered from the failure to properly value and manage its assets, which include large landholdings across the country.
Mr Prasong said the SRT also lacked systematic controls and accounting systems, causing lost revenues and waste.
He said the SRT had no clear system to monitor lessees of its properties, resulting in wasted time and opportunity costs in cases of disputes or failure to meet contract obligations.
For 2010, the SRT reported a preliminary loss of 7.58 billion baht, with accumulated losses of 57.3 billion baht. Assets were recorded at 124 billion baht against liabilities of 85.7 billion.
In terms of key financial ratios, the 2010 accounts show a return on assets of -6.7%, with return on equity of -19.36% and a debt-to-equity ratio of 2.19 times. Net profit margin was -56.34% for 2010.
The agency's poor finances stem in part to high operating expenses due to outdated equipment, heavy pension expenses and debt service costs.
Only half of the SRT's trains are considered usable, with an average age of 45 years for rolling stock and 34 to 37 years for its rail networks.
The SRT is also limited in its ability to price fares to match its costs, due to government policies aimed at curbing rail fares for commuters.
Efforts to restructure the agency over the past several years have made little headway, in part due to weak information databases and conflicting accounts.
The SRT's assets for instance show considerable discrepancies from its own inventory records, leading the Auditor General's Office to consistently refuse to offer an opinion on its annual financial records.
In any case, the government has earmarked 176 billion baht in funds for rail investment by the SRT through 2014.
The government also is in the process of splitting its operations into distinct business units, covering rail operations, asset management and maintenance functions.
New businesses meanwhile will be developed under 100%-owned subsidiaries, such as Airport Rail Link Co, which operates a light-rail system from inner Bangkok to Suvarnabhumi Airport, and a company set up to operate the Chatuchak Weekend Market, a popular spot located on SRT land.