Company Number: 13786432

Analysis Date: 2025-07-20 17:19 UTC

1. Credit Opinion: DECLINE
   16-Bit Squirrel Ltd currently presents a weak credit profile. The company shows negative net assets and net current liabilities, indicating an inability to cover short-term liabilities with current assets. The worsening working capital position from negative £1,714 in 2023 to negative £2,502 in 2024 highlights increasing liquidity stress. Given the company’s micro-entity size, single director control, and lack of fixed assets, the capacity to service debt or new credit facilities is highly constrained. Without clear evidence of improving cash flows or capital injection, extending credit poses significant risk.

2. Financial Strength:
   The balance sheet reveals net liabilities of £2,502 as at 30 September 2024, deteriorating from net positive assets of £393 at end 2023. Fixed assets have been fully depleted, and current assets have shrunk drastically from £4,502 to £186. Current liabilities remain substantial at £2,688, causing negative working capital. Shareholders’ funds are negative, reflecting accumulated losses or capital erosion. The company’s financial structure shows no buffer to absorb shocks or support growth.

3. Cash Flow Assessment:
   Current assets (cash and receivables) are minimal and insufficient to cover immediate liabilities. The negative net current assets indicate poor liquidity and potential challenges in meeting short-term obligations. With only one employee (the director) and no audit requirement, detailed cash flow statements are unavailable, but the balance sheet position strongly suggests constrained operational cash flows. The absence of fixed assets further limits collateral value.

4. Monitoring Points:

• Monitor quarterly trading updates or management accounts to assess any improvement in liquidity and working capital.
• Watch for capital injections or loans from the director or third parties that could strengthen the balance sheet.
• Track any changes in creditors’ terms or overdue payments that may indicate worsening credit risk.
• Review any strategic changes that might improve revenue generation or profitability.