Company Number: 14130927

Analysis Date: 2025-07-29 12:26 UTC

1. Risk Rating: HIGH
   The company exhibits significant negative net assets and net current liabilities that have materially worsened over the last two years. The director's loan account has increased sharply, indicating reliance on director funding to meet obligations, which raises concerns about solvency and liquidity.

2. Key Concerns:

• Negative net assets of £5,928 as of 31 May 2024, deteriorated from £1,846 in the prior year, indicating the company is insolvent on a balance sheet basis.
• Negative working capital (net current liabilities of £5,928), showing inability to cover short-term liabilities with current assets, posing liquidity risk.
• Increasing director’s loan balance (£25,300 in 2024 vs £4,700 in 2023), suggesting dependence on director financing rather than operational cash flow.

3. Positive Indicators:

• The company is current with all statutory filings and accounts, indicating compliance with regulatory requirements.
• Sole director is also the 75-100% shareholder, which may enable swift decision-making and access to additional capital if needed.
• The business is classified under dental practice activities, a generally stable sector with ongoing demand.

4. Due Diligence Notes:

• Clarify the nature and terms of the director’s loan: Is it repayable on demand, interest-bearing, or convertible to equity?
• Review cash flow statements or bank statements (not provided) to assess operational cash generation or further reliance on director funding.
• Investigate reasons for persistent losses and whether the business has a viable turnaround plan or strategy for profitability.
• Confirm if there are any contingent liabilities or overdue tax or supplier payments not reflected in the accounts.
• Assess any related party transactions and governance controls given the director’s large financial involvement.