Company Number: 12933122

Analysis Date: 2025-07-29 14:47 UTC

1. Risk Rating: HIGH
   The company exhibits significant solvency and liquidity risks due to large net current liabilities, ongoing losses, and reliance on parent company funding.

2. Key Concerns:

• Severe Net Current Liabilities and Negative Equity: As of 31 December 2023, net current liabilities stand at approximately £2.31 million, with shareholders’ funds negative by the same amount, indicating substantial financial distress.
• Recurring Losses: Losses have persisted over recent years (£371k loss in 2023, £577k loss in 2022), which erodes capital and threatens operational sustainability.
• Reliance on Parent Company Support: The going concern assumption depends entirely on continued financial support from the parent company, Dura Software Inc, which currently funds over £2.3 million of liabilities. This creates dependency risk if parent support ceases.

3. Positive Indicators:

• Up-to-Date Filings: The company’s accounts and confirmation statements are filed on time, showing compliance with statutory requirements.
• Unqualified Audit Opinion: The auditor issued an unqualified report, indicating no material misstatements in the financial statements.
• Small Company Reporting: The company benefits from reduced disclosure requirements, indicating a relatively straightforward business structure.

4. Due Diligence Notes:

• Verify the terms, conditions, and security of the intercompany liabilities owed to Dura Software Inc, including repayment terms and any covenants.
• Assess the parent company’s financial health and willingness to continue support beyond the 12-month horizon stated.
• Investigate operational cash flows and prospects for profitability or funding alternatives that could reduce reliance on parent funding.
• Review management plans for addressing negative equity and liquidity deficits, including any restructuring or refinancing initiatives.
• Confirm absence of director disqualifications or governance issues beyond those disclosed.