Company Number: SC728780

Analysis Date: 2025-07-29 20:25 UTC

1. Risk Rating: MEDIUM
   The company shows a negative net asset position as at the latest financial year end (2024), indicating some solvency concerns despite positive net current assets. The presence of director loans and the micro-entity status with minimal assets suggests moderate financial fragility but no immediate distress signals such as overdue filings or liquidation.

2. Key Concerns:

• Negative Net Assets: The company reported net liabilities of £270 at 30 April 2024, down from a positive £11 the previous year, indicating erosion of equity.
• Director Loans: Significant unsecured, interest-free loans to directors (£129 each), which could pose a risk if repayment terms are not enforced or if the company requires cash.
• Minimal Current Assets and Cash: Current assets have decreased substantially from £506 to £258, with no disclosed cash balance in 2024, raising liquidity risk concerns despite nominal current liabilities.

3. Positive Indicators:

• No Overdue Filings: All accounts and confirmation statements are up to date, indicating good regulatory compliance and governance discipline.
• Stable Employee Count: The company maintains a stable headcount of two, suggesting operational continuity.
• Working Capital Positive: Despite net liabilities, current liabilities remain very low (£1), and net current assets are positive (£257), implying the company can cover short-term obligations.

4. Due Diligence Notes:

• Director Loans Terms and Recoverability: Investigate repayment likelihood and any formal agreements to understand liquidity impact.
• Reason for Net Asset Decline: Review detailed accounts or management commentary to identify causes of equity erosion (losses, write-offs, accruals).
• Business Model and Revenue Streams: Limited information on operations beyond SIC code (real estate trading) - assess revenue sustainability and market conditions.
• Accruals and Deferred Income: High accruals (£527) relative to assets require scrutiny to understand timing and nature of obligations.
• Intercompany or Related Party Transactions: As directors hold significant control and loans, confirm absence of conflicts or financial risks.

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