Company Number: 13014642

Analysis Date: 2025-07-29 18:13 UTC

1. Risk Rating: MEDIUM
   The company shows a significant decline in net assets and current assets from 2022 to 2023, with a sharp reduction in cash balances and a substantial increase in current liabilities. However, it remains solvent with positive net assets and no overdue filings, indicating some operational continuity but raising concerns about liquidity and financial stability.

2. Key Concerns:

• Liquidity deterioration: Cash decreased from £639,175 in 2022 to £251,177 in 2023, while current liabilities rose dramatically from £15,721 to £215,438, indicating potential cash flow stress.
• Rising short-term creditors: Trade creditors increased over tenfold to £182,547, which may reflect delayed payments to suppliers or accumulated payables, posing risks to supplier relationships.
• Declining net assets and shareholder funds: Net assets dropped from £652,914 in 2022 to £195,007 in 2023, driven by a growing loss reserve (£668,830 deficit), which may suggest operational losses or impairments impacting sustainability.

3. Positive Indicators:

• No overdue statutory filings: Both accounts and confirmation statements are filed timely, evidencing good regulatory compliance.
• Positive net assets and shareholder funds: Despite the drop, shareholders’ funds remain positive (£195,007), indicating equity buffer remains.
• Increasing workforce: The average number of employees rose from 4 to 6, possibly indicating business growth or investment in operations.

4. Due Diligence Notes:

• Investigate causes for the sharp increase in trade creditors and current liabilities—confirm if these are normal business delays or signs of financial distress.
• Review profit and loss accounts (not filed publicly) to understand the drivers of the growing losses reflected in the profit and loss reserve.
• Assess cash flow forecasts and working capital management to confirm if liquidity issues are temporary or structural.
• Verify related party transactions, especially loans from directors (£89,000), to check for any contingent liabilities or unusual financing terms.
• Explore the impact of the recent name change from IMPOSSIBREW LIMITED and any strategic shifts or rebranding effects on financial performance.