A2B EVENTS LTD

Executive Summary

A2B EVENTS LTD is in a precarious financial position after its first year, with negative net current assets and shareholders’ funds, and significant tax liabilities outstanding. The company currently lacks the liquidity and financial strength to support additional credit without substantial improvement in cash flow or capital structure. It is recommended to decline credit until the company demonstrates operational stability and improved financial metrics.

A2B EVENTS LTD - Analysis Report

Company Number: 14692641

Analysis Date: 2025-07-29 12:25 UTC

1. Credit Opinion: DECLINE
   A2B EVENTS LTD shows significant financial distress with net current liabilities of £15,067 and negative shareholders’ funds of £15,069 as at 28 February 2024. The company has been trading for just one year and reports no employees, indicating a very early-stage business without established operations or revenue. The current liabilities consist solely of taxation and social security debts, which suggests the company has not generated sufficient profit to cover statutory obligations. Given the negative working capital position and no evidence of cash flow generation beyond a nominal cash balance of £660, the company lacks the financial capacity to service additional credit at this time.

2. Financial Strength:
   The balance sheet reveals an extremely weak financial position. Total assets are minimal (£662), primarily cash and a negligible debtor balance. Current liabilities (£15,729) exceed current assets by a large margin, resulting in negative net current assets. There are no fixed assets or long-term investments. Shareholders’ funds are negative, reflecting accumulated losses or initial funding shortfalls. This indicates the company is heavily reliant on external financing or shareholder support to meet obligations. The absence of an income statement limits insight into profitability trends but the tax liabilities imply some trading activity without profitability.

3. Cash Flow Assessment:
   With only £660 in cash and minimal current assets, liquidity is severely constrained. The large tax and social security creditor balance due within a year highlights imminent cash outflows that the company is currently unable to cover from liquid resources. The negative net current assets demonstrate a working capital deficit, undermining operational flexibility and increasing the risk of payment defaults. The lack of employees suggests limited operational activity but also no payroll obligations beyond statutory amounts owed. Overall, cash flow risk is high, with insufficient buffer to absorb delays in receivables or unexpected expenses.

4. Monitoring Points:

• Timely settlement of outstanding tax and social security liabilities to avoid penalties or enforcement action.
• Improvement in working capital through increased sales, debtor collections, or equity injections.
• Monitoring cash reserves and operating cash flow to assess the ability to meet short-term commitments.
• Any changes in capital structure, such as shareholder loans or fresh equity, which could enhance financial stability.
• Directors’ strategic plans to transition from start-up phase to sustainable trading with positive earnings.