Company Number: 13269232

Analysis Date: 2025-07-20 13:50 UTC

1. Risk Rating: HIGH
   The company exhibits significant financial stress with minimal net assets and a sharp decline in net current assets from £107 in 2023 to just £4 in 2024. The near parity of current liabilities and current assets, coupled with a very low cash balance in prior years and a small shareholder capital base, suggests vulnerability in meeting short-term obligations.

2. Key Concerns:

• Liquidity Crunch: Cash increased in 2024 (£2,995) but was critically low in previous years (£32), indicating volatile cash flow management. The very narrow net current assets (£4) in 2024 imply limited buffer to cover immediate liabilities.
• Profitability and Reserves Erosion: Shareholders’ funds have fallen drastically from £106 in 2023 to £4 in 2024, indicating potential losses or withdrawals not fully explained. The company’s profit and loss reserves are minimal, pointing to weak retained earnings or operational losses.
• Reliance on Director’s Loans and Tax Liabilities: The presence of director’s loan accounts both as debtors and creditors and increasing corporation tax liabilities (£1,917 in 2024 vs £842 in 2023) may reflect cash flow timing issues or tax planning concerns that could compromise financial stability.

3. Positive Indicators:

• Compliance and Filing: The company is up to date with its accounts and confirmation statement filings, suggesting good regulatory compliance.
• Active Status and Clear Control: The company is active with a single controlling director and shareholder, implying clear decision-making authority.
• Sector Activity: Operating in motion picture production, a specialized field, may offer niche market opportunities if operational challenges are addressed.

4. Due Diligence Notes:

• Investigate the reason for the drastic decline in net assets and reserves between 2023 and 2024, including any losses or unusual transactions.
• Review detailed cash flow statements and management accounts to assess liquidity trends and the sustainability of cash inflows.
• Examine the nature and terms of the director’s loan accounts and corporation tax liabilities to understand the timing and impact on solvency.
• Assess operational performance and contracts in the motion picture sector to evaluate revenue reliability and business sustainability.
• Confirm no hidden contingent liabilities or impending tax disputes given the rising tax creditor balances.