ADASKY TECHNOLOGIES LIMITED
Executive Summary
ADASKY TECHNOLOGIES LIMITED shows significant solvency and liquidity risks, highlighted by negative net assets and worsening working capital in its second year of operation. While statutory compliance is maintained and the business is small and owner-controlled, the financial data indicates potential challenges in meeting obligations without further capital support or operational improvements. Prospective investors should conduct thorough due diligence focused on cash flow and business sustainability before proceeding.
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This analysis is opinion only and should not be interpreted as financial advice.
ADASKY TECHNOLOGIES LIMITED - Analysis Report
Risk Rating: HIGH
The company exhibits a deteriorating financial position with net current liabilities increasing substantially and negative net assets reported for the latest financial year. This indicates solvency concerns and potential inability to meet short-term obligations.Key Concerns:
- Negative net current assets of £2,370 as at 31 March 2024, worsening from a positive net current asset position in previous years, signals liquidity stress.
- Net assets and shareholders’ funds are negative (£2,370) in 2024, suggesting the company's liabilities exceed its assets, raising solvency risk.
- The company is very young (incorporated in 2022) and small (micro-entity), with only one employee and limited financial history, which limits visibility on operational sustainability and cash flow robustness.
- Positive Indicators:
- The company is timely with statutory filings; no overdue accounts or confirmation statements are recorded.
- Ownership and control are consolidated under a single director and shareholder with full voting rights, which may allow for agile decision-making.
- The company operates within the IT consultancy and service sector, which can have scalable business models and potential for growth.
- Due Diligence Notes:
- Verify the nature of current liabilities and any plans or ongoing efforts to address the negative working capital position.
- Assess cash flow statements and any off-balance sheet financing or commitments not captured in the micro-entity accounts.
- Understand the business model, revenue streams, and customer base to evaluate operational viability beyond the limited financial snapshot.
- Investigate director’s plans to recapitalize or restructure the company to restore solvency.
- Confirm whether the micro-entity accounts fully reflect all financial obligations or if there are related party transactions or contingent liabilities.
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