Company Number: SC676347

Analysis Date: 2025-07-20 19:07 UTC

1. Risk Rating: HIGH

The company shows significant financial distress with net liabilities increasing markedly from £20,139 (2023) to £336,402 (2024) and worsening negative net current assets (£1.53m). This indicates solvency risks and inability to meet short-term obligations. The micro-entity status limits available financial disclosures, but the trend points to financial instability.

2. Key Concerns:

• Negative net assets and sharply increasing current liabilities relative to current assets indicate poor liquidity and solvency issues.
• Rapid growth in current liabilities (from £1.12m to £1.85m) without a proportional increase in current assets or equity raises concern about cash flow management.
• The company employs 7 people but has no detailed information on revenue or profit, limiting insight into operational viability.

3. Positive Indicators:

• The company is current on filing all statutory accounts and confirmation statements, which implies regulatory compliance and transparency.
• Fixed assets have increased from £946k to £1.19m, suggesting some investment or asset base growth.
• The board consists of multiple directors with significant control, which may indicate active governance.

4. Due Diligence Notes:

• Investigate the nature and terms of the current liabilities to understand if they are short-term debts, trade payables, or other obligations.
• Review cash flow statements, income statements, and any management accounts to assess operational performance and revenue streams.
• Clarify the reasons behind the increase in liabilities and negative equity, including whether the company is dependent on director loans or external financing.
• Assess any contingent liabilities or off-balance-sheet exposures.
• Confirm whether the company’s business plan addresses the negative equity position and how it intends to restore financial stability.