AL-FALAH ACADEMY OLDHAM LIMITED

Executive Summary

AL-FALAH ACADEMY OLDHAM LIMITED exhibits high financial risk due to sustained negative equity and a weak liquidity position where current liabilities greatly exceed current assets. Despite regulatory compliance and stable fixed assets, the company’s small scale and persistent losses warrant caution. Further analysis of liabilities, cash flows, and business viability is recommended before considering investment.

AL-FALAH ACADEMY OLDHAM LIMITED - Analysis Report

Company Number: 13103343

Analysis Date: 2025-07-20 13:28 UTC

1. Risk Rating: HIGH
   The company shows persistent negative shareholders' funds and significant current liabilities exceeding current assets by a wide margin, which signals serious solvency and liquidity concerns.

2. Key Concerns:

• Negative Net Equity: Shareholders’ funds have been negative continuously since incorporation, reaching -£7,443 as of 31 December 2023. This indicates accumulated losses or insufficient capital to cover liabilities.
• Poor Working Capital Position: Current liabilities (£63,645) substantially exceed current assets (£1,728), resulting in a large negative net current asset position. This situation suggests potential difficulty in meeting short-term obligations and cash flow constraints.
• Limited Scale and Financial Transparency: As a micro-entity with minimal filings, the financial data is limited. The company employs only two people on average and has unchanged fixed assets over four years, which may question operational expansion or revenue growth.

3. Positive Indicators:

• Compliance with Filings: The company has filed its accounts and confirmation statements on time with no overdue filings, indicating regulatory compliance.
• Stable Fixed Assets: The fixed asset base has been maintained consistently at £55,074, indicating some level of asset backing.
• Active Status and Established Governance: The company remains active since incorporation in late 2020 with five directors in place, suggesting ongoing operational intent.

4. Due Diligence Notes:

• Investigate the nature and timing of the company’s liabilities to determine if they are short-term debts or accruals that may be restructured or settled.
• Review cash flow statements or management accounts (if available) to assess liquidity beyond balance sheet snapshots.
• Examine the business model and revenue streams given the low current assets and employment size, to understand sustainability and growth prospects.
• Validate the directors’ roles and expertise relative to the company’s activities, especially since most directors’ occupations are listed outside the education sector.
• Confirm any guarantees or support arrangements given this is a company limited by guarantee, which may affect creditor risk.